Global Private Banking Awards 2016: Winners’ Profiles – National Winners (Asia)

Best Private Bank in China
China Merchants Bank

China Merchants Bank (CMB) was one of the first commercial banks in China to move into the private banking space.

The bank launched its first private banking dedicated branch in Shenzhen in 2007. Since then, it has opened 24 private banking centres in China’s main cities and a number of offices in other locations across the country. It serves a wide range of customers, including businesses, families, individuals and investors, with assets of more than RMB 10m ($1.5m).

Over the last eight years, CMB has been focused on establishing itself as a leading player in the domestic private banking sector by developing and expanding its product offering and asset management capabilities. These include market research, investment strategies, product selection, and performance tracking and surveillance.

CMB launched its family office business in 2012, offering services such as family trusts, tax planning, corporate finance and offshore financial solutions. In 2013, the bank added a wealth inheritance service, to provide HNW families with wealth protection solutions and inheritance plans. 

More recently, CMB launched its discretionary accounts service, offering tailor-made investment solutions that take into account clients’ risk appetite, expected return, liquidity and preferred field of investment. 

“We will keep upgrading and expanding our open architecture platform, and consolidating our absolute advantage in serving high-end clients by promoting our family office services,” says general manager Wang Jing. The bank also plans to continue developing discretionary accounts and cross-border financial services. PG

Best Private Bank in India
Kotak Wealth Management

In April 2015, ING Vysya Bank merged with Kotak Mahindra Bank. The combined entity has a strong presence in India, with some 1300 branches across the country.

Private banking services are offered through Kotak Wealth Management, providing a vast range of financial advice to some of India’s wealthiest families. The firm has recently changed its business model, moving away from a transaction-oriented approach, to an advisory approach. 

According to Jaideep Hansraj, head of wealth management and priority banking, the advisory approach has helped remove any doubt in the client’s mind about potential conflicts of interest, thus “attracting new clients, and increasing our wallet share from our existing client base”. The introduction of a fixed advisory fee has allowed Kotak to maintain revenues in an environment of increased allocation to lower margin asset classes.

 Kotak’s offerings are based on the pillars of asset allocation, open architecture and alignment of interests with the client. “With our open architecture approach, we are adding best performing industry products and fund managers to our product suite, to widen it so as to offer an unique product proposition to each client, based on their individual needs and preferences,” he says.

The bank has recently upgraded management information and portfolio reporting systems to enable clients to view their transactions online, and get consolidated reports at an individual and family level. Improving client facing technology, such as mobile apps and relationship management systems, will remain a main focus for the bank in the near future. PG

Best Private Bank in Australia
Westpac Private Bank

Westpac Private Bank is part of BT Financial Group – the wealth management arm of the Westpac Group, Australia’s oldest company and bank, turning 200 next year. 

The private bank, which manages $37.7bn, claims it has achieved growth through the execution of its formula: “growth = frequency of client contact x value of the interaction”. 

In 2015, net new money grew by AUD2.2bn ($1.7bn) and the number of private clients increased 7 per cent, passing the 10,000 mark. 

The bank, which has won this accolade for the second year in a row, has further developed its direct wealth investment capabilities for self-directed clients, who represent more than two thirds of its client base. Last year it launched a number of innovative multi-currency and multi-asset investment solutions, underpinned by a thematic investment approach. 

“A key growth driver for private banking is our ability to provide clients with access to high quality global wholesale and institutional solutions, which fit a wide range of risk-reward profiles, backed by a thematic-led, high conviction investment process,” explains Jane Watts, general manager of BT Private Wealth. “This allows clients to invest within thematic areas that resonate with them.”

Westpac has also continued to invest in technology and build out digital capabilities to enhance client experience. 

For example, HNW individuals can now access their holdings, transactions and balances on a responsive mobile portal. Also, last year it was “the first bank in the world” to deliver finger print login ‘touch ID’ banking, allowing clients to take a photo of their card to activate it.

The Asian wealthy have been and will continue to be the biggest growth client segment for the Australian bank. “By building out strong relationships via our multi-lingual Asian private bankers, we are earning trust in this critical growth market,” says Ms Watts.

The Australian institution has increased support to ultra-high net worth clients, and has lowered the ratio of clients per relationship manager to 50:1. 

“The UHNW and family office space is where there are the largest relationships by revenue and thus present opportunities on both sides of the balance sheet,” says Ms Watts. “Today’s HNWI are tomorrow’s UHNWI; there needs to be a simultaneous development of both segments.” ET

Best Private Bank in New Zealand
BNZ Private Bank

Strategic initiatives which freed up bankers’ time and released capacity through the simplification of back office processes have helped to drive growth at BNZ Private Bank. 

In 2015, bankers wrote almost twice as many financial plans as the previous year, a large portion of which was then converted into new business, explains Donna Nicolof, head of BNZ Wealth & Private Bank. 

As a result, client assets rose 5 per cent to NZD5.4bn ($3.9bn) and net new money almost doubled to NZD600m.

What also paid off was a strategy aimed at encouraging referrals to the private bank within the wider BNZ Partners network. This incorporates the private bank and the institutional, commercial, corporate, property and agribusiness divisions. During the year, there were more than 2000 referrals to private bankers from staff at BNZ Partners.

BNZ also refined its distribution model and invested in people, expanding in key growth areas such as Auckland, recognising demographic trends. Net migration to New Zealand is now at a record high.

Last year, BNZ’s Retail Wealth business unit, targeting individuals with investable assets of between $100k and $1m, was fully integrated into BNZ Private Bank. This move is expected to create a pipeline of future clients for the private bank.

Late in 2015, BNZ Private Bank created a dedicated team to serve family offices, recognising the growth potential of this client segment. “We’re seeing a growing number of business owners in New Zealand selling either to private equity or overseas interests,” says Ms Nicolof. “These people have created wealth by establishing and leading successful businesses, and are now looking for advice on how to optimise their financial situation and leave a positive legacy, both for their families and the community.”

New Zealand is attracting more and more ultra-high net worth individuals from overseas who want to make the country home for themselves, their families and their businesses, she explains.

“Formalising our offer also gives us a distinct point of difference from our competitors, and a first-to-market opportunity.” ET

Best Private Bank in Hong Kong
HSBC Private Bank

Its deep-rooted history and connection to Asia helps differentiate HSBC from competitors, as the bank was founded in Hong Kong more than 150 years ago, to finance growing trade between China and Europe, and was the first locally owned and locally managed bank.

“HSBC’s focus as a group continues to be Asia-Pacific, particularly to support the increasing wealth and demand for private banking services in the Pearl River Delta,” says Bernard Rennell, regional head of global private banking, Asia-Pacific at HSBC Private Bank. 

This region of mainland China, once a hub for low-value-add manufacturing, is rapidly becoming a centre for high-tech manufacturing and services.

However, growing wealth is not just a product of economic growth, but also a result of an increasing number of entrepreneurs, looking for a banking partner that can support their corporate, investment and private banking needs, states Mr Rennell.

“Many of our clients are entrepreneurs who founded their own businesses and accumulated personal wealth over time, with some also having realised significant wealth from recent major liquidity events, such as IPOs or the sale of their existing businesses.”

As a result, the bank’s growth strategy is geared towards serving existing clients “more effectively”, across their full range of needs. The bank can support their banking needs from Hong Kong, servicing more than 70 countries and territories around the world. And the private bank’s 70-year old Private Wealth Solutions business provides wealth structuring, succession planning, family governance and philanthropy advisory services. Clients also benefit from the “world’s largest trust and fiduciary services businesses”.

“Rather than working with multiple banks across different countries for their business, entrepreneurs want to simplify their banking relationship,” says Mr Rennell. “They want a banking partner that can support all their corporate, investment and private banking needs.”

The bank has rolled out an enhanced investment service in recent years, where the core analysis of each client’s asset and liability management requirements is matched with a core and satellite strategic asset allocation. This would allow a more holistic view of clients’ accounts, meet their investment objectives and reduce portfolio risk. 

The bank adopts an open architecture approach, also working in close collaboration with HSBC Asset Management, and its long-running and large multi-manager programme. The private bank’s HSBC Alternatives Investment Group provides hedge funds, private equity and real estate solutions. 

Client assets managed globally by HSBC Private Bank – whose reputation last year was dented by the Swiss bank tax evasion scandal dating back to the years up to 2007 – decreased by $16bn in 2015 to $349bn. 

In Asia, however, AuM remained flat at $112bn, and more than 50 per cent of its global profit was generated in Hong Kong. ET

Best Private Bank in Singapore
Best Private Bank for Innovation
DBS Bank

Led by charismatic private banking CEO Su Shan Tan, backed up by operations and technology czar Olivier Crespin, Singapore’s DBS Bank has cemented its place as one of the leading innovators in the fast moving Asian regional market.

Having recently absorbed the Asian SocGen franchise, DBS figures show that the bank has now been delivering consistent double digit private banking growth since 2011, fuelled by both new clients and the ultra high net worth client segment.

Crucial to this vision is the bank’s digitalisation programme, which is at the core of the DBS growth strategy. This has included upgrading of the iWealth online platform available in Singapore, Hong Kong, Taiwan, China, Indonesia and India, to improve clients’ experience, but also to engage them more online and to increase the amount of transactions and interaction they are having with the bank.

The bank also hopes to increase cost savings by spreading expenses across a much wider pool of clients and enhancing its penetration of straight through processing (STP).

A special project of ‘RM Mobility’ involves “empowering” the bank’s front-line sales force, allowing them to become truly mobile across the region and less confined to their offices. This involves connecting with clients via an app through the portfolio management process as well as the initial prospecting and onboarding stages, using Human-Centred Design (HCD) principles, with feedback from bank customers and staff. YB

Best Private Bank in Malaysia
Best Private Bank for Islamic Services
Maybank

Maybank is present in all 10 Asean countries and provides wealth management services to its affluent and high net worth clientele through its Premier and Private Wealth segments. 

The bank has dedicated significant resources to further develop its HNW business, improving their value proposition, service standards and geographical reach. As a result, the business grew steadily last year.

“There are several pillars that contributed to our growth in 2015. However, it all centres around placing our clients’ needs and interests first,” says Alvin Lee, head of group wealth management. “Private banking is not just about having the best-in-class products, but importantly, building a long-standing relationship of trust and bringing value to our clients.”

In 2015, the bank launched discretionary portfolio management in Singapore and Lombard Financing in Malaysia. “In the current low interest rate environment, access to financing and leverage options can potentially create better investment opportunities and returns across clients’ range of risk appetites. Lombard Financing is such an option,” he says.

Its geographical footprint was expanded with two new Private Wealth centres in Malaysia, and a booking centre in Hong Kong to connect investment and business interests of HNWIs in Greater China, to opportunities the bank’s key markets. The group also opened an office in London to service its client’s UK property financing needs. 

Testament to its commitment to its local clientele, Maybank has dedicated significant resources to developing its Shariah-compliant offerings. Last year, the group launched its SCOE (Sharia Centre of Excellence) and SCOE ‘Virtual Centre’ in February 2015, as they strive to become a global reference point on Shariah knowledge and best practices. 

“Of course, our pursuit to strengthen the business does not stop here. As we navigate through these challenging market conditions, we continue to build infrastructure and ensure that our service and delivery are consistent with clients’ evolving needs,” Mr Lee adds. PG

Best Private Bank in Indonesia
Bank Mandiri Wealth Management

Mandiri Wealth Management is well-known in Indonesia for its brand name, Mandiri Prioritas. Established in 2002, Mandiri Prioritas is now one of the fastest-growing priority banking services in the country, with more than 43,000 customers. In addition to banking services, the bank offers a wide range of investment products to its clients. Over the years, it has developed partnerships with nine leading investment managers with more than 40 mutual fund products on offer. 

Recently, Mandiri Prioritas expanded its offering by developing a private banking service, Mandiri Private, aimed at customers with more than IDR20bn ($1.5m) placed in the bank. The bank is now introducing new branding for its private banking business, to differentiate it from other business segments when communicating with existing and prospective clients.

Formal, non-digital communications are still an important part of the way the bank stays in contact with its clients. However, and as part of their client relationship strategy, there is an increasing focus on digital communications via their website, SMS and email. In the near future, market updates will also be offered through an online portal specifically designed for private banking customers.

Mandiri also plans to equip all its private banking relationship managers with a tablet application, enabling them to show a specific portfolio simulation to customers face-to-face or via other channels. PG

Best Private Bank in Korea
Shinhan PWM

As the number of HNWIs in South Korea continues to rise – reaching almost 193,000 according to Capgemini – they are having to contend with historically low interest rates, the economic slowdown in China and worries over the state of the global economy. This combination of a rising client base and a volatile investment climate should prove to be an ideal environment for the continued evolution of the wealth management industry in the country.

The Korean wealth management scene is dominated by domestic firms. “Foreign banks did enter the Korean wealth management arena, but due to their limited understanding of the market, they were unable to solidify their position,” says Samuel Do, manager of the wealth management department at Shinhan, which has won this award for the third year running.

Competition among the local firms is hotting up though, with many local institutions starting to offer wealth management services as an important revenue pipeline. Shinhan continues to expand its offering, opening 16 PWM lounges in 2015. Situated across the country, these provide products and asset management services to its affluent customers and their number is expected to rise to more than 100 by the end of 2016.

The bank’s number of private clients rose by 16.7 per cent in 2015 to reach almost 8500, with assets under management up by nearly 20 per cent.

Korean HNWIs tend to invest heavily in real estate, though there are signs that they are starting to expand their investment horizons, which could become a key differentiator between wealth managers, explains Mr Do. “As interest rates remain at record lows, our clients’ needs will grow and competition among banking institutions that offer wealth management will become fiercer.”

The bank is also starting to target overseas clients, with its global specialised PWM channels in Seoul and Jeju acting as beachheads for overseas HNWIs. ES

Best Private Bank in Taiwan
CTBC Bank

CTBC has seen tremendous growth in the number of private banking clients in the past couple of years. This partly reflects a growth in the market itself. “The number of HNWIs is growing, which means the private clients market base is flourishing and opportunities keep growing,” says the bank. However, CTBC also holds the largest share of this market – capitalising on a mixture of tech knowhow and face-to-face customer service. An example of the former is its new digital model that leverages big data and analysis of individual customers to improve the customer experience. An example of the latter is its grand wine-tasting event of December 2015 – the bank remembers the importance of tangible interaction between client and relationship manager at a personal, social level. 

CTBC’s Family Membership scheme, launched in 2013, has proved popular, attracting more than 7000 clients, with a slightly higher average AuM than the overall average. “CTBC launched family membership because of Taiwan’s ageing issue,” says the bank, which notes that about 30 per cent of its high net worth clients are more than 60 years old. 

“Clients always talk about how and when to transfer wealth to the next generation. However, customer surveys show that HNWIs cannot handle succession well due to the complexities of tax and fairness in allocation, though they are aware of these issues,” the bank says. 

CTBC has also done a good job in managing the risks of its customers – who “pay more attention to risk control than asset appreciation”, according to the bank. In 2015, prompted by the Greek debt crisis, it launched a market risk pre-alert model, which leveraged big data to analyze the customers likely to be impacted most critically. Consequently, almost 2000 first priority HNWIs were selected and given asset reallocation advice. The vast bulk of these customers changed their asset allocations as a result. DT

Best Private Bank in Thailand
Kasikornbank PCL 

Kasikornbank Private Banking, the biggest wealth manager in Thailand, with 40 per cent penetration of high net worth customers and an AuM of 760bn baht ($22 bn), is acutely aware of the challenges of private banking in what Jirawat Supornpaibul, the CEO of the Thai banking group’s private banking division, refers to as a “pre-mature market”. 

“We believe that the key challenge of customers in Thailand is the background of investment knowledge,” he says. “The majority of our clients are not familiar with financial investment, and especially with sophisticated investment products,” he explains. 

“In order to gain trust, therefore, we should start the relationship with knowledge sharing and market education.” 

As well as advice from private bankers, this includes financial forums and a digital channel called Line. Mr Supornpaibul’s justification: “Understanding leads to investment. Investment experiences make people familiar and more willing to invest in more sophisticated financial products.”

Kasikornbank has also benefited greatly, both in terms of brand and in concrete improvements, from its partnership with the Swiss bank Lombard Odier. In line with the 2014 agreement, Lombard Odier manages global investment funds on behalf of Kasikornbank’s private clients in return for a management fee. Moreover, Kasikornbank refers high net worth private clients to Lombard Odier, where appropriate, while the Swiss firm provides advisory training for the Thai bank’s relationship managers and financial advisers.

“We cannot deny the fact that the leverage from the partnership with Lombard Odier has enhanced our capabilities in many aspects,” says Mr Supornpaibul. “It could be said that the primary benefit is the knowledge sharing. Since we started developing the partnership, Lombard Odier has transferred to us its long accumulated experience in global private banking services.” 

However, he also thinks the expansion of Kasikornbank’s product range has been extremely helpful: for example, Lombard Odier manages the K Strategic Global Multi-Asset Fund, the first risk-based asset allocation fund to be launched in the country. DT