For months, Alberica Brivio Sforza, head of Italian private banking at Lombard Odier, had been in talks with a small group of bankers serving ultra-high-net-worth clients. Just as she was about to poach the team from Italian rival Mediobanca, another financial institution swooped in with an offer they couldn't refuse. BNP Paribas' contract promised these bankers an upfront fee based on the assets they brought in, plus a substantial share of future business revenue—a package easily worth tens of millions of euros.
"For these people, it's a once-in-a-lifetime cash-out opportunity," Sforza said. "Essentially, all the results of their past work can be cashed in immediately on day one for millions."
Italian private banks are locked in a talent war, driving unprecedented signing bonuses in the ultra-high-net-worth segment. For institutions willing to pay top dollar, billions of dollars in client assets are up for grabs. To win talent, banks are offering upfront payments of 1%-3% of assets under management, plus roughly half of the portfolio's future revenue.
In Italy, this model is known as the tied agent contract. "Financial promoters" have long operated in Italy's mass-affluent wealth market, working for institutions like Generali and Fideuram, part of UniCredit. But until recently, the model was rare in high-end private banking. Under a tied agent contract, the banker acts as an independent advisor affiliated with a single institution, not a formal employee; they receive an upfront payment for moving client relationships over. Bankers typically commit to a 3-5 year term, and if they leave early, they must repay part of the signing bonus.
Over the past two years, the tied agent model has penetrated the ultra-high-net-worth segment, creating deep divisions within Italy's traditionally conservative private banking industry. Many view it as an aggressive hiring tactic. Executives anticipate the model will prove costly, yet find it hard to stay on the sidelines.
"These banks are essentially buying client books outright. They say, 'Transfer your assets and we'll pay you a percentage in year one.' We would never do that, and we never will," said an executive at a major wealth management firm. "I think this approach will ultimately backfire spectacularly."
The roots of the talent war trace back to the 2012 eurozone crisis and Mario Draghi's iconic speech as European Central Bank president, when he pledged to do "whatever it takes" to save the euro. A senior private banking executive said that brief statement was a turning point for highly indebted nations like Italy and Spain, convincing international investors that eurozone members wouldn't fall into an economic abyss. That declaration also sparked a flood of private equity capital into Italy.
"From 2012 until now, Italy's private equity acquisition market has been very active, and that's one of the core reasons for the expansion of the country's wealth market," said Alberto Chirillo, co-head of Goldman Sachs' continental European private wealth management business. Private equity firms have been aggressively acquiring Italian assets, mostly small and medium-sized family businesses. Bankers call these companies "hidden gems": they typically carry low debt and hold ample cash reserves. A wave of liquidity events has allowed Italian entrepreneurs to cash out hundreds of millions of euros, making them prime targets for private banks competing for their business.
Swiss private bank Pictet and the Politecnico di Milano's School of Management estimate that between 2013 and 2025, Italy saw nearly 3,500 transactions totaling around €362 billion; over the next decade, the country is expected to produce another 3,900 deals worth close to €350 billion. Italian private banks' assets under management hit a record €1.4 trillion by end-2025—double the level of a decade ago, according to the Italian Private Banking Association.
"Thanks to domestic family businesses, Italy's mid-market and upper-mid-market M&A opportunities are incredibly rich," said Rob Mullan, Goldman Sachs' co-head of private wealth management for Europe, Middle East and Africa. "Italy is one of our fastest-growing markets."
Italy's ultra-high-net-worth market is dominated by international institutions, including Goldman Sachs, JPMorgan, and Switzerland's UBS. JPMorgan is notably absent from this arena, having sold its private wealth business covering the UK, Italy, and the Middle East to Credit Suisse in 2013—which was then acquired by UBS in 2023. Facing an increasingly competitive market, domestic banks and smaller European institutions are turning to the tied agent contracts that larger players have shunned.
"The talent war is definitely intensifying," said Sara Catania, JPMorgan's head of continental European private banking. "We always want our employees to aim for long-term development with the company, which aligns with how we build lasting relationships with clients and their families. Long-term business requires stability, so we don't encourage staff to chase short-term gains."
Over the past 18 months, a wave of M&A in Italian banking has further fueled competition, notably Banca Monte dei Paschi di Siena's acquisition of Mediobanca Milan. Mediobanca is a benchmark brand in Italian wealth management, and rivals have been poaching its private bankers. Multiple executives told the Financial Times that everyone is competing for talent deeply embedded in the ultra-high-net-worth space. Sources say dozens of employees have already left under tied agent arrangements to European peers like BNP Paribas and Deutsche Bank, as well as domestic institutions like UniCredit.
In June, UniCredit and Italy's fifth-largest bank BPER launched a €30.6 billion takeover bid for Banca Monte dei Paschi di Siena. If successful, UniCredit would gain Mediobanca's highly valuable private banking business. But the Italian M&A market has seen a twist: Monte dei Paschi subsequently launched takeover offers for two other competitors.
Several executives warn that some of the contracts used to lure talent are not economically rational. One executive at a top Italian bank described the past year's competition as "almost barbaric," noting that "banks are fixated on asset growth, but what they end up with is growth without profit quality."
According to Lombard Odier's calculations, tied agents now account for over 60% of Italian private bankers as of March, but the vast majority still serve mass-affluent clients. The model is more viable in that segment, where clients typically pay high recurring service fees and banks enjoy higher returns on assets. Ultra-high-net-worth clients, by contrast, have strong bargaining power that compresses fees, and they demand bespoke investment solutions rather than standardized products, driving up service costs and quickly eroding asset returns.
"The tied agent model works for ordinary clients with account returns of 2%-4%; but in the ultra-high-net-worth segment, returns drop sharply and the model theoretically breaks down," Sforza said. She added: "I firmly believe this race will eventually end. These banks will never make money off the bankers they've hired—the price is simply too high."
Comments