Doug Conick, newly appointed president and CEO of Manulife Bank of Canada, wants to take strategic advantage of shifts in the financial advice that baby boomers need as they edge closer to retirement.

Conick says financial planning is moving beyond asset allocation to product allocation as clients strive to create income and preserve wealth. Financial advisors need to help their clients devise strategies and develop a discipline around managing their debts as well as their assets, he says. At the same time, clients need assistance getting the most interest income out of their short-term cash accounts. This is where Manulife Bank, based in Waterloo, Ont., hopes to play an increasingly important role.

The bank, wholly owned by Manulife Financial Corp. of Toronto, was established in 1993 as Canada’s first advisor-based bank. It offers a wide range of products that advisors can recommend to their clients, including the popular Manulife One account. That product combines a mortgage with a high-interest chequing account and line of credit. Clients of Manulife Bank can also access other Manulife products, such as regular mortgages, high-interest deposits, credit cards, and investment and RRSP loans.

“Our mission is to work with financial advisors to incorporate banking strategies into every client’s financial plan,” says Conick, 41. “We are looking to broaden our existing relationships with advisors, as well as develop as many new relationships as we can within the advisor network.”

The advisors Manulife is cultivating — both inside and outside the Manulife organization — have already developed close relationships with the end-clients, Conick says. These advisors are familiar with clients’ financial personality, investment goals, assets, income and family situation.

ALL-IN-ONE PRODUCT

“Manulife Bank can plug in and help advisors offer superior service,” says Conick. “We give advisors a leg up, and make it easy for their clients to deal with our bank. Our products and service meet a need, and we offer an experience that is not readily available elsewhere.”

The Manulife One account product — Manulife Bank’s key product — has chalked up asset growth averaging 47% annually since it was introduced in 1999; it makes up about 85% of the bank’s assets, which total about $16 billion.

Manulife One is an all-in-one product that allows clients of financial advisors to hold their mortgages, lines of credit, chequing accounts and credit cards in the same account. Clients then have flexibility in paying down their mortgage or extending their lines of credit, providing they continue to meet the 20% equity requirement, based on the value of their home. Many clients find it worthwhile to pay off other high-interest loans with their Manulife One line of credit, and have one consolidated loan at an attractive rate of interest.

“Our product offers simplification and potentially faster repayment of the mortgage,” says Conick. “The advisor plays an important role in helping with the necessary discipline.”

With Manulife One, clients are able to see their entire financial picture with a single statement, and that helps focus their attention, Conick says. And thanks to the guidance of financial advisors in helping clients with money management, he adds, Manulife Bank’s problem loans are a mere fraction of the rate in the banking industry overall. Impaired loans as a percentage of assets are 0.03% at Manulife Bank, well below the 1.27% average for Canadian banks, according to the Ontario Superintendent of Financial Institutions.
@page_break@Manulife Bank’s products are sold through Manulife advisors as well as through a network of 180 Manulife “mobile advisors,” who support independent financial advi-sors across Canada throughout the securities and insurance product distribution networks. Advisors are typically not qualified to sell banking products such as mortgages directly, nor can a client buy them independently through the Manulife call centre or website. Manulife’s mobile advisors work in co-operation with outside advisors to incorporate banking products into a client’s financial plan. Independent advisors receive a referral fee when a product is purchased, as well as an ongoing trailer fee. Manulife mobile advisors meet with clients and advisors at their choice of location and on their schedule.

“The key is to show advisors the benefit of our products in the planning process,” says Conick, who is focusing relentlessly on expanding the advisor network. “Advisors must be holistic and look at both sides of the client’s balance sheet. Often, the mortgage is the biggest liability, and clients need advice in using their lines of credit efficiently.”

Manulife has relationships with a variety of securities dealers, mutual fund dealers and managing general agencies, but one of its most important ones is with Edward Jones, a dealer with 750 offices across Canada and seven million clients.

MARKETING FOCUS

New Manulife banking products are in the works, and some existing products are due to receive a stronger marketing focus under Conick, who has been in his new job since April. For example, complex insured retirement plan strategies for affluent clients that involve borrowing have strong growth potential, he says. Mortgages outside of the Manulife One product will also be receiving some attention, and it’s likely that a stand-alone, variable-rate mortgage will be introduced to complement Manulife Bank’s existing fixed-rate mortgage.

In addition, Manulife Bank will be launching its Manulife Trust subsidiary later this year, and new estate planning products will be made available. Conick would also like to raise the profile of the Manulife Business Advantage Account.

“There are a significant number of small businesses in Canada, and most advisors have small-business clients,” Conick says. “Typically, their cash float sits in a bank account earning zero interest. Our value proposition allows for greater simplification and the ability to earn healthy interest on excess cash.”

Part of Manulife Bank’s growth strategy is a commitment to service, starting with the Manulife representatives in the field and filtering through to a call centre and website, Conick says. Quality must be aligned in the product and the service, he says: “There could be an opportunity to introduce a great product, but if the customer experience is going to be eroded by a lack of alignment in service, we would not pursue it. It’s necessary to make choices and to focus.”

Conick first joined Manulife Bank two years ago, originally as vice president of sales, marketing and product development. Prior to that, he was at Manulife Financial for 10 years, overseeing investment fund products for the individual wealth-management division as well as spending some time in Japan working as financial controller. He played a key role in the development of the Manulife IncomePlus product, the first guaranteed minimum withdrawal benefit product to be introduced in Canada.

Banking is not new to Conick. Although he has a chartered accountant designation, his early work experience included stints at Bank of Montreal in Toronto and other parts of Ontario, and at Royal Bank of Canada in Toronto.

After his banking experiences, a colleague who had left RBC for Manulife persuaded Conick to join the insurance company. Initially, he worked on the finance side and later became involved in the evaluation of various insurance companies that Manulife was acquiring as part of its expansion strategy. He saw the potential of wealth-management products — such as mutual funds and segregated funds — and later moved to that side of the business, which is how he became involved with development of Manulife One.

Although Conick works in Manulife’s Waterloo headquarters, he continues to live in Burlington, Ont., just outside Toronto, where he grew up and which he sees as a great place to raise his children, an eight-year-old daughter and five-year-old son. “It’s about a 45-minute drive to work,” he says, “and I can think on the way in and unwind on the way home.”

IE