As Thailand emerges as a potential hotspot for wealth management, international players in the region are aiming to differentiate their offerings to capture AUM and talent in this growing market.

This is according to senior executives at this year’s edition of Asian Private Banker‘s annual Thailand Private Banking Leaders Conversation. The Bangkok event drew a full house of senior executives, private bankers, and product specialists in wealth management from both domestic and international circles.

“Thailand is on everybody’s radar when it comes to wealth management, so there is a certain pressure for everyone to make it happen,” said Adrian Mazenauer, CEO and head of wealth management at SCB Julius Baer.

“For the ones who work here, we all know, there is a war for talent, and we’re somewhat facing the same clients as well.”

Intl banks’ differentiation strategies

SCB Julius Baer divides clients into two broad categories: red ocean and blue ocean. It understands the “red ocean” clients as Thai billionaires who have invested globally for generations. For these clients, the bank competes on price, speed and product.

“Blue ocean” clients, on the other hand, are new to international private banking. The bank supports these clients through its collaboration with Siam Commercial Bank, and seeks to win them over by building relationships with the clients’ entire family and with quality personal advice.

“Not everybody can give good advice. You need to explain to a client: how does an investment fit into the portfolio? Why does it make sense for the client? It’s how you slice and dice it,” said Mazenauer.

With family business owners representing over 80% of businesses in Thailand, HSBC Global Private Banking (GPB) leverages its commercial banking strengths through internal collaboration to address clients’ capital-raising and capital-financial advisory needs. The bank has also been introducing clients to its network in Singapore and Hong Kong to get deals to engage clients on both business and personal wealth management fronts.

“The beating heart of HSBC is commercial banking. That’s what drives us across regions,” said Benjamin Wang, global private banking head desk for Thailand at HSBC GPB. “It’s really helpful to have partners from commercial banking join us in meetings.”

At BNP Paribas Wealth Management (BNP Paribas WM), its model of being based in Thailand but booking client assets to its Singapore platform grants clients access to its offshore private banking products and services.

“If you drill down at the product level, you need a strong platform. We have a very strong alternative shelf, structured product solutions and trading flow,” said Daniel Peter, CEO, wealth management, Thailand, at BNP Paribas WM.

Talent war 

With a majority of hires having worked in Singapore and Hong Kong before, SCB Julius Baer focuses on hiring relationship managers (RMs) with long-term experience in managing offshore portfolios through different cycles.

“We talked a lot about global platforms and reach, that is all well and true. But the last mile between the whole wide world and the client is the banker. If the banker is not well trained and experienced, not fully supported and therefore not confident, everything behind falls apart,” said Mazenauer.

As for HSBC’s Wang, having a client-focused mentality is important. Wang expects RMs to have a strong desire to be part of clients’ wealth journey, encompassing wealth accumulation, management, and preservation.

“With that mindset, everything just falls into place,” said Wang. “We want to hire people and make them great. That’s always been our strategy at the bank.”

Friends or competitors?

When convincing Thai clients to bank internationally, BNP Paribas WM recognised a need to change its sales process to put a greater emphasis on education. While the education process takes time, Peter believes this is helped by more global players entering Thailand’s wealth space.

“The more competitors come up, the more platforms do a similar approach, the more the clients hear the same story and from more different angles. In that space, we are not competitors. We are actually friends who drive each other’s educational story,” said Peter.

This need for education is echoed by Mazenauer, especially when encouraging clients to invest internationally, even during market downturns. As a result, SCB Julius Baer has been educating clients on how their decisions align with the family’s larger wealth pool and expectations.

“It’s easy to tell a client: ‘Trust me, I’ve been in private banking for 25 years, this is the best product.’ And you might get away with it,” said Mazenauer. “But this is not right, it is better that you have explained your recommendations from the beginning, the more clients know, the better it is.”