What impact have the unprecedented global social, political and fiscal challenges had on your bank this year? What are your key growth markets in terms of net new money? What will your focus be in 2023?
The heads of five private banks addressed these and other questions at the Asian Private Banker Summit 2022 in Singapore on 1 December.
Kiatnakin Phatra Securities
Narit Kosalathip, head of wealth management, of Kiatnakin Phatra Securities, said revenue had contracted a small amount this year but net new money inflows contributed to an increase in AUM. Phatra has been advising clients to invest in structured products and private markets.
Individual Thai investors have less of an appetite for ESG investments due to a lack of awareness, he said. “However, on the corporate side there is much more interest. And we have started to put together an ESG framework and criteria for new product selection.”
When asked about global banks setting up onshore operations in Thailand, Kosalathip said “competition is obviously increasing, but clients tend to view local banks and global banks differently in terms of value proposition. If they want a global exposure they will go to a global bank and not Phatra, but if they prefer more onshore exposure our platform can offer value proposition.”
He added that Thailand still has capital controls, making it difficult for local investors to invest in global markets. “We are in a place where the ecosystem is not complete, and we need to build the ecosystem by ourselves in order to provide access for clients. There’s still some room for improvement in terms of regulation,” Kosalathip explained.
Next year UBP’s focus will be on fixed income and alternatives investments as well as China, pointed out Asia CEO Michael Blake, who is “super bullish on Hong Kong.”
“It’s impossible to ignore Hong Kong because when I look at our business flows and where the wealth is in the region, Hong Kong continues to play a very important role for us in the future,” he explained.
What he counts as development for his bank this year “has really been China, where we’ve established a new entity and secured QDLP (Qualified Domestic Limited Partner) quota – and that has enabled us to offer offshore investments to domestic clients.”
UBP has also seen new business this year from Middle East investors looking to book in Asia, as well as in some of your core markets like Singapore and Greater China.
“Middle East in particular, and also more generally international clients, see opportunities for investment in Asia and want to tap into those opportunities. The growth of family offices in Singapore is also a real opportunity for all of us here,” he said.
HSBC Global Private Banking
Philip Kunz, HSBC’s head of global private banking for South Asia, said this year has been tough but at the same time rewarding, thanks to HSBC’s one universal banking model. The bank continues to leverage Singapore’s position as an ASEAN hub to provide private wealth solutions to clients.
Indonesia and Thailand have contributed the most net new money over the years by far, but it has also come from Australia and increasingly Vietnam. “Thailand in particular sticks out,” he said, but [there is] also “the attraction of Singapore for international markets,” to book in Asia.
HSBC is continuing to help to moderate the conversations between the different generations about wealth transfer “because they actually find it quite difficult to talk to one another,” Kunz said.
“ESG is very often driven by the next generation, so we are constantly looking for more investable opportunities for them,” he added.
Maybank is also generating more profit across the whole wealth business than 2021. There has been a net increase in AUM, said Alvin Lee, head of group wealth management.
Maybank’s premier banking business has an onshore presence in Indonesia, Philippines, and Cambodia. The private banking business is also focused on Singapore, Malaysia, and Hong Kong.
He said clients are becoming increasingly sophisticated, especially in the Philippines and Indonesia. Traditionally interested in primary bond issuances, they are now open to secondary markets.
Muslim investors are also becoming more interested in Islamic solutions and wealth management expertise generally, Lee says.
Indosuez Wealth Management
At Indosuez, Asia CEO Omar Shokur has been focused on strengthening what the bank offers its onshore clients in Singapore and Hong Kong, while also focused on other Asian markets such as Taiwan and China.
He said this year’s market volatility has brought short-term challenges, as well as the long-term challenge of making sure the business grows in Asia.
“We made net new money from existing and new clients, mostly cash. It has helped us grow the assets,” Shokur said, adding that Indosuez has added more bankers in Singapore and Hong Kong.
“We have also organised our strategies by market to have a more focused approach, because competition is becoming more and more difficult. For example, we look at geography for new business segments and slowly become more dedicated to take care of those areas,” he said.
Shokur is expecting technology and innovation companies to lead the ESG space. “Companies in this space will lead the targets related to net zero. They will have a tremendous impact on the outperformance compared to their competitors,” he said.