Founded in 1926, Banca March is the foremost family-owned Spanish bank. Soundness, prudence and a close-knit relationship with its clients are the cornerstone values of a bank that has been around for nearly a century. Banca March also has the best solvency ratio among Spanish banks and one of the highest in European banking (19.7 percent Core Capital and Tier 1 as at December 2009). Its non-performing loan ratio is one of the lowest in the Spanish financial system (2.82 percent in 2009), namely due to the excellent quality of its investment portfolio, and it has a high allowance coverage ratio for insolvencies (97.20 percent), in accordance with the standards comprised in the bank’s philosophy. Banca March maintains its A2 Moody’s rating for long-term deposits, and P1 – the highest level – for short-term deposits. As Bank President Carlos March points out, “as part of our banking and family enterprise business philosophy, which has been in place for nearly one hundred years, one of the constants in our corporate values has been to allocate the majority of our profit to strengthening the balance sheet as a symbolic sign of our prudence.”
During the past three fiscal years Banca March has taken important steps to develop a new strategic focus: as regional bank on the Balearic Islands – where it was founded and has its headquarters – and as the bank of reference for the mid-to-high and high client segments for Private Banking, Wealth Management and Business Banking (particularly family-owned businesses and entrepreneurial families). The bank continues to place emphasis on these strategic areas, all the while markedly reinforcing its teams.
“We are a family bank, with the fourth generation currently filling the highest levels of the Board. We are focused on meeting our clients’ needs and managing their equity in all its different facets: entrepreneurial, financial and diversification. Our success is based on having a very clearly defined strategy. Our objective is to reinforce long-term relationships with our clients, with the hope of continuing these into the coming generations. Offering family-owned businesses added value is one of our corporate values, and one of which we are very proud,” says Banca March CEO Francisco Verdú.
The wealth management team is made up of 50 professionals spread across six regional locations: Madrid, Balearic Islands, Canary Islands, Catalonia, Levante and Aragon, the latter three having opened in 2009 and 2010.
Most impressive has been the growth in wealth management in the regions of Catalonia and Levante, where the volume of assets under management has doubled. The private banking segment, which is aimed mainly at mid-sized patrimonies, has also been strengthened as a result of streamlining and organisational changes, and the incorporation of specialised teams in the most important offices within the network.
“At a time of crisis within the private banking industry, we have known how to value our offer and have obtained excellent results in spite of the situation,” says Rafael Gascó, Managing Director of wealth management for Banca March. “The crisis in private banking is due to clients losing confidence in their money managers, basically for two reasons: because sales were given priority over service and because the products being sold were incomprehensible not only to the clients, but to the bankers themselves.”
“One of the most crucial parts of our value proposition is estate planning. As a result of continuing regulatory and fiscal changes, we must constantly revise our clients’ estate planning needs,” adds Gascó. “Due to changing sentiments emerging within this sector and clients’ increased aversion to risk, it is essential that we be able to offer them products with value added which generate foreseeable cash flows, and are also transparent and simple to understand. This is something we appreciate at Banca March.”
One of the aspects that differentiates Banca March is the joint investment contract. Clients have the possibility of investing in different businesses in which the March Group brings management capabilities and know-how, and takes a stake in the projects it launches. Through Deyá Capital, a venture capital firm created in 2008 and held principally by Corporación Financiera Alba (Banca March’s Group), the bank offers the possibility to jointly acquire significant stakes in companies not listed on the Iberian market. Up to now, investments have been made in Ros Roca and Ocibar, and new opportunities are at an advanced stage. In line with this philosophy of providing offers with a high degree of value added, Banca March offered its clients the chance to invest in the so-called “Proyecto Arbol” (sale and lease back of BBVA real estate) and it is currently studying other similar projects.
During the last two years, Banca March’s wealth management/private banking business has recorded more than double-digit sustained growth, making it one of the companies with the most assets under management in this segment, while already being one of the companies with a major presence on the national market place. “We are proud to say that we are a respected brand not only by our clients, but also by our competitors and by professionals working in this segment,” highlights the head of wealth management.
Profile
The Banca March Group encompasses a variety of activities: banking, conducted directly by the parent company, Banca March; investment and pension fund management, handled by March Gestión; and insurance activities, through Banca March as the associated banking-insurance operator, and March-Unipsa as insurance brokers. March Unipsa is one of the top five Spanish brokers in the insurance business and the first one composed entirely of Spanish capital.
Through its business banking unit and corporate finance department, the bank provides the strategic consulting services necessary to implement companies’ expansion plans, helping them obtain credit as well as assisting them in finding partners in this growth process.
March Gestión, Banca March’s investment arm, combines creating long-term value with safeguarding equity in the belief that active management is an important source of value added for the profitability of any investment portfolio. March Group’s experience in investing in business projects, in the tactical allocation of assets and in the selection of medium and long-term investments are the characteristics which predominate the work of the management professionals.
A prime example of this investment philosophy are the SICAVs (Investment Company with Variable Capital) managed by March Gestión de Fondos. Torrenova, one of the group’s banner portfolios, has accumulated a return well above the Euribor 3M, IBEX 35 or MSCI World in the last decade. These returns have been achieved through sustained growth in contrast to the considerable fluctuations recorded in the key indicators.
At the end of 2009 March Gestión launched Vini Catena F.I., the first global equity fund investing in a selection of some of the finest companies involved in the wine value chain, a very attractive sector in terms of yield/risk to diversify any investment portfolio. Since its launch in December 2009, and despite the overall drop in stock exchanges, this equity fund yielded a nine percent return.
In 2009 March Gestión recorded double-digit growth in assets under management and added 23 new SICAVs. More than 80 percent of its funds and SICAVs exceeded benchmark rates.
Through the group’s majority shareholding in the listed firm Corporación Financiera Alba, Banca March owns significant stakes in some of Europe’s most important companies for infrastructure, construction and services, energy, information technology and defence, and health, etc. It is major shareholder in ACS and Acerinox, and a main shareholder in companies such as Prosegur and Indra. Moreover, through its venture capital fund Deyá Capital, held in large part by Alba, the bank holds significant stakes in companies such as Ros Roca and Ocibar.
In addition, through its Fundación Juan March, established in 1955, it is involved in fostering culture and the arts. It is a family-run, patrimonial and operative institution dedicating its resources and activities to the fields of the humanities and science. The Fundación Juan March organises art exhibits, concerts as well as series of conferences and seminars. It administers a music and theatre library in its Madrid headquarters and directs the Museo de Arte Abstracto Español in Cuenca and the Museu Juan March in Palma de Mallorca. Moreover, it is active in the field of research through its Centre for Advanced Studies.
Banca March is a driving force behind the Asociación de Empresa Familiar (Association of Family Businesses) and sponsors the Banca March Chair of Family Business at the University of the Balearic Islands.
For more information tel: +34 914 364 323; www.bancamarch.es
