BNP Paribas continues to restructure its CortalConsors on-line retail brokerage and wealth management business. Having closed the investment banking branch of Consors Capital Bank AG in Frankfurt, CortalConsors has now sold its Swiss operation and closed its online brokerage unit in Italy because, as the French bank explains, they “don’t have the potential to show the critical mass on a stand alone basis within previewed time frame.” The time frame is the need for CortalConsors to break even in 2003.
Consors Switzerland, which is the third largest force in the Swiss onlinebrokerage market, is being sold to Swissquote. Consors Switzerland has 11,600 customers trading on 27 stock exchanges. Together, Consors Switzerland and Swissquote will be in a position to become a market leader. In Italy, competition on price in the on-line brokerage market had become too intense for CortalConsors, especially over the last two years. BNP Paribas says margins on heavy traders in Italy are four times lower than in France or in Germany.
CortalConsors will concentrate its development in Italy on the Independent Financial Advisor (IFA) business and on the distribution of savings products to private investors (such as mutual funds, life insurance and discretionary portfolio management).
“Despite the market environment we maintain our objective to realise our strategic plan and to break even in 2003,” explains Olivier Le Grand, CEO of CortalConsors. “Therefore, we currently check each and every engagement of the group and set up new adapted structures which will lead us to success. Our aim is to be No 1 in Europe – in size, in range of products, in services as well as in results.”
The restructuring follows the acquisition of Consors Discount-Broker AG by BNP Paribas in May 2002. The business is now being merged with the Cortal franchise BNP Paribas had developed in France. 24 internal workgroups are currently preparing action plans which will be finalised by November. They concern six countries: Belgium, France, Germany, Italy, Luxembourg and Spain.