Amid rising geopolitical tensions and volatile markets, what is the secret to success in Asia’s private banking space in 2024? According to leading private bankers at the Asian Private Banker Summit 2024 in Hong Kong, staying close to clients is key.

Leading up to the Summit this week, Chinese markets had experienced a roller coaster ride. They had first seen strong golden week gains on the back of announced government intervention measures, only to then come tumbling down on Wednesday as spending data and further stimulus failed to live up to expectations.

“With the (China) stimulus measure and also the improved client sentiment, we have also seen appetite picking up in equity, or some of the balanced portfolios as well,” Amy Lo, chairman of Global Wealth Management Asia at UBS Global Wealth Management (UBS GWM), said at the summit on Tuesday, which had about 500 industry attendees.

“Last week was one of the record weeks in terms of the transactional volume,” added Lo, referring to trading activity by UBS GWM clients in Asia.

Rickie Chan, chief executive for the Hong Kong branch and head of private banking for Greater China at Bank of Singapore (BoS), also observed a significant jump in client activities after the recent China market turnaround.

“A lot of our clients have a lot of dry powder on the side-line. We saw the stimulus. I think it is positive for clients from the investment point of view. A lot of them want to talk to us and ask for ideas. I believe this is very positive for the industry,” he said during the summit.

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Deep client engagement is key

One of the key issues for private banking CEOs in 2024 has been high deposit rates, which have lessened the appeal of relatively riskier investment products.

But Lok Yim, regional head of private banking for Asia Pacific at HSBC Global Private Banking (HSBC GPB), has enjoyed a strong start to the year on the investment front after taking up his new role in January. In 1H24, HSBC GPB attracted US$38 billion of NNIA in Asia, which he attributed to deep client engagement.

“We are spending a lot of time on client events with our partners, with the product specialists, and freeing up time for our bankers to spend time with clients,” he said.

Meanwhile, he said that the data analytics and the sales management tools deployed by the bank over the last nine months have made a huge difference.

“We’re having deep conversations. Our bankers are out there constantly, in every country, in every location, with our partners and having that conversation. Ultimately, if you have the right conversation with the right clients at the right time, the right things happen,” he said.

UBS GWM’s Lo also believes staying close to clients is vital for growth, and has helped position clients for market opportunities, including those in China.

“Months ahead, we’ve been talking to clients and updating our CIO view […] Our clients also value our CIO content. That helped in doing the proper kind of asset location to capture the opportunity. [For instance], why we have the call, and how we can play tactically on some of these market moves,” she said, in relation to recent market events in China.

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To target the ultra high net worth (UHNW) segment, Bank of Singapore’s Chan said the lender continues to invest in its platform and product offerings, believing this segment is a huge opportunity for the bank.

“We have a lot of success in that space, especially in discretionary portfolio management. We have grown that part of business by double-digits in the past six months, and our year-to-date growth subscription as of the end of August has already exceeded the entire year in 2023,” commented Chan.

Private markets

With private market investments drawing ever more attention from clients, private banks have been keen to differentiate their offerings from their competitors. Chan shared that apart from the big household names, BoS has also sourced some niche players in Asia, with time-limited exclusivity arrangements for many deals.

“We are an Asian bank. And we have the Asian knowledge […] We selectively offer very high-performing funds in the alternative space which are hard to get in,” he said.

For Yim, having an asset management company under the HSBC Group is a blessing, as it allows clients to co-invest with the bank’s own alternatives arm, he explained.

“We’re bringing this to different segments, whether it’s through our full advisory mandates, through direct investments for UHNWIs, through the wealth continuum for even our private clients holding US$5-6 million,” he said. “It is thinking through what fits for what right clients at the right time.”

Lo explained that UBS has set up what it calls the Unified Global Alternative to bring together different capabilities from asset management, investment banking and wealth to serve its clients.

She has also observed a trend of ‘democratisation’ in bringing private investment offerings to the high net worth segment. “In the past, it is more for the UHNWIs and the global family offices. We are now also launching it to the HNWIs and that’s also highly appreciated by the clients,” she said.

Strategic priorities

While the integration of Credit Suisse is the priority, UBS also laid out its Asia Pacific growth plan. Lo said the bank will continue to use Hong Kong and Singapore as hubs while enhancing its presence in Australia, Japan and Taiwan.

UBS is also aiming to grow the onshore China and India markets over the long term. “We have had a long discussion on China, because we have a very strong presence in China domestic as well as [through our] international franchise,” she said.

As newly installed CEOs, Chan and Yim take fairly different approaches to their hiring strategies. BoS has previously stated its goal of having 500 relationship managers by the end of 2025. Chan said the bank has close to 460 RMs as of October.

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“We have increased the front office population by 20% in the past six months. We are taking a pause in terms of hiring for the front office. Now we focus on hiring people for the middle to back office to support the growth of the front office,” Chan said.

“I think we are taking advantage of the market situation. We have been very successful in hiring top-quality talent on the street,” he added.

Yim, on the other hand, said he was not focused on hiring this year. “My bankers are super smart. My product team is super smart. The culture we have is amazing. I just need to find [a way] to realise the potential. So that everything they do, no energy is wasted.”