German banks are reticent when it comes to revealing how they deal with different types of customers. Private banking in particular, says one insider, is something "one doesn't like to talk about, for fear of arousing social envy". Especially reluctant on this front are Deutsche Bank and Dresdner Bank, which last year were finalising merger plans.

Mass customer protests broke out last year when a Dresdner Bank director announced that once the merger was completed, the bank would retain only customers with over e102,258 (£62,275) in assets. Anyone with less would be regarded as a "basic customer" and shunted off to the new Bank 24. Four million such customers, and companies with turnovers of less than e2.55m (£1.55m), would be dismissed. In response, many customers closed their accounts, adding to the woes besetting the merger plans and contributing to its failure.

Today, at Deutsche Bank, a distinction between "personal" and "private" banking does exist. The former covers both Deutsche Bank 24, with its standard products, and all electronic banking business. Although publicly the bank rejects the idea of segmenting its clientele, it recently introduced a "private" consultancy service. Customers can authorise Deutsche Bank to manage their assets for them or request daily share purchasing advice to help them make their own decisions. The bank also advises on investments such as property, precious metals and art.

Every Deutsche Bank customer can take advantage of this personal consultancy service - provided they pay for it. Thus, private banking is not available on the basis of how much a customer is worth but on how much advice he needs. In this respect, Deutsche Bank's strategy differs from the other German banks.

Personal consultancy starts at e300 (£183) a year and is staggered according to assets: investors with small amounts pay proportionately more than those with larger assets.

Dresdner Bank offers "private" banking only to its top customers, those with assets worth at least e1m (£609,000). For international investors investing in property, art and other assets, Dresdner offers an international programme in which investments are handled locally through the bank's worldwide infrastructure. In both cases a small team works exclusively for the customer: securities, financing and property experts are available if required and the customer's tax consultant is also involved.

A similar model has been running at Commerzbank for the past two years. The private banking team consists of 13 employees who advise high net worth individuals on asset management, loans and securities. Individual asset management is available for those with more than e500,000 (£304,500). Here customers indicate how many shares the bank can buy and set an upper limit for fixed-interest securities; they can also exclude certain shares or state preferences for particular sectors. International private banking is also available but is designed primarily for customers living outside Germany.

www.comdirect.de
www.db24.de
www.dresdnerbank.de

christiane.schulzki@t-online.de