There is a “severe shortage” of relationship managers (RMs) in Hong Kong and Singapore as Chinese firms look to build out their international wealth management operations, according to Sid Sibal, financial services manager at Hudson Hong Kong.
“There has been a big increase in demand, especially by Chinese-backed brokerages who are stepping up the expansion of wealth management operations in Hong Kong as they target increasingly affluent Mainlanders with a growing appetite for offshore investments,” Sibal told Asian Private Banker.
Several Chinese private banks have set up shop or bolstered their presence in Hong Kong and Singapore this year. China Merchants Bank, China Minsheng Banking Corporation and China Construction Bank have opened four offshore private banking centres between them in 2017, spread across Asia’s two primary booking centres.
Sibal says that as a result of this trend, there is a deficiency of RMs in the region, adding that Hong Kong is leading Singapore “by far” in terms of hiring demand.
In 2016, Asia’s (ex-China onshore) Top 20 private banks by RM headcount saw their collective frontline increase by 6.9% from 5,203 to 5,459, following a 50 person net decline in 2015, according to Asian Private Banker data.
However, Sibal says that the industry as a whole is not doing enough to groom talent amid the shortage.
“Only a few tier-one FIs [financial institutions] have set up their own wealth academies who develop organic talent and newer or next generations of RMs,” Sibal said, adding that “the newer Chinese banking platforms do not have this capability at the moment”.
A number of the region’s largest private banks have rolled out training initiatives in recent years, and more are in the pipeline.
UBS Wealth Management is in the process of establishing a new certification programme in Hong Kong with the Private Wealth Management Association (PWMA) in an effort to “professionalise” the RM population, Markus Tanner, UBS University’s Zurich-based head of business academy, told Asian Private Banker this month.
And besides corporate-driven programmes, industry bodies have also sought to address the skills gap. In Hong Kong, two new internship programmes were launched this summer.
Sibal says the biggest skills deficit facing the industry at present is the lack of RMs with books of UHNW Mainland Chinese clients.
Compliance functions still being bolstered
Norris Wong, senior consultant at Hays Hong Kong, told Asian Private Banker last week that “significant movements” have been observed within “mid- to senior-level” compliance functions in Hong Kong.
“When one person moves, there’s a game of musical chairs to replace an existing vacancy,” Wong said, noting that by changing firms, compliance professionals on average earn 15-20% more.
“Compliance remains one of the hottest areas in the banking sector,” Wong added. “Candidates with sound regulatory knowledge and good business acumen are still in high demand and come at a premium.”
Meanwhile, a number of wealth planning heads and executives at private banks in Asia have told Asian Private Banker that finding quality personnel for their teams is highly challenging.
Sheau-Yuen Tan, head of wealth planning for the Asia Pacific at Deutsche Bank Wealth Management, says that when she was hiring a wealth planner last year, “it was very difficult to find a good planner with the right ability to engage clients and bankers”.