The year in brief
Facts & Figures
Deutsche Vermögensberatung can look back over a very successful 2022, a year which once again saw the firm achieve record results in many areas.
This success emphasises that people remain extremely interested in wealth formation, pension provision and risk assurance, even in times shaped by great uncertainty and a whole host of unknowns. Furthermore, it underscores the fact they want to receive comprehensive, customised advice on these topics – in person. As a result, the prospects for the financial advisory profession are looking better than ever before.
Forging ahead to success in a challenging environment
On an overarching level, 2022 was shaped by Russia's war of aggression against Ukraine, which also dominated the media. It sparked uncertainty, put the global economy to the test, led to fears about energy supply and caused inflation – and, by extension, interest rates – to spike. Our financial advisors and their work have more than proved their worth, under these circumstances. Not only did they advise and look after their clients to the best of their ability, they were also sought-after as a source of advice when explaining the interdependencies on the financial markets, and assisting clients to identify ways to economise in other areas as prices rose sharply. Alongside all the associated successes for the company, this once again boosted the importance and value of the profession.
With revenues of over EUR 2.2 billion, the company was able to maintain almost the same level as the previous year, which had been shaped by one-off effects. Compared to the "normal" year of 2020, this represented an increase of almost 10 percent. New records were set in terms of annual net profit (EUR 245.7 million) and by many individual business areas. Furthermore, as in the previous years, 2022 also saw far more than 1,500 people opt to give up their previous profession to enjoy the opportunities and benefits of working as a financial advisor. All of this above highlights that Deutsche Vermögensberatung and its financial advisors are currently on a long-term path to growth and success, one that has also continued throughout a year marked by challenging overarching conditions.
Allfinanz and Deutsche Vermögensberatung
Performance-driven, human and strong – these values characterise the culture of the company and its professional community. They are the guiding principles by which we work, and which all our financial advisors follow. Deutsche Vermögensberatung is a family-owned company through and through, and every financial advisor is part of this, too. It goes without saying that those working for its subsidiary Allfinanz or in Austria and Switzerland are, as well. They also contributed to the successes of 2022. One key factor in these achievements: our financial advisors have no reservations about letting their colleagues share in their recipes for success. In turn, the success of the individual becomes the success of others and, at the end of the day, the success of the company as a whole.
Retirement provision: Your pension is in safe hands, thanks to our financial advisory approach
"Your pension is in safe hands": everyone knows that's not necessarily true. The state pension has got smaller and smaller over the last few decades and is currently at 48 percent. On its own, that's not enough to live on in retirement. And things aren't looking any better in the future, either. As a result, one of our financial advisors' key tasks is showing their clients how to build up a secure pension that will meet their needs, whether through private pension insurance, occupational retirement provision or the use of state funding.
The success of this approach day in, day out is also confirmed by the results: in life insurance, Deutsche Vermögensberatung increased its portfolio (sum insured, excluding occupational incapacity insurance) by 2.7 percent. It now totals EUR 179.2 billion (previous year: EUR 174.5 billion). As a result, the company substantially outperformed the market, which recorded a figure of -2 percent. New business represented EUR 16.6 billion, a little less than in the previous year (EUR 19.1 billion). This was primarily due to the fact that politicians have, to date, failed to reform the "Riester" pensions that are attractive for people on a low income or who have children.
As a result, it has not been possible to sell this product since 2022. That said, we were able to equalise this loss, by and large. How? From this year on, financial advisors can now offer their clients a much-improved basic pension (Basisrente) with enhanced tax benefits, as a staatlichstate-backed product. A total of 35,298 contracts for this pension have already been brokered, reflecting an increase of more than 72.3 percent on the previous year; this figure is rising rapidly. The market share held in this segment by Deutsche Vermögensberatung leapt from 20.3 percent to 30.2 percent. This underscores the fact that financial advisors always have the best solution for their clients, which includes helping them obtain state support for their all-important pensions.
Staying healthy with private health insurance
The pandemic has left its mark on many of us, including our awareness of our own health. The German population is getting ever older. However, statutory health and nursing care insurance only offer basic protection and have significant gaps in coverage. Here, financial advisors are the first port of call when a client wants to supplement their health insurance or top up their utterly inadequate state nursing care insurance. One mainstay of this is the partnership with BKK Linde, which every financial advisor and their clients with statutory insurance can benefit from. In 2022 alone, more than 18,000 new clients were signed up with this supplementary fund and given additional insurance under the attractive rates offered by Generali health insurance. This is a new record. As a result, our company's portfolio in private health and nursing care insurance increased by 3.5 percent in 2022, now reaching an annual nominal premium rate of EUR 1,531.6 million. Here, too, we have outperformed the market. At EUR 58.3 million, new business is only just shy of the previous year's level.
Insurances: Staying safe, at all times
People face lots of risks. If something happens, the costs can quickly mount up – be it in an instance of liability, a break-in, theft, fire or storm damage. Or in the event of accidents that cause injury or, in the worst-case scenario, lead to a permanent disability. It is possible to set up financial protection to cover each of these risks individually. However, it is better to take out a "wealth protection policy" ("Vermögenssicherungspolice"). This is only available from financial advisors and offers comprehensive cover for day-to-day risks.
The company's financial advisors have already brokered more than a million such policies, thereby expanding the company's portfolio of non-life, liability, accident and legal protection insurance policies by 2.9 percent in 2022 to reach EUR 2.8 billion. New business declined slightly (EUR 410.2 million), primarily due to tough competition in car insurance, where many people only care about the bottom line. Conversely, financial advisors care about quality: namely, seamless coverage and first-rate service in a loss event.
Pro rata and with equity funds – how to grow your assets
Low interest rates, penalty interest from banks and Sparkasse, and now high inflation too – if you simply leave your money sitting in your account, your assets won't grow. In fact, they'll shrink. And yet many Germans place very little trust in equities and equity funds. Unjustly so. If you're saving for the long-term, in particular, investing in equities is almost as low-risk as other forms of saving – but its potential returns are much better. This is especially true if you invest in broad-based funds, rather than individual stocks.
Explaining this precise link is one of the key tasks of a financial advisor. They help their clients get the best out of their hard-earned cash in the long run – while generating returns and minimising risk. What financial advisors don't do: offer high-risk investment products or motivate their clients to conclude short-term deals that are allegedly lucrative. Instead, Deutsche Bank and its subsidiary DWS Investments support the financial advisors as reliable, financially sound partners with the perfect products.
In 2022 alone, 350,000 new fund savings plans were taken out: this equates to almost 1,000 per calendar day. This, too, marks a new record, one which is particularly impressive given the temporary turbulence on the stock markets sparked by the war. New business (direct investments without unit-linked life insurance) with investment funds increased by 2.0 percent to hit a record high of EUR 3.0 billion. Despite the fall in prices, the investment portfolio only reduced slightly, to EUR 33.8 billion. As the markets picked up again, clients quickly saw this downturn balance out.
Real estate, financing and payment transactions: A golden age for building savings schemes
Smart investors had their financial advisor explain the concept of building savings schemes in 2022. After all, this approach has rarely been as valuable and sensible a choice as it is right now. As interest rates are currently rising, entering into a building savings scheme means you can secure the current interest rate in the long-term, regardless of how high interest rates go. This means you can easily calculate the cost of a buying a property in five or ten years, while you build up the necessary capital in a building savings account. Given the rate of inflation and the resulting interest rate expectations, it's no surprise that financial advisors are currently swamped with enquiries for financial advice. With an increase of 77.7 percent, the new business for building savings schemes at Deutsche Vermögensberatung reached a new record of EUR 3.7 billion. The portfolio already stands at EUR 26.2 billion, an increase of 11.9 percent.
Bank-based construction financing transactions were unable to quite keep up, which makes perfect sense: if people do not want to wait to buy their property, or are unable to do so, they have no option but to finance it at much higher interest rates. High property prices and high prices for construction materials play their part, too. The drop in demand meant that the company's new business with construction financing was, therefore, slightly down, at -10.5 percent and a financing volume of EUR 3.7 billion (previous year; EUR 4.1 billion).
Financial advisory also involves always looking at clients' payment habits. No method of financing is more expensive than an account overdraft. Carefully evaluating a client's monthly expenditure makes it possible to quickly identify high-cost items. As a result, financial advisors also offer their clients advice on their approach to their personal finances, using the relevant products. First and foremost, they include a current account from Deutsche Bank with special terms and low-cost personal/consumer loans that enable people to restructure their debt and save a lot of money in the process. This approach saw a loan volume of EUR 508.7 million brokered in 2022. Furthermore, 52,426 clients opted for Deutsche Bank's "Zinskonto Plus".
Gold offers protection against inflation and a sense of security in a crisis
Gold has a wonderful shine – and for that alone, it fascinates people, who wear it as jewellery or give gold coins as gifts. This precious metal is also considered to be resistant to crises and inflation, which is why it is a popular add-on to a financial investment portfolio. There are all kinds of ways to do this – and only a financial advisor can offer such breadth from a single source, be it in the form of physical gold, a savings plan or a one-off investment. There is even the option of using it as part of your retirement provision, bundled within private life insurance and pension insurance products. The range was expanded in 2022 to include a new, exclusive silver savings plan.
Due to the spike in demand, the price of gold is not far off its historic high. As a result, our financial advisors have already been able to broker a total of 6.4 tonnes of gold, an increase of more than 80 percent.
Financial advisory for entrepreneurs and the self-employed
Financial advisory is not just limited to private clients. Lots of SMEs and self-employed workers need financial advice on the commercial side of their business so they don't leave their money sitting idle or expose themselves to unnecessarily high risks. Occupational retirement provision is also of interest to many wishing to boost employees' loyalty to their own company. As a result, Deutsche Vermögensberatung was able to further expand its B2B insurance business, growing its portfolio by 7.8 percent to reach EUR 316 million. The range of services offered by Deutsche Verrechnungsstelle, which financial advisors can broker exclusively for their commercial clients, exert a particular appeal and are not available anywhere else on the market in this form. These products revolve around invoice and receivables management, and the financing of operational investments. The demand for these services and corresponding financial advice is constantly growing.
Financial advisory as a winning export
Financial advice is given from one person to another. It is a local business and always closely tied to social security systems, which differ greatly from one country to the next. However, one aspect applies to all countries: their citizens need financial advice to get to grips with this complex matter. Having one single person who is able to provide this financial advice across all sectors is always a benefit – and is reflected in the success of Deutsche Vermögensberatung in Austria and Switzerland.
As a result, Deutsche Vermögensberatung Bank AG, headquartered in Vienna, can look back on another highly successful financial year, where revenues only dropped slightly following the exceptional year of 2021. In the year under review, Schweizer Vermögensberatung in Zurich consolidated its business after the change in management and laid the foundations for a sustainable growth strategy. Global Sana AG, in which Deutsche Vermögensberatung is a majority shareholder, previously specialised in brokering health insurance. Now, it has shown initial success in refining its business model to reflect a holistic financial advisory approach.