Global Private Banking Awards 2014: Winners’ Profiles – National Winners (Middle East and Asia)

Best Private Bank in China
China Merchants Bank

Although China Merchants Bank had first mover advantage in Chinese private banking, having entered the sphere back in 2007, its managers, who hand out copies of the treatise The Art of War to clients, written by ancient military strategist Sun Tzu, know that major competitors are breathing down their necks. Among the most feared rivals is ICBC.

In order to combat this threat, CMB has been strengthening its private banking facilities, now accounting for 32 specialist centres in 27 key cities, serving 25,500 clients.

In 2013, private banking efforts at CMB were devoted to promoting an investment consulting service, expanding an open product platform which has been the distribution target of boutique Western asset managers and popularising the concept of trusts and other cross border financial services.

One specific change is a realisation that Chinese clients are increasingly prioritising wealth protection and facilitating inheritance, rather than multiplying assets, as the investment mindset becomes more mature and stable. In addition, the bank is also trying to provide investment scenarios of a more cross-border and diversified nature, in accordance with client wishes.

CMB is also slowly spreading out its tentacles, having opened branches in Hong Kong and Singapore, offering access to greater numbers of global investment products as part of an asset allocation solution for private clients. YB

Best Private Bank in India
Standard Chartered Private Bank

India is seen very much as “a land of opportunity” by Standard Chartered Private Bank. According to Boston Consulting Group, India is set to become the seventh wealthiest nation by 2018, with a projected total private financial wealth of $5tn (€3.95tn), more than double that of 2013. This is the greatest jump among the projected top 15 wealthiest countries, and well ahead of other Bric nations.

According to Standard Chartered, its deep-rooted history and heritage in India provides the bank with “a unique advantage to tap into this rapid wealth creation”, leveraging networks to link clients across its core markets of Asia, Africa and the Middle East as they internationalise.

The bank believes its strength in commercial banking, through multi-generational relationships with business owners, can help serve private wealth needs by extending this relationship. “As these clients frequently require liquidity or funding to meet their business ambitions, their personal and business wealth are often intertwined,” says Michael Benz, global head of private banking clients at Standard Chartered Private Bank.

The acquisition of part of Morgan Stanley’s onshore private wealth management business in India in 2013 helped the bank boost its existing onshore business, adding scale and market share. Yet despite this supremacy in India, Standard Chartered has suffered in other markets due to a variety of factors including regulatory fines to the parent company and a large scale restructuring in Asia and the Middle East.

A recent Singapore-led reorganisation will place greater emphasis on private banking clients, according to the bank. This is aligned with a renewed focus on training and development of relationship managers.

With clients from developing markets increasingly looking to the safety of London to bank assets and invest in property, Standard Chartered is also stepping up its UK presence.

“We will continue to ramp up our product services and scale in the UK to continue to deliver on our aspiration of being a recognised leader in growing and protecting our clients’ wealth, and build the private bank for business owners across our footprint,” says Mr Benz. YB

Best Private Bank in Hong Kong
Citi Private Bank

The main source of competition in Hong Kong is mainly among the global institutions, rather than domestic players, according to the management of Citi Private Bank in the bustling Chinese province.

Rather than offer localised, Asian solutions, the blueprint at Citi involves using the bank’s scale to address the growing sophistication of clients and to manage the associated complexities that come along with that and the demands of an increasingly regulated environment. However, Citi does feel the need to keep ahead of some newer competitors closer to home. These come in the form of larger players from South Asia, including Singapore. Banks such as DBS, for instance, have become more active in Citi’s Hong Kong marketplace, where they are taking steps to increase their footprint locally as well as globally.

Citi has always taken a global approach to investing and prides itself in offering clients the ability to diversify outside Hong Kong, with a particular interest in overseas investments.  Citi’s clients there are particularly keen in looking at private equity opportunities that focus on distressed assets and real estate.

On average, Citi’s Hong Kong clients have at least 60 per cent exposure in Asia with much of that focused on real estate in Hong Kong as well as in countries like China, Taiwan, Singapore and Japan. There is still a certain comfort in “investing in your own back yard,” reveal Citi’s bankers. 

While the bedrock of Citi’s Hong Kong clientele lies in the wealth of thriving families established over one or two generations, some of the newer wealth being created in Hong Kong tends to be by those focused on opportunities in China in the areas of tech,
telecommunications and lifestyle. The bank recognises it must rise to the challenge of servicing these clients. In comparison, Citi’s bankers recognise that just up the road on the Chinese mainland, entrepreneurial wealth occupies and dominates a large part of the landscape.

While senior European and US bankers at Citi have been worried about recent protests in Hong Kong, their local counterparts are more sanguine, talking about “disruptions and inconveniences felt throughout the city,” rather than a longer-term risk factor threatening the safety of investments. YB

Best Private Bank in Singapore
Best Private Bank for Use of Technology
Judges’ Award for Industry Leader - Su Shan Tan
DBS Bank

DBS has provided one of the standout stories among award winners for 2014, having secured accolades for best institution in Singapore, its use of technology and for the leadership provided by high-profile, charismatic head of Consumer Banking & Wealth Management Su Shan Tan.

One of the main reasons why DBS has come into its own this year has been its acquisition of the Asian private banking franchise of Société Générale in Hong Kong and Singapore. The French bank had made a big point of hiring experienced bankers across the South East Asian region in recent years, yet struggled to make the business profitable. With its own regional infrastructure and branch network, this should not be a problem for DBS.

The bank’s overall CEO, Piyush Gupta, recently re-confirmed that boosting the wealth management franchise is now a key priority for DBS, with the completion of the recent acquisition boosting the bank’s competitive position in Asia.

Ms Tan, known for her no-nonsense yet personable and human approach to business issues, says the acquisition signifies a “coming of age” for the bank, allowing it to access products from beyond Asia through the deal with SocGen.

The majority of SGPB bankers are also joining DBS, including Olivier Gougeon, a long-term French insider who headed the Asian wealth operation for SocGen.

Although Ms Tan can be a divisive figure in the broader banking community, her role in the acquisition has won widespread praise, as has her absorption of customer service and technology innovation influences from other institutions across Asia, including banks, airlines and trading platforms. She has long maintained that the major competition for Asia’s private banks will in future come not from US financial players, but from the likes of Chinese internet-based e-commerce company Alibaba, with its range of payment services, search engines and cloud computing features.

Ms Tan was the “key instigator” in buying the French bank’s Asian operation, says Simeon Fowler, chief executive at Fowler Fox and one of Asia’s leading wealth management headhunters and talent scouts.

Not only has she hired several key staff to the management team, but she has also convinced the market to take DBS seriously since she joined in 2010: “It is fair to say that only since Su Shan joined the market has started to see DBS as a major player,” says Mr Fowler. YB

Best Private Bank in Malaysia
CIMB Private Banking

Despite strong competition from rival Maybank, CIMB continues to celebrate pole position in the Malaysian market, where it oversees $5.3bn (€4.2bn) of client assets, boosted by inflows of $620m in 2013. While growth has been consistent since inception in 2002, chief executive and founder Carolyn Leng, along with her management team, recognises the need to continue this momentum by focusing on key growth strategies.

These include enhancing partnerships in different parts of the group, emphasising trust and estate planning, introducing more targeted client segmentation, taking advantage of growing demand for Islamic private banking services in the South-East Asian region and product innovation including developing “upscale” credit solutions.

Lending, according to the bank, not only brings additional revenue through interest income, but also adds incremental managed assets to clients’ portfolios. The focus has very much been on “bundling” credit with existing facilities on the “product shelf.”

Overseas mortgages for UK properties – always popular among Malaysian clients, but gaining increasing traction – have been particularly well received, posting a higher take-up rate than local loans.

Over the past year, CIMB has worked on strengthening key account relationship management in three segments – entrepreneurs, “baby boomers” and “Generation Y” members and their families. This is done through a team-based approach, where junior private bankers are introduced to younger family members, in the knowledge that these successors on both sides will eventually
be key to the relationship between bank and client.

But the current buzzword in the corridors of CIMB head office in Kuala Lumpur is “regionalisation”, following the establishment of an offshore private banking platform in Singapore in early 2013.

The group can now leverage on its network in eight of 10 ASEAN nations, looking to compete with global as well as regional players in terms of service standards. “By benchmarking ourselves against our offshore peers, this ensures that we deliver the high standard of service level that our clients deserve,” says Mak Lye Mun, Singapore country head for CIMB Group and head of private banking.

The challenge for Malaysian private banks, he says, is to be able to keep up with the standard offered by international centres of Singapore and Hong Kong, in terms of both product offerings and regulatory infrastructure. YB

Best Private Bank in Indonesia
Bank Mandiri Wealth Management

Established in 2002, Mandiri Prioritas, part of Bank Mandiri, one of the biggest state-owned banks in Indonesia, is one of the fastest-growing priority banking services in the country, and by 2013 had more than IDR120tn (€7.8bn) assets under management in 2013, up 10 per cent from the previous year.

Mandiri has over 36,000 private clients, although this number has dropped somewhat from the 55,000 mark it had in 2011-2012, following changes to the way the bank segments its clients. The key driver for the growth in the bank’s wealth management business has been the economic success Indonesia is undergoing.

Most clients are businessmen who are enjoying the fruits of the country’s progress. Part of Mandiri Prioritas’ growth strategy is to increase product sales to these customers, and it offers more than 40 mutual fund products provided by seven investment managers.

The bank services its clients through a network of 54 Priority Outlet Offices spread across Indonesia and both total headcount and client-facing staff numbers saw significant rises last year. Communication is mostly done through traditional, non-digital channels, although the bank does reach customers through its website and via text and email alerts. ES

Best Private Bank in Korea
Shinhan Bank

The private banking market in Korea, as in other Asian regions, is undergoing rapid growth, and the Shinhan Financial Group is determined to take full advantage through its wealth management business – Shinhan PWM. Private client numbers rose 23 per cent in 2013 and assets under management were up by 23 per cent to KRW15.5tn (€11.5bn).

Shinhan was the first Korean bank to introduce a private banking business model based on a collaboration between banking and securities. It has 25 private banking centres within its retail branches, which were upgraded and renamed Private Wealth Management centres in the first half of this year.

“These PWM centres also offer expert asset management services to customers in other retail branches through linkups with nearby branches that handle day-to-day banking business,” says Jin-won Suh, CEO of Shinhan Bank. Ultra high net worth clients are also offered the services of two PWM Privilege centres. “Our customised consulting service team provides one-to-one solutions to individuals with more than KRW1bn in assets to meet their diverse and specific needs.”

In response to client demand, Shinhan claims to be the first bank in Korea to offer philanthropy services to its HNW customers. Recognising that even though wealthy individuals were keen to donate, many harbour doubts about the transparency of some charities, the bank established a partnership with Community Chest of Korea, the country’s largest community-impact charity.

“Apart from asset management we are also continually upgrading our ‘Total Life Care Service’ that includes a varied programme of cultural events, healthcare, golfing, and even a couple matching service for our clients,” adds Mr Suh.  ES

Best Private Bank in Taiwan
CTBC Bank

CTBC has worked to strengthen its position as a global Taiwanese financial institution and to broaden the services it offers, an effort that includes the acquisition, in cash, of Japan’s Tokyo Star Bank and domestic life insurance company, Manulife Taiwan.

The Tokyo Star transaction represents a landmark deal for CTBC Bank, which already covered 11 offshore markets including the US, Canada, Japan, India, Indonesia, the Philippines, Hong Kong, Singapore, Thailand, Vietnam, and China.

With 100 overseas outlets after acquiring Tokyo Star, CTBC Bank will have a comprehensive regional presence including northeast Asia, and be better able to serve customers’ increasing global needs.

This acquisition was also the first in Japan by a foreign institution and the largest M&A transaction in Japan by a Taiwanese public company. In addition, CTBC Bank had signed 19 memoranda of understanding with Japanese regional banks to reinforce its footprint in the second largest economy and banking market in Asia.

Cross-selling synergies should include the development of wealth management business in Japan, and trade finance and cross-border investments between CTBC’s Taiwan, Japan, mainland China and Southeast Asia customers.

After the global crisis, customers demanded more from wealth management, not only in terms of returns, but also risk management, transparent corporate governance, and professional adviser teams. In response the bank has strengthened its offering. As of October 2013, HNWI customers and managed assets have made year-on-year growth of 18.5 per cent and 17.6 per cent respectively. CJ

Best Private Bank in Thailand
Siam Commercial Bank PCL

Thailand spells opportunity for the private banking industry, being home to some 136,000 high net worth individuals, estimated to have a collective wealth of $647bn (€510bn) by 2015. Lalitphat Toranavikrai, head of private banking at SCB, says that, over the last five years, the bank has produced consistent growth and captured a greater share of the HNW market, despite a slowdown caused by the impact of political unrest on tourism and domestic consumption.

As part of Thailand’s oldest local bank, SCB Private Banking continues to build infrastructure and expand its footprint domestically, drawing on benefits of the integrated banking model by leveraging capabilities from constituent asset management, financial market division, economic intelligence centre, and corporate and investment banking services. The private bank’s assets under management have grown consistently and now stand at $20bn, more than 6 per cent of Thailand’s current $298bn in HNW wealth.

“SCB PB’s key success derives from the establishment of the investment intelligence centre dedicated to HNW clients launched in 2012,” adds Mr Toranavikrai. “With the AEC [the introduction of ASEAN Economic Community] coming, the new challenges for local private banks like SCB will be coping with international players, and we have spent years preparing, to ensure that once the market is ready, we will be in a leading position to serve clients.” CJ

Best Private Bank in Turkey
Akbank Private Banking

 This year, Akbank opened a prestigious branch at Zorlu Centre in the heart of Istanbul which includes a ‘Private Banking Corner’ and has taken $10m (€7.9m) AUM in six months. This is the tenth regional centre opened by the bank.

With the location of branches critical in reaching target clients, the bank has conducted a series of feasibility studies and decided to relocate three branches this year,  and two next year.

Akbank has launched a new business model with Turkish portfolio management companies for their deposit investments. Under new regulations, portfolio management companies in Turkey will be able to invest in deposit product, and place their deposits in local banks and this opportunity is being pursued aggressively.

A new business area is “Angel Investment”, which brought together the private banking arm and the commercial banking business unit. This year Akbank Private Banking organised conferences where these two parties could get to know each other and share their experiences. A web-based platform is also being designed for these parties to communicate online in the future.

“We offer highly competitive products and execute client transactions both offshore – through the accounts of Akbank Malta – and onshore through the accounts in Turkey,” says Didem Bagriacik, department head of Akbank Private Banking. Akbank Private Banking conducts its overseas operations and marketing facilities through its full branch in Malta and its Rep Office in Dubai DIFC.

“Akbank Private Banking also supports contemporary art across various platforms,” says Ms Bagriacik. “We have sponsored the international contemporary art fair ‘Contemporary Istanbul’ for seven years and provide customers with a range of collection visits, collection consultancy, and participation in auctions.” CJ

Best Private Bank in Saudi Arabia
SABB Private Banking

Riyadh-based SABB, an associated company of the HSBC Group, saw managed assets grow 10 per cent to SAR43.6bn (€9.2bn) and operating profit swell more than 120 per cent last year, thanks to new initiatives. Integration of private banking within the wealth management has given private banking clients access to a wider range of services and broader network of branches, making client referrals easier.

The enhancement of the ‘know your customer’ process has enabled the bank to prioritise its most valuable clients and serve them more effectively, while a team to monitor and reduce operational risk was also established.

Through HSBC Saudi Arabia, the bank provides local and international asset management services and brokerage, with the investment offering including money market, equities, fixed income, real estate, club deals and private equity.

Sharia-compliant investments represent a significant source of growth, with Islamic assets accounting for more than 70 per cent of the bank’s total AUM. Last year the institution launched Sharia-compliant structured deposits, sukuk and mutual funds.

SABB claims to be the only bank in the country offering sophisticated custody and consolidated reporting services.

The development of mobile banking has enabled customers to access accounts online and make transactions on-the-go, and the launch of an “innovative, international equity trading system” is also on the agenda.

“Competition from local and international banks is the major challenge we face,” acknowledges Arif Al Modaimigh, head of private banking at SABB. “We are investing in technology and training and development of our staff to continuously improve customer service.”

Looking forward, the institution aims at growing its client base in all the regions of the Kingdom of Saudi Arabia, explains Mr Al Modaimigh. SABB Private Banking needs to introduce value added services for its clients, particularly for those travelling abroad, who can still bank with the institution through the HSBC network, he says. “The expansion of international investment opportunities to clients, by offering a wide range of products and services and leveraging HSBC expertise, has to be our priority.” ET

Best Private Bank in the United Arab Emirates
National Bank of Abu Dhabi

Over the last three to four years, NBAD Global Private Banking has maintained its focus on becoming the reference private bank for the Arab world. Initiatives include onboarding top talent, promoting client centricity, expanding its international footprint by developing a hub and spoke approach with multi-booking centres and developing international investment competence. This global approach has prompted unification of private banking businesses, across four areas – UAE, Egypt, the UK and Switzerland – into one global team. 

The bank has kick-started an initiative aimed at improving the client experience, and designed to help align staff behaviour to customers’ expectations, named “Bring our hearts to work”. The initiative has introduced a “common approach when interacting with our customers” and aims to ensure all staff have relevant skillsets.

“We believe our customers should find it easy to bank with us, to the extent they would be happy to recommend NBAD to their personal network,” says Ashraf Mazahreh, managing director, private banking UAE. He claims the bank will ensure products are competitive, “aligned to needs of clients and delivered efficiently”. To achieve these goals, NBAD has apparently “promoted a robust fulfilment process that ensures seamless integration between front, middle and back office activities whilst regularly monitoring turnaround times and service standards”.

Complaint management is a fundamental component of customer service, as it allows NBAD to use client discussions to their advantage, adds Mr Mazahreh.

“Responding to complaints the right way and learning from our discussions offers the opportunity to further build relationships and to tailor services to individual client preferences. When things go wrong for a customer, it is everyone’s responsibility to act to satisfy the client,” he explains. “We have assigned a dedicated global relationship manager to every client, who will serve as a gateway to NBAD by employing a holistic approach, supporting the relationship end to end by selecting solutions from the NBAD group, including retail banking, investment banking, brokerage and asset management.” CJ

Best Private Bank in Bahrain
Best Private Bank in Kuwait
Ahli United bank

The Gulf Cooperation Council (GCC) is strategically placed to experience growth in the coming years led by the oil price, construction boom, new manufacturing facilities, increased education and universal healthcare, and cross border alliances fuelled by events such as the World Expo in 2020 in Dubai and the FIFA World Cup in Qatar.

These events should cement the GCC as a formal trade/tourism hub, the evidence of which is being seen in developments such as a Gulf-wide rail network. Growth in these economies and rise of corporatisation and global compliance standards in family run businesses have created demand for sophisticated wealth management capabilities.

Ahli United Bank (AUB) is well positioned to cater for sophisticated private banking clients within the region based on its local reach and global expertise. It has a presence in Bahrain, the UK, Kuwait, Egypt, Oman, Iraq and Libya and manages one of the bigger regional non-banking financial companies (NBFC) KMEFIC in Kuwait, and has indirect ownership into Saudi NBFC MEFIC, along with a 50:50 partnership in L&G Gulf to move into Saudi Arabia, UAE and Switzerland.

AUB has developed comprehensive group level “minimum operating standards” and policy guidelines with each policy studied against the regulatory requirements of the respective geography and the strictest requirements implemented. Use of third party consultancies has helped keep abreast of changing regulatory requirements. Keypoint Consultants helped with group-wide implementation of Fatca before June 2014.

“For 2015, we will continue to focus on delivering on our core commitment and capability, to be provider of choice to high net worth clients across our operating markets,” says Sawsan Abulhassan, deputy group CEO, Private Banking and Wealth Management.

In an increasingly interdependent world, the bank says it takes pride in meeting clients’ expectations. It aims to match local service with global expertise and investment opportunities.

“No effort will be spared in sourcing and introducing innovative products that match clients’ risk appetite while enhancing the overall investment proposition,” adds Mr Abulhassan. CJ

Best Private Bank in Qatar
Al Khalij Commercial Bank

Al Khalij Commercial Bank, which won the award for best private bank in Qatar, has continued its pattern of robust growth.

Its small team of private bankers based in Qatar draw their expertise from the bank’s commercial, corporate banking and treasury business in Qatar, the UAE and France to provide a platform for clients and produce the second best profit centre after corporate banking within the bank, with assets under management of more than $350m (€276m).

With a client base of established ultra high net worth individuals who are net promoters to friends and family members, single financing transactions now frequently exceed $50m.

Al Khaliji’s private banking business offers what the bank claims is “an unusual value proposition that has the feel of international private bankers but with a local focus,” and a “collaborative approach” that enables it to fulfil its clients personal as well as business requirements both locally and internationally.

“Al Khaliji continued to build its private wealth offering by identifying compelling investment opportunities in real estate and structured products,” says Arfat Qayyum, head of private banking. “Our structured finance capabilities assist clients with real estate acquisitions and project financing needs in different parts of the world.”

Next year, Al Khaliji aims to raise the bar further. “Private clients’ wealth is growing and their banking requirements are evolving rapidly,” says Mr Qayyum. CJ

Best Private Bank in Lebanon
Audi Private Bank

Based in Beirut but with pillars in Geneva and Riyadh, Audi Private Bank was the first bank in Lebanon to be exclusively dedicated to the private banking business. Comprised of a team of more than 90 people, the bank is pursuing an ambitious growth strategy, seeking to build a presence in countries where the Bank Audi group is located – Turkey, Jordan, Egypt, Saudi Arabia, Qatar, the UAE and in France. It has also started covering the North American market, hiring five new relationship managers to target the region’s wealth.

“In addition, the Africa and the Latin American teams are developing new relationships with high net worth individuals in countries such as Brazil, Venezuela, and Senegal,” says Toufic Aouad, general manager of Audi Private Bank.

Targeting clients with at least $500,000 (€395,000) in investable assets, Audi Private Bank is attempting to reposition wealthy individuals out of cash and into different asset classes. Those unwilling to do so are directed towards retail branches, while those retail clients looking to invest in financial markets are sent in the other direction.

“Regional political tensions have weighed on investors’ decisions, pushing them towards more caution and portfolio diversification,” admits Mr Aouad, although he claims belonging to a universal bank does “inspire security and credibility” in its customers.

As well as in-house products, the bank follows an open architecture approach and is keen to build relationships to further its growth. An alliance with multi-manager Russell Investment Group gives clients access to international markets while Audi is looking to develop its private banking services in Turkey in collaboration with OdeaBank. ES