Behavioral Finance for Private Banking, 2nd Edition

CHAPTER 13Case Studies

To wrap‐up the insights from this book, we now consider three case studies. The first is a case study taken from the “Bilanz Private Banking Rating.” The second is taken from our research project “Behavioral Finance for Retail Banking,” which was financed by the Swiss National Science Foundation. The third case study illustrates a goal‐based investing approach.

Concerning the “Bilanz Private Banking Rating,” its purpose is to check the quality of private banking in Switzerland and to give annual feedback to Swiss banks regarding how they can further improve. The results are published in the magazine Bilanz (http://www.bilanz.ch/), which has a large readership and a high reputation in Switzerland.

The “Bilanz Private Banking Rating” includes the following stages:

1. A real client is selected by the jury president with the help of a journalist from Bilanz. In this first stage, the client's case is written.
2. Request for proposals: A letter presenting the case and asking for written advice is sent to approximately 80 banks in Switzerland.
3. The jury makes a first screening of the proposals that were sent in and preselects the best 15 or so. These are sent to IVA¹ for a quantitative analysis.
4. The jury makes an in‐depth analysis of the quantitative results and complements them with its own qualitative judgment.
5. Three banks are invited to present to the client in front of the jury.
6. Advised by the jury, the client selects the favorite bank.
7. Bilanz publishes its reporter's ...