How are you pushing for growth in Asia amidst Chinese private banks dominating the region's wealth management business?
It is quite clear that Asia is a powerhouse of global wealth creation. According to the Capgemini Asia-Pacific Wealth Report 2017, the region continues to top high network individual (HNWI) population and wealth; and this is expected to grow, driven by shifts of geography of global influence, as Asia and in particular China continues to grow in stature. However, the wealth management industry remains fragmented, with different offerings and structures.
I don’t believe, however, that it is a zero-sum game, and that we each can offer clients something different and distinct - at UBP, we occupy a very particular space as a pure play Private Bank. We are focused on the UHNW and Family Office space, where we are able to showcase our expertise in developing bespoke investment, wealth planning and asset protection solutions. In this regard, I would say, we are a niche player, and our approach is different from the mainland Chinese private banks.
The mainland Chinese clients today are more open to the idea of an international wealth management relationship than they were ten years ago, when they were focusing on growing their businesses. Back then, the best thing they could do was reinvest excess capital into those businesses. This has obviously changed - the economy in China has matured, and the clients have become more international in their outlook, and become far more open to a conversation around diversification and classic wealth preservation solutions, which we are very well placed to provide.
"Asia is clearly one of the drivers for the bank’s growth globally, and we have the ambition to grow."
Our CEO, Guy de Picciotto, has set a medium-term target, of within five years, for the bank to achieve 30% of its total AUM from Asia, along with an increase in overall assets, but we will do so, in a sustainable and profitable manner.
What makes UBP different compared to local private banks in the region? Are there any trends from your Swiss business that you are adopting in Asia?
We are different, because we are focused on doing one thing, and the one thing that we are good at, which is wealth management for private clients and institutions. The fact that we are privately owned provides us with a long-term view and a very good understanding of the needs of entrepreneurs in Asia, particularly the Chinese entrepreneurs with whom, we can demonstrate an alignment of interest and understanding. Being privately owned also means there are no big layers of management to get through, which allows for quick and direct decisions to match the expectations of our clients.
Our DNA also includes a strong expertise in alternative investments such as Hedge Funds where we have strong advisory capabilities, and also in Direct Investments, where we are able to offer our clients the opportunity to invest in private deals and companies in a unique manner. We also have a unique approach to our long-term portfolio recommendations, which aims to preserve the wealth of our clients whilst being structured around personalised mandates.
As most of our clients are active entrepreneurs who take risk in their businesses, our discretionary capabilities provide a robust and diversified management of their personal wealth, whilst mitigating risk and taking a long-term aim to help them transfer this wealth to the next generation.
What are the most pertinent challenges that you have encountered in the private banking industry in Asia? How are you addressing these challenges?
One of the main challenges for us is to hire skilled and experienced bankers. The talent pool in the region, unfortunately, is not big enough and all banks are fighting for the best bankers.
In this context, our first objective has been to retain our relationship managers and I think we have been fairly successful in ensuring that our team of relationship managers feel empowered, respected and aligned to what the bank stands for, as demonstrated by a very low turnover. Secondly, in terms of new bankers, we do not have any specific target for hiring a certain number of bankers each year – we are very selective – it is not just a volume game, where one goes out to hire as many as one can. We look for highly experienced bankers, with some 10-20 years of experience behind them, who are able to leverage on our broad range of tools, products and services to customise bespoke solutions that would meet their clients’ needs. We look for senior bankers who are excited by the opportunity to be entrepreneurial like the client, excited to create something long lasting, and who have the confidence to stand by the advice they give to the UHNWI client.
What do you consider as your biggest achievement so far as the head of North Asia and CEO of Hong Kong branch at UBP? How has the company progressed under your leadership?
"I am very proud of the team’s achievements."
We have been able to:
- grow the North Asian business by over 40% since April 2016.
- grow revenue and ROA above expectations over this same period of time.
- become profitable - our operations in Hong Kong have been profitable after one full year of activity in 2017, which is a remarkable achievement.
- successfully integrate two teams of new bankers in 2016 and 2017, whilst creating positive synergies with existing teams. All this combined to allow for a rapid growth of business.
What goals will you be focused on in the next 3 to 5 years?
The road map for us is very clear. We want to continue growing in Asia – a growth that continues to be profitable, sustainable and in line with the Group’s values and ambitions. We will continue to capitalise on our agility and flexibility to better serve our clients and provide value to them.
At a time when the wealth management industry is undergoing transformation and transition, the only KPIs which are relevant to us, is to ensure the quality of service and the investment return to our clients from the advice provided by our private bankers. Our goal is to continually do better in these areas. As a pure play private bank, our client’s satisfaction is a priceless reward, and continuing to serve these families for generations is our “raison d’Etre”.
Market Head North Asia