private banking customized financial planning
DESCRIPTION
Private Banking Customized Financial Planning. For William Wyatt. “Preparing for the Future”. Presented by Dr. Kai Poetschke, MBA. Economist and Journalist MBA: London School of Economics, PhD: New York University Worked for Bank of Scotland and Chase Manhattan Bank - PowerPoint PPT PresentationTRANSCRIPT
Private Banking Customized Financial Planning– “Preparing for the Future”
For William Wyatt
(Titel of the presentation, Date, Department, Name) · Page 2
Presented by Dr. Kai Poetschke, MBA
Economist and Journalist
MBA: London School of Economics, PhD: New York University
Worked for Bank of Scotland and Chase Manhattan Bank
Moderator of own TV-Show: “Your business is my business” since 1967
(Titel of the presentation, Date, Department, Name) · Page 3
Excellence through Strength- An uncompromising attitude to quality
Founded in 1870, Deutsche Bank is currently the largest financial institution in the world, with assets exceeding USD 800 billion.
a strength that is able to reach around the world, identify opportunities and realize them for the benefit of its clients.
One of the most highly rated banks in the world.
Pre-eminent reputation among world major banks, based on the strength and depth of its business, on its innovative approach to new opportunities, and on enduring client relationships.
(Titel of the presentation, Date, Department, Name) · Page 4
Relationships- Strong client partnerships
Our aim is to establish an all encompassing financial plan with expertise and care that addresses all issues
With an appropriate wealth management strategy, the overall objective is wealth preservation and enhancement through a disciplined approach to investment, combining:
1. A thorough understanding of your individual circumstances, income requirements, return expectations, risk appetite and other objectives.
2. A complete and detailed analysis on your personal business including recommendation regarding succession planning, buy-outs, IPOs & any other customized solutions.
3. Asset allocation and selection expertise that reflects our client’s specific goals.
4. A well-established, prudent investment philosophy.
5. Strong emphasis on client communication and reporting.
(Titel of the presentation, Date, Department, Name) · Page 5
Relationships- Strong client partnerships
Deutsche Bank Private Banking is able to access a wide range of resources and expertise from its large global network within the Deutsche Bank Group.
Irrespective of location, the group works closely together as a team in the interests of the clients and as an integral part of Deutsche Bank Private Banking worldwide network.
Deutsche Bank Private Banking brings to you professionals who have long and varied experiences in private client work
(Titel of the presentation, Date, Department, Name) · Page 6
Added ValueServices
Trust & Fiduciary Services - Deutsche Bank International Trust Company Limited (DBITC), headquartered in Guernsey and with presences in DB’s regional private banking centers, provides trust, fiduciary and other related services to our private clients.
Confidentiality & Privacy are key: Creditor Protection, efficient tax planning
Your Private Banker in Deutsche Bank can access and co-ordinate with the professionals at DBITC who have expertise in Trust and Estate Planning in order to safeguard your wealth and facilitate effective wealth conservation.
US based Trust & Estate Planning incorporating all aspects of US laws & regulations are accessed through our local Trust experts in NY
(Titel of the presentation, Date, Department, Name) · Page 7
Key Issues to be addressed
Businesses: Plastic Company & French Restaurant
Personal Investments
Personal Retirement Plans
Insurance
Estate Planning
(Titel of the presentation, Date, Department, Name) · Page 8
Businesses:
(1) Plastic Company
(2) French Restaurant
(Titel of the presentation, Date, Department, Name) · Page 9
Presented by Dr. h.c. Joerg Sulimma, Attorney
75 years of experience as international lawyer and tax advisor
Financial and law degrees of the universities of Harvard, Capetown, Stockholm and Cuala Lumpur
Over 150 publications in the main law and financial magazins of the world
(Titel of the presentation, Date, Department, Name) · Page 10
Business Presented by Dr. Samantha Ho
25 years of experience advising top-tier clients on business related issues
Articles published in Leading Wealth Management Journals
B.S. Finance: Boston University MBA: Wharton Business School PhD in Philosophy & Political Science: Harvard University
(Titel of the presentation, Date, Department, Name) · Page 11
Business 1 : Plastic CompanyLiquidity Planning / Re-capitalizing Main objective: More access to capital & aggressive business
plan & to grow the business
4 partners with equal share
One partner is looking to sell
Strong cash position : $2 million EBIT
Possible Solutions for partner to :(1) Buy-Sell Agreement (using Insurance)(2) Management Buy-Out (MBO): Formal Buy-out Agreement, Stock
Options for employees(3) Private Equity(4) Strategic Partner
Retirement plan for the firm: 401(k) Pension Fund (defined contribution), defined benefit, Stock Options
(Titel of the presentation, Date, Department, Name) · Page 12
Suggestion (1): Buy-Sell Agreement
Orderly transfer of business if any partners of the partners wants to sell out or dies
Permits co-owners to continue in their business roles
Allows a fair-market price for the business to be agreed upon today
Who will fund this Agreement???– Through an Insurance (Business has good strong cash position
able to buy this insurance)
(Titel of the presentation, Date, Department, Name) · Page 13
Suggestion (2) : Management Buy-Out
Succession Planning Employees have possibility of putting money into
company: Stock Options (can also be included in the retirement plan) Issue new equity (voting vs. non-voting)
Partners may sell out their shares but could remain involved in the business as a Business Advisor or Director => Consultant agreement
Employees to purchase the shares of any partners who want to sell-out => Possibly could get increase in credit
(Titel of the presentation, Date, Department, Name) · Page 14
Suggestion (3): Private Equity Investor
Non-traditional low-cost source of financing
Adds discipline to management & possible expertise know-how
More contacts leading to new business opportunities & new clients
More access to capital from existing creditors
(Titel of the presentation, Date, Department, Name) · Page 15
Suggestion (4) : Strategic Partnership
Raise additional capital
Synergies
Find a partner who could bring additional value to the firm: Example, a firm / partner who is strong in distribution or marketing
Strategic partners – to consolidate with competitors (although you may get the lower value)
Could possibly get increase in credit
(Titel of the presentation, Date, Department, Name) · Page 16
Plastic Company: Retirement Plan
401(K) : Defined Contribution & Defined Benefit– Menu of portfolios to choose from– Deferred income tax: low tax bracket vs. current tax income
Stock Options
(Titel of the presentation, Date, Department, Name) · Page 17
Business: French Restaurant
A 50% Co-Owner
Earnings from restaurant: $10,000 per year
Son: Chef & Manager. Would like to continue business
Solution: Limited partnership (Father), General Partner (Son) with a management contract: I.e. Bonus Base or Fee Base (tax deductible)
Son tax bracket: Low
Gift from father: $10,000 worth of sharse of the restaurant per year (up to $650,000 tax exemption).
(Titel of the presentation, Date, Department, Name) · Page 18
Personal Investments
Asset Allocation
Recommendations
(Titel of the presentation, Date, Department, Name) · Page 19
Presented by Professor Dr. Sandra Duncan
BSc Finance, MBA, JD, PhD (Tax Efficient investments)
Author of best selling book “Damn it, Take Control of Your Finances – How to legally pay no taxes”.
27 years of experience in structured investments with Goldman Sachs, Merrill Lynch, Deutsche Bank
Associate Professor of Tax planning New York University
(Titel of the presentation, Date, Department, Name) · Page 20
Personal Investment Used assets are not included
Is your current investment asset allocation adequate?
Cash Equivalents $ 57,000 (3.38%)Certificate of Deposit $ 100,000 (5.93%)U.S. Treasury Notes $ 175,000 (10.37%)Municipal Bonds $ 310,000 (18.38%)Large Cap U.S. Growth Stocks $ 285,000 (16.89%)Commercial Real Estate $ 375,000 (22.23%)French Restaurant $ 55,000 (3.26%)Stock in Plastics Company $ 380,000 (22.53%)
(Titel of the presentation, Date, Department, Name) · Page 21
Current Overall Asset Allocation
Cash/CDs9% Treasuries
10%
Bonds18%
Equity16%
Real Estate22%
Businesses25%
(Titel of the presentation, Date, Department, Name) · Page 22
Recommendations I
Commercial real estate investment ties up too much capital
ROE (Cash Flow) too low (7.7%)
Suggestion: Refinance existing mortgage up to maximum allowed valueInterest cost of mortgage is tax deductible
Solution: Additional cash becomes available for investment in company
(Titel of the presentation, Date, Department, Name) · Page 23
Current Financial Markets Asset Allocation
Cash/CD's17%
Treasuries18%
Bonds34%
Equity31%
(Titel of the presentation, Date, Department, Name) · Page 24
Recommended Asset AllocationConservative – Balanced Portfolio
Equity40%
Cash10%
Fixed Income50%
(Titel of the presentation, Date, Department, Name) · Page 25
Recommendations II
Current financial market asset allocation is not balanced enough!
Goals: – Capital Appreciation on investments– Restructure to a Balanced Portfolio: 10% Cash/CDs, 40% Equities,
50% Fixed Income– Switch USD Large Cap Growth Stock Portfolio to globally diversified
Portfolio of Growth Stocks – This allocation should produce stable returns on a risk-adjusted basis– To reduce cash by approximately 7%2. Minimize taxes
I.e. The Gift-Tax Annual: tax exclusion of $10,000 (preferably to transfer to someone with a low tax bracket)Suggestion:
– Enable you to give $10,000 p.a. to each grandchild
(Titel of the presentation, Date, Department, Name) · Page 26
Trust Structures
(Titel of the presentation, Date, Department, Name) · Page 27
Presented by Dr. Dr. HC Alexandra Schulz, Chief Trust Officer
29 Years of experience in Trust and Estate Planning
Founder of Deutsche Bank’s Trust and Estate Planning Division
BSC, Astrophysics, MSc, Mathematics, PhD Financial Planning M.I.T and Stanford University
Voted “Best Financial Advisor”, Global Financial Advisors Guild 1998
(Titel of the presentation, Date, Department, Name) · Page 28
Presented byDottore Filippo Pignatti Morano di Custoza
Economist, MBA and PhD at University of Palermo
Long time Specialist in Italian and Austrian economies
Worked for NatWest Bank, Banco di Italia, Banco Santander, National Westminster Bank and Banco di Palermo, Banca Criminale Organizato Di Italia
President of the Italian Communist Party, candidate for the presidential elections in the year 2000
(Titel of the presentation, Date, Department, Name) · Page 29
QTIP Trust I
QTIP Trust• To include the current life insurance
Income BeneficiaryJune Wyatt
Property OwnerBill Wyatt
Principal BeneficiaryGrace Wyatt (Daughter)
(Titel of the presentation, Date, Department, Name) · Page 30
Income to spouse for lifetime
Daughter is principal beneficiary and receives the property after death of her mother
Grantor retains ultimate control over the final beneficiaryof the assets
Trust ends after death of the spouse
QTIP Trust I
(Titel of the presentation, Date, Department, Name) · Page 31
Charitable Remainder Trust I Recommendation: To be included in the Will
CharityRemainder
Trust
Income BeneficiaryJune Wyatt
Property OwnerBill Wyatt
Principal BeneficiaryCollege
(Titel of the presentation, Date, Department, Name) · Page 32
Assets will be transferred into the trust after grantor’s death
Trust will pay income to the spouse as beneficiary
Trust ends after death of the spouse
Principal beneficiary receives the property
Charitable Remainder Trust II Recommendation: To be included in the Will