December 7 – 9, 2014Las Vegas, N.V.

private wealth pmanagementsummit

Restoring Client T tTrust

Peter E. “Tony” Guernsey, Jr. Chief Client Advocate, Wilmington TrustChief Client Advocate, Wilmington Trust Company350 Park AvenueNew York, NY 10022

private wealth management summit December 7-9, 2014

R.I.P. Banks we have lost… 1st ChicagoAllfirst Financial

European AmericanFiduciary Trust CompanyAllfirst Financial

Amsterdam Rotterdam Bank NV Banco Svizzera ItalianoBank Austria Creditanstalt AG Bank of Boston

Fiduciary Trust Company First Charter Bank First Interstate Bank First National Bank of BostonFirst National Bank of Chicago

Bank of New EnglandBank of TokyoBank One Corp. Banker’s Trust B B l L b t

First National City BankFirst UnionFirst Virginia Banks Inc.FleetBostonF kli N ti lBanque Brussels Lambert

Banque National de ParisBarnett Bank Boatman’s Bank Boston Safe Deposit

Franklin NationalGolden State BancorpGolden West FinancialGoldomeHarris BankBoston Safe Deposit

Canadian Commercial BankChartered West LBChemical Bank Commerce Bank

Harris BankHartford NationalHibernia National BankIndustrial Bank of JapanInvestors Bank & Trust

Continental Bank Core StatesCrocker BankDime Bancorp D d B k

Irving Trust Co. J.P. MorganKeystone Financial LaSalle Bank L b d Odi

©2011 Wilmington Trust Corporation. All rights reserved. Please see the disclosures for important information.

Dresdner BankEspirito Santo

Lombard OdierLong Term Credit Bank

private wealth management summit December 7-9, 2014

R.I.P. Banks we have lost… Manufacturers Hanover Marine Midland

Republic of Texas Riggs BankMarine Midland

Mellon Mercantile BankMichigan National BankMidland Bank

Riggs Bank Saudi International BankSchrodersSecurity PacificShawmut Bank

Midlantic BankMitsubishi BankMorgan Grenfell & Co. Nat WestN ti l B k f D t it

South TrustSouthwest BankStandard Chartered Merchant BankSummit BancorpS it B kNational Bank of Detroit

National City Corp. National Commerce FinancialNationsbankNCNB

Summit BankSwiss Bank Corp.Texas CommerceU.S. Trust Union Planters CorpNCNB

Nippon Credit Bank North Fork Bank NorwestPenn Square

Union Planters Corp. U.S. Bancorp Wachovia Washington MutualWegelin Bank q

Pittsburgh National BankProvidence BancsharesQuaker City Bank Republic Bank R bli B

gWestminster BankWilliams & Glyns BankWilmington Trust World Savings Bank

©2011 Wilmington Trust Corporation. All rights reserved. Please see the disclosures for important information.

Republic Bancorp Republic National Bank of New York

private wealth management summit December 7-9, 2014

R.I.P. Brokerage Firms we have lost…A.G. EdwardsA.G. Becker

First Boston Furman SulzA.G. Becker

Alex Brown & SonsArnold & Bleichroeder Inc.BacheBaker Weeks

u a SuH.C. WainwrightHambrecht & QuistHambrosHarris Upham

Barclays de Zoete WeddBaringsBear SternsBlythe Eastman DillonBurnham

Haydon StoneHemphill Noyes

BurnhamC.J. LawrenceCazenove & Co.Clark DodgeCredit LyonnaisyDarier Hentsch & CieDean WitterDillon ReadDLJDonaldson Lufkin & JenretteDresdner Kleinwort BensonDrexelE.F. HuttonEberstadt

©2011 Wilmington Trust Corporation. All rights reserved. Please see the disclosures for important information.

EberstadtF.S. MoseleyFaulkner Dawkins & Sullivan

private wealth management summit December 7-9, 2014

R.I.P. Brokerage Firms we have lost…Herzfeld & SternHill Samuel

Thomson McKinnon Wasserstein Perella & Co.Sa ue

Hornblower Weeks Kidder Peabody Kuhn, Loeb & Co. L.F. Rothschild

asse s e e e a & CoWertheim Wheat First SecuritiesWhite Weld Wood Gundy

Laird & Co. Lehman Brothers Loeb Rhoades Long Term Capital ManagementMerrill Lynch

Yamaichi Securities

Merrill Lynch Montgomery Securities Paine Webber Paribas Phillips & DrewpPiper JafrayPrudential BachePutnam LovellRobert Fleming & Co.

C & SRobertson Coleman & Stevens Salomon Brothers SG Warburg Shearson HamillShields

©2011 Wilmington Trust Corporation. All rights reserved. Please see the disclosures for important information.

ShieldsSmith BarneySpencer Trask

private wealth management summit December 7-9, 2014

1980’s Big 8:Arthur Young & Company

R.I.P. Accounting Firms

Arthur Young & CompanyCoopers & LybrandErnst & Whinney (formerly Ernst & Ernst)Haskins & Sells (merged with European firm to become Deloitte, Haskins and Sells) KPMG (formed by merger of Peat Marwick International and KPMG Group)( y g )Price WaterhouseTouche Ross

2014 Big 4:Deloitte Touche Tohmatsu LimitedErnst & YoungKlynveld Peat Marwick Goerdeler (KPMG)PricewaterhouseCoopers (PwC)

R.I.P. Law FirmsToo long to list….

©2011 Wilmington Trust Corporation. All rights reserved. Please see the disclosures for important information.

private wealth management summit December 7-9, 2014

Evolution of Wealth Industry

1970’ P l B ki1970’s - Personal Banking

1980’s - Private Banking

1990’s - Private Client Services

2000’ W lth M t2000’s - Wealth Management

MFO’s – Multiple Family Offices

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private wealth management summit December 7-9, 2014

Private Client Services

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private wealth management summit December 7-9, 2014

Private Banking

©2010 Wilmington Trust Corporation. All rights reserved. Please see the disclosures for important information.

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private wealth management summit December 7-9, 2014

1990s

Glass- Steagall 1933-1999

Banks convert to full financial Services firms

Backbone of Private Banking in the 80s- unsecured lending

Losses- Merrill, Citibank, B of A

Perception of reduction of revenues versus actual losses

Consequence, choose your niche

©2010 Wilmington Trust Corporation. All rights reserved. Please see the disclosures for important information.

private wealth management summit December 7-9, 2014

Simultaneously, Technology Takes Hold

Forced clients away from single wealth provider platform

CNN, PCs, Bloomberg, Blackberries, Apple

Fox News, on line banking, online portfolio, discount brokerage

©2010 Wilmington Trust Corporation. All rights reserved. Please see the disclosures for important information.

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private wealth management summit December 7-9, 2014

Your Personal Financial Vendors of Today do what?

CMA- cash

Checking and savings accounts

Lif I t ilit d i di id lLife Insurance, corporate, military, and individual

Personal mortgage flipped to mortgage backed markets

DB Plans out, DC in- hundreds of Mutual funds to choose from

Pretax health plans

Discount brokerage

529 Plans529 Plans

Tuition loan from Gov’t

Car loan- USAA

Custodian of securities

Hedge Finds

Fund of Funds

©2010 Wilmington Trust Corporation. All rights reserved. Please see the disclosures for important information.

Fund of Funds

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private wealth management summit December 7-9, 2014

G ld 144 L di

Pick a FlavorGoldman-144 Lending

Morgan Stanley- Emerging Markets

Deutschebank- Capital Markets

J.P. Morgan- Self-directed investor, J.P. Securities

The Swiss- International diversification

BONY- Custody

Northern- The Family Office

Banker’s Trust- Derivatives

Republic GoldRepublic- Gold

Bessemer- Oil and Gas Co-investing

Manufacturers Hanover/Chemical/ Chase- Middle Market Corporate

Brown Brothers- Forex

Boston Safe- Jumbo Mortgages

Wilmington Trust- Fiduciary

©2010 Wilmington Trust Corporation. All rights reserved. Please see the disclosures for important information.

Citibank-global

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private wealth management summit December 7-9, 2014

The Client Meeting of 2014

• Update on the family…

• Quarterly review of portfolios

• Some more needed financial planning

• Review Changes in Tax Law

• Gifting…

• Nice being with you….

No Wait©2010 Wilmington Trust Corporation. All rights reserved. Please see the disclosures for important information.

No Wait…13

private wealth management summit December 7-9, 2014

Do you provide….?

Aircraft leasing

Autistic Child

Offshore trust from French relative

College Placement advisor

Boat financing

Divorce or litigation attorney

Surgeon at MT Sinai Hospital

Summer Internship for child or grandchildp g

HELOC

Trustee for addiction care trust

©2010 Wilmington Trust Corporation. All rights reserved. Please see the disclosures for important information.

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private wealth management summit December 7-9, 2014

Evolution of a Client Advocate Potential Client Pitfalls

LendingMortgage Recording tax Coop Flip TaxMillionaire’s Tax Proposed Excise Real Estate taxMargin Loan Guaranteed LoansReverse Mortgages LIBOR LitigationTax Exempts

Investing Perceived Risk Structured ProductsOption Strategies 770 accountsAnnuities ETFSYield – MLPs Wash SalesCyber Security PasswordsMadoffsMadoffs

TrustsBarbaro Trust – Pets Rowe’s TrustZealots Trust Genetic Material

©2010 Wilmington Trust Corporation. All rights reserved. Please see the disclosures for important information.

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Zealots Trust Genetic Material

private wealth management summit December 7-9, 2014

Fees

Cost -3% to have your wealth managed

Account level fee

Custody and brokerage fees

Mutual Fund expense fee ratios

Investment placement fee

Life insurance

Executor/ Trustee

30/50% prop trading feep p g

©2010 Wilmington Trust Corporation. All rights reserved. Please see the disclosures for important information.

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private wealth management summit December 7-9, 2014

©2010 Wilmington Trust Corporation. All rights reserved. Please see the disclosures for important information.

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private wealth management summit December 7-9, 2014

©2009 Wilmington Trust FSB. All rights reserved. 18

private wealth management summit December 7-9, 2014

Tactical Asset Allocation for the Personal Economy

Critical Annual Living Expenses MedicalTuition MortgageReal Estate Taxes InsuranceIRA contribution

ParentalParental529s and Tuition of Grandkids Annual GiftsBoomerang Expenses – funding your child’s adulthood Medical Payment Support

Aspirational 2nd Home Increased TravelB t/Pl Phil thBoat/Plane Philanthropy

©2010 Wilmington Trust Corporation. All rights reserved. Please see the disclosures for important information.

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private wealth management summit December 7-9, 2014

Languages of Wealth 1. Trusts - clat, clut, grat, IDIT, Roth, IRA, 529, 770, Credit Shelter, QTIP, QDOT

2. Market - alpha /beta, black pools, closed end funds, fat finger trading. ETFs,2. Market alpha /beta, black pools, closed end funds, fat finger trading. ETFs, spyders, systemic risk, HFT, inversion deals, tape tantrum, too big to fail, structured products, covered calls, guarantee, black swan, Venmo, Bitcoin…

3. Investment Degrees - FINRA, NASAA, GSRE, CFA, CFP, CMFC, CIPM, CPCU, CHFC, CPA, CLU, RR, RIA…

©2010 Wilmington Trust Corporation. All rights reserved. Please see the disclosures for important information.

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private wealth management summit December 7-9, 2014

Macro Challenges and Solutions

The sea of sameness

Loser’s game-400,000 brokers (est. 2016) competing to exceed market’s relative

indices

Economists track records and managers beating their own index

Trying to be right twice

Redefining and prioritizing the soft issues that have suddenly become the hard issues

Don’t have it? Need to be the resource of knowing the best place to get it

Educate your clients about the jargon

Assist the clients in giving back to the society and country that enabled them to become

wealthy

©2010 Wilmington Trust Corporation. All rights reserved. Please see the disclosures for important information.

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