Coutts, the bank to rely on in a Covid crisis – if you're seriously wealthy

Workers at Coutts, the private banking division of NatWest, are used to booking lavish parties and vacations for their millionaire clients.

But once Covid struck, the Queen’s bank quickly became an upmarket emergency service, with staff in its concierge arm helping to repatriate clients’ children stuck abroad on gap years and arranging emergency evacuations for customers stranded overseas.

Since 2008 Coutts, which has served the Queen and every member of the royal family since George IV, has inhabited the strange role of serving the nation’s wealthiest households while also being 62% state owned after the rescue of NatWest.

As such, it has drawn the line at private medical care, leaving clients to book their own tests, jabs or GP checks. But at the start of the outbreak, Coutts staff were on call around the clock until clients were home safe and sound.

Chief executive Peter Flavel recalls one client who told his wife to call his personal banker if anything went wrong while he was abroad last spring. “And something did go wrong. Significantly wrong. And that banker got called up in the night, and in a very short order we are able to arrange emergency evacuations.”

It illustrates how far the 329-year-old lender will go to cater to its wealthy customers, who are used to an extreme level of personal service that high street banking customers could only dream of. The challenge is keeping private banking clients sweet during a pandemic that has barred Coutts from organising exclusive events or impressing clients with its illustrious offices.

The lender has been forced to temporarily close its famous 440 Strand building in London, where it usually entertains customers on its rooftop garden – which supplies fresh fruit, vegetables and honey from its own bee hives – and serves meals from its private chef. So, like most businesses, Coutts has had to go digital. Regular meetings have shifted to Zoom and exclusive events have gone online.

The bank is now hosting virtual tastings with the head of its wine supplier Tom Gilbey, and live gourmet cooking classes, featuring meals such as risotto and pan-fried goat’s cheese, with its executive chef Peter Fiori.

Flavel says the online events helped clients and staff relax.

But remote working, as well as a lack of casual networking that usually leads to referrals, has made it even harder to attract new clients. Coutts and its sister brand Adam & Company – which Flavel also manages under the NatWest umbrella – together attracted just 1,600 new customers in 2020, down from approximately 2,400 a year earlier. Annual operating profit for NatWest’s private banking business dropped 30% to £208m.

However, existing clients are growing accustomed to less face time. Flavel says most customers – who must have at least £1m to bank with Coutts – plan to hold three of their four quarterly check-ins online after the pandemic is over. But the chief executive is not planning to abandon Coutts offices anytime soon, and hopes to get bankers and borrowers back into the atrium and portrait gallery at the Strand as soon as it is safe to do so.

“I’m not thinking that I want everything to be video. I don’t think that fits the brand and who we are as a bank. But equally, I don’t think it all needs to be face-to-face,” Flavel says.

Fostering a hybrid model for meetings and client services could also help attract the next generation of wealthy customers. Since taking the reins as chief executive in 2016, Flavel has been trying to appeal to celebrities, e-gamers YouTubers and social media influencers who could broaden the bank’s customer base.

“Our historic client base – which still remains landowners, hereditary wealth, senior executives – remains and always will remain a very important part of what we do. But the world is changing … and wealth is being formed now in many different ways. And for us to remain modern and relevant and contemporary we have to evolve.”

While the bank does not confirm the names of its clients, British rapper Stormzy is believed to be among them, while Harry Potter star Emma Watson is known to have signed up for a Coutts course shortly after learning about the size of her wealth.

Flavel said junior bankers have had to coach some of Coutts’ more experienced wealth managers on social media and digital trends that are behind new clients’ wealth. “The good thing is that our younger staff don’t need to be trained in these things because they’re of the same generation,” Flavel says. “It’s the more mature bankers that needed to be reverse mentored by the younger ones as to what this means. So it’s a good partnership,” he adds.

“So really it’s about making sure we’re relevant to a new style of doing business.”