Winners rationale

UBS has been reticent to call Hong Kong a home market but it would be justified in doing so. Having maintained a presence in the city since 1964, the Swiss bank today ranks as one of Hong Kong’s largest private banks and is in many ways the de facto face of an industry that views the market as a jewel in the Asia crown and, accordingly, ground zero in the battle for clients and talent.

UBS has continued to invest and innovate in Hong Kong where advantages are hard-earned and easily eroded. And, importantly, it has been unafraid to take calculated risks if the long-term upside points to a stronger, more sustainable franchise. Thus, though 2018 proved a challenging year for Hong Kong’s wealth managers amid heavy deleveraging and a pronounced slowdown in brokerage activities, the Swiss bank reaped the benefits of its consistent investment in the market.

This is especially true in the case of UBS’s Kowloon office, which now contributes sizeably to the bank’s Hong Kong market business and serves as the nerve centre for client prospecting by way of targeted thought leadership and lifestyle events. Indeed, the decision to open a second location in Hong Kong and has exposed the bank to an underpenetrated client pool in the form of local entrepreneurs and millennials and given UBS a strategic foothold in a recently proposed ‘wealth management connect’ that encompasses the Greater Bay Area.

Not only did the Kowloon office break even in 2018 — two years ahead of schedule — it has benefitted from the addition of a new country team amid a wider focus on talent management that has included major internal promotions. The emphasis the bank places on talent is also well-exampled by its ‘Hunters Club’ initiative — unique to the Hong Kong market business — which focuses on cultivating the skills of high-performing younger talent.

These efforts are paying dividends. The Hong Kong team continues to lead the APAC franchise in terms of NNM — up 30% YoY as at 3Q18 — and invested assets and revenue per client advisor rose markedly in 2018 despite a 10% YoY increase in full-time headcount. It also played a leading role in the uptake of discretionary and advisory mandates, thereby contributing substantially to a 25% YoY increase in fee-based revenue in Hong Kong. Moreover, client advisors registered a 100% participation rate in the sale of UBS’s flagship 100% sustainable investment discretionary mandate which raised north of US$400 million in the region as of January 2019, signalling a wind change in the way Asia’s private clients view ESG.

Ultimately, this was a complete and dynamic performance by UBS in what was a challenging year for all those in Asia’s most competitive private banking market. In 2018, the Swiss bank reaffirmed its reputation as a forward-thinking bank whose commitment to clients is beyond question and proved its well of new ideas is far from exhausted.

UBS is Asian Private Banker’s Best Private Bank – Hong Kong for 2018.