Bahren Shaari, chief executive officer, Bank of Singapore shares his views with Asian Private Banker in the ‘Final Word’, a ten-part series where the industry’s leaders share their thoughts and opinions on key issues around industry trends, business performance, investment solutions, regulations and compliance, and technology.
Industry Trends | What is the state of Asia’s talent pool and did your firm pay significantly higher for new talent? What is your view on private banking talent development in Asia?
The reality that all organisations — not just private banks — face today is that we operate in an open market environment where it is no longer a norm for an individual to be staying in the same workplace or doing the same thing throughout their career.
At Bank of Singapore, we are selective and bring on board those who can value-add to the existing pool of talents we have. Beyond the monetary rewards that a private banker may bring, we seek those who have the right attitude, always want to learn, and are adaptable and innovative. We focus on having a pipeline of internal talents who are able to step up whenever needed and we strive to excite them with interesting projects and assignments so that they find meaningful career opportunities within the organisation.
Since BoS’s inception, talent development has been a key pillar. We’ve invested more than US$35 million in HR initiatives and talent development programmes and will continue to invest heavily. Given today’s fast-paced environment that is disrupted by technology, ‘future skills’ is a central theme for us and we develop our talent pool by building skill sets and new capabilities through areas like digital, design thinking, and data analytics to meet the evolving needs of clients.
Industry Trends | How important is it for your business to make substantial inroads in China to ensure sustainability and growth over the next decade?
It’s no secret that the number of high net worth and ultra high net worth individuals in China is one of the fastest growing in the world. A substantial proportion of our net new money in the last few quarters has come from the region through our offshore business. Our Hong Kong branch is strategic in that it gives us access to the Greater China market. We will continue to invest in the region, which is one of our core markets.
Business Performance | In the midst of what has been construed as an increasingly difficult macroeconomic environment, how do you think the private banking and asset management industry will perform in 2019? Will it be a year to separate the wheat from the chaff?
Trade tensions are at the forefront of everyone’s minds right now. We have not felt that great an impact so far on our AUM — in fact, our AUM is still growing steadily. However, we predict that next year would be tougher, especially if Trump extends the tariffs on an additional US$250 billion worth of goods as he has threatened to.
When markets are volatile, that’s when good private bankers will stand out from the rest. A good banker would be able to help keep clients calm and trust in their investment portfolio to ride out the storm.
Investment Solutions | Though continued geopolitical uncertainty and volatility pose a challenge for DPM performance, will this ultimately prove to be a boon for the discretionary business, converting clients from trade to delegation? In these same market conditions, how critical will the alternatives business be for private banks in Asia moving forward?
It is during periods of market volatility that DPM actually plays a bigger role and clients start to see the real benefits of DPM. Our AUM under DPM has grown by double figures on a year-on-year basis. About one-third of the growth in DPM has come from existing clients, an indication of their growing confidence in our capabilities to manage their portfolios and help them ride out the storm. Alternatives has been our focus this year as we anticipate increasing market risks and look for asset classes with lower correlation. We will continue to maintain this strategy in the coming year which is not likely to be any less challenging than this year.
Meet 2018’s industry leaders in the full round up of of Asian Private Banker‘s the Final Word 2018.