How to Select a Private Bank: A Guide for High-Net-Worth Clients

Choosing a private bank is one of the most consequential financial decisions a high-net-worth individual or family can make. The right relationship — built on genuine alignment of interests, transparent fees, appropriate investment capability, and strong client service — can deliver significant value over decades. The wrong relationship, maintained through inertia, can cost hundreds of thousands of pounds in avoidable fees and substandard returns. This guide walks through the key considerations at each stage of the selection and transition process.

Defining Your Requirements

Before approaching any institution, spend time defining precisely what you need. Private banking is not a monolithic service. Clients' requirements vary enormously, and a bank that excels in one area may be mediocre in another. Key questions to resolve:

Discretionary vs advisory vs execution-only. Do you want an investment manager to make day-to-day decisions within an agreed mandate (DFM — discretionary fund management)? Or do you prefer to approve all significant transactions (advisory)? Or do you simply want a custodian to hold assets while you or a third-party manager make the investment decisions (execution-only custody)?

Lending and credit. Does the relationship need to include Lombard lending (borrowing against your portfolio), mortgage lending, or other credit facilities? Many private banks offer attractive lending as part of an integrated relationship, but the terms vary significantly.

Currency and international capabilities. If you hold assets in multiple currencies or have cross-border requirements, does the bank have genuine multi-currency capability, correspondent banking relationships, and experienced international private bankers?

Specialist services. Do you need access to co-investments in private equity or real estate deals? Specialist tax reporting? Trust administration? Succession planning support?

Relationship model. Do you want a senior banker with genuine decision-making authority, or are you comfortable with a relationship manager supported by product specialists? How important is continuity of relationship versus access to a broad team?

Being clear about these requirements at the outset allows you to shortlist providers who are genuinely suited to your situation, rather than wasting time with institutions who cannot meet your core needs.

AUM Minimums

Private banks typically impose minimum asset thresholds for onboarding clients, and in practice the level of service you receive will depend partly on the size of your relationship. Published minimums range from approximately £500,000 at the entry end of the market to £5m–£25m at the more exclusive institutions. Some international private banks in London have effective working minimums of £10m or above for a genuinely senior relationship.

Clients with assets below the relevant threshold are sometimes directed to a "wealth management" division or digital proposition rather than receiving the full private banking relationship they expected. Ask directly about the minimum relationship size for the service level you require, and ask specifically who your primary contact will be and what their book size is.

The Request for Proposal (RFP) Process

A well-structured RFP — even an informal one conducted over a series of meetings — is the most effective way to compare providers on a consistent basis. The RFP should cover:

Investment philosophy and process. How does the bank construct portfolios? Is it genuinely open-architecture (able to select best-in-class funds from any provider), guided architecture (a curated open list), or primarily proprietary (house funds and discretionary mandates)? What is the investment committee structure and how are decisions made?

Performance reporting. Ask for audited composite performance data. The Global Investment Performance Standards (GIPS) are the gold standard for performance reporting — GIPS-compliant data allows meaningful comparison between managers because it requires consistent calculation methodologies, full composite disclosure, and fee transparency. Not all private banks provide GIPS-compliant reporting; those that do signal a commitment to transparency. Ask specifically for net-of-all-fees performance over five and ten years against relevant benchmarks.

Fee structure. Private banking fees are complex. Common components include: management or advisory fees (typically 0.5%–1.5% per annum on assets), transaction charges (commissions on individual transactions), fund costs (the AMC or OCF of underlying funds), custodian charges, and in some cases platform or administration fees. The total cost of ownership (TCO) — the all-in cost including all fees and fund charges — is what matters. Request a written all-in cost illustration for a typical portfolio of your size.

Lending terms. If lending is important, ask for indicative Lombard rates, loan-to-value ratios, margin call policies, and typical credit approval timelines. Compare these against other providers and standalone lending specialists.

Service standards. Who will be your primary relationship manager? What is their seniority and experience? Who covers in their absence? What is the bank's approach to succession within the relationship team?

Regulatory and compliance. Ask about the bank's FCA regulatory status, financial strength, and any recent regulatory actions or significant complaints. All FCA-regulated firms must be listed on the FCA register.

CASS Client Money Segregation

The FCA's Client Assets Sourcebook (CASS) rules govern how regulated firms hold client money and client assets. Understanding CASS protections — and their limitations — is important for high-net-worth clients.

Client money. Cash awaiting investment must be held in designated client accounts, segregated from the firm's own money. In the event of the firm's insolvency, CASS-protected client money is not available to general creditors.

Safe custody assets. Securities held on your behalf should be held in designated client accounts or registrations, segregated from the firm's proprietary assets.

Financial Services Compensation Scheme (FSCS). FSCS protection covers eligible claims up to £120,000 per person per institution for cash deposits (raised from £85,000 with effect from 1 December 2025) and up to £85,000 per claimant for investment losses arising from firm failure. For most private banking clients, FSCS protection covers only a small fraction of total assets. CASS segregation is the primary protection for assets above the FSCS limit.

Clients holding very large portfolios with a single institution face concentration risk even within a CASS-compliant firm. Spreading assets across two or three custodians is one risk-management response, though it increases complexity and potentially cost.

Changing Private Banks: The CASS Transfer Process

Switching private banks is more straightforward than many clients assume, but it requires careful management to avoid disruption, cost, or tax consequences.

Portfolio transfer in-specie. In most cases, securities can be transferred in-specie (i.e. the holdings themselves transfer, without being sold and repurchased) from one custodian to another. This avoids triggering a capital gains tax event on unrealised gains, which is particularly important for portfolios with large embedded gains.

CREST stock transfer. UK-listed securities held in CREST can typically be transferred electronically between custodians. The process takes two to four weeks in practice. The receiving bank will need to set up accounts and complete KYC/AML checks before transfers can proceed.

Non-UK and alternative holdings. International securities held in nominee accounts, private equity interests, and alternative fund holdings may be more complex to transfer and may involve manual processes, retitling, or in some cases the need to redeem and reinvest. Identify these holdings early in the transition planning process.

Tax planning. Before initiating a transfer, review unrealised gains and losses. A switch may be an opportunity to crystallise gains in a tax-efficient manner (e.g. within annual CGT allowances), or to harvest losses. Conversely, a poorly timed transfer that forces realisations could create an unexpected tax liability.

Notice periods and break costs. Some mandates include notice periods (typically one to three months) or early exit fees. Review the terms of your existing mandate before giving notice.

Continuity of lending. If you have Lombard lending or a mortgage with your existing bank, ensure the incoming bank can replicate or replace these facilities before you commit to switching. There may be a period of exposure if lending is called before new facilities are in place.

Red Flags to Watch For

In the selection and review process, be alert to:

• Unwillingness to provide all-in cost illustrations or GIPS performance data.
• Heavy reliance on in-house funds at full fees within a supposedly open-architecture mandate.
• Relationship manager turnover significantly above industry norms.
• Pressure to maintain lending balances as a condition of relationship continuity.
• Lack of transparency about conflicts of interest (e.g. revenue-sharing arrangements with fund managers).

How Global Investments Can Help

Global Investments provides independent advisory support to clients undergoing private bank selection or transition processes. We can help you define requirements, structure the RFP, compare proposals on a like-for-like cost and service basis, and manage the CASS transfer process from start to finish. As an independent firm, we have no conflicts of interest in making recommendations. Contact us to discuss how we can support your private banking review.

This guide is for information purposes only and does not constitute investment, legal, or regulatory advice. Readers should obtain independent professional advice before making decisions about private banking relationships. Fee structures, FSCS limits, and CASS rules are as at June 2026 and are subject to change.