Wealth Management in Asia 2016

2016
ISSUE: AUGUST
Wealth
Management
in Asia 2016
hubbis.com
Foreword
On behalf of BNP Paribas Wealth Management, I am
delighted to partner again with Hubbis on this flagship
publication the 6th edition of an annual overview and
outlook for the private banking and wealth management
industry in Asia.
The last 12 months have been particu-
In many cases, this involves redesigning
larly tough for all industry players. The
the core service model and digitising
various challenges that organisations
parts of the value chain.
face are nothing new, but the pressures

have been mounting to the point where
A lot of conversations at the moment
chief executives are reconsidering their
among industry leaders revolve around
business models, along with the strate-
efficiency and enabling front-line staff
gic choices they need to make, to remain
to be more productive to generate
relevant in Asia.
revenue opportunities rather than

spending their time on more administra-
In short, this means re-focusing on the
tive tasks.
areas within which they believe they

can provide real added value to their
Meanwhile, the desire to develop more
clients.
needs-based solutions for clients in Asia

is a process which will take time but
For some players, this has meant exiting
will finally drive the change in thinking
certain markets or locations, or the in-
needed to lead to a new business model
dustry entirely.
for wealth management in Asia.
For those with the conviction to con-
The content in this publication covers
tinue to compete in this space, they need
these issues and more. I hope you enjoy
to determine how to build a sustainable
reading and are able to benefit from
platform for the future.
these insights.
MIGNONNE CHENG
CHAIRMAN & CHIEF EXECUTIVE OFFICER, ASIA PACIFIC
BNP PARIBAS WEALTH MANAGEMENT
CONTENTS
02
92
136
176
194
204
Section 1
Business strategy
Section 2
Local markets
Section 3
Product & advisory offerings
Section 4
Family wealth
Section 5
Insurance in wealth management
Section 6
Digital wealth
Feature Articles
02
A NEW LOOK-AND-FEEL FOR ASIAN WEALTH MANAGEMENT
In a more challenging year for wealth management and private banking

than the industry has seen for a long time, defining and articulating a
clear value proposition is essential to meet todays client expectations
and behaviour.
36
WILL PRIVATE BANKING IN ASIA THRIVE OR WITHER?
As consolidation gathers pace and polarisiation within this segment

continues in the face of rising costs and thin margins, how should private
banks adapt to thrive?
WEALTH MANAGEMENT IN ASIA 2016
CONTENTS
136
RE-IGNITING THE REVENUE ENGINE
Wealth managers have found it tougher than ever to make money

in the first half of 2016. But beyond just proposing new investment
strategies for clients, they need to drive needs-based conversations to
adapt and provide a more relevant offering.
166
CHANGING THE RULES OF THE ADVISORY GAME
Better advice in Asia can only come with the willingness and ability
of wealth managers to position products as solutions, drive simplicity
and transparency, and enhance client service. A focus on long-term
portfolio value must replace the (continued) tendency towards shortterm conversations.
186
A PRESSING NEED TO ENHANCE THE DISTRIBUTION MODEL
Having discussions which are more focused, relevant to clients needs

and actionable, will create a more realistic chance of bringing the
concept of advice to life in Asia. This calls for asset managers to hone
in on the ways they engage, support and communicate with fund
gatekeepers across wealth management.
Expert Insights
16
THE EMERGENCE OF ASIAN MULTI-FAMILY OFFICES
Philippe Legrand of London and Capital Asia

24
PROVING THE VALUE OF PROFESSIONALISM
Nick Pollard of CFA Institute

46
WHY PRIVATE BANKS WILL LIVE OR DIE ON INNOVATION
Mignonne Cheng of BNP Paribas Wealth Management

48
MAYBANK KEEPS FOCUS ON SUSTAINABILITY IN PRIVATE WEALTH
Alvin Lee of Maybank

72
A NEED TO BE NICHE
Brian Shegar of Emirates NBD

92
HOW BEA IS EYEING CHINA FOR WEALTH MANAGEMENT GROWTH
Grace Chow of Bank of East Asia
ii
CONTENTS
100
THE COMPONENTS OF A SUCCESSFUL WEALTH OFFERING IN INDIA
Karan Bhagat of IIFL Private Wealth Management

106
KASIKORNBANK SHOWS WAY TO SERVICE HNW THAIS
Jirawat Supornpaibul of Kasikornbank

110
BRINGING A BROADER AND DEEPER OFFERING TO THAILAND
Don Charnsupharindr of Citi

114
THAI INSURERS JUMP ON DIVERSIFICATION BANDWAGON
Kris Chantanotoke of Thai Life Insurance

124
CHANGING THE PHILIPPINES INVESTMENT MIND-SET
Robert B Ramos of Union Bank of the Philippines

126
CATERING TO A MORE GLOBAL OUTLOOK IN THE PHILIPPINES
Nanjo Berba of Philam Asset Management

134
CAN MALAYSIA CREATE A REAL CULTURE OF ADVICE?
Robert Foo of MyFP Services

146
PHYSICAL GOLD: ARE YOU READY?
Seamus Donoghue of Allocated Bullion Solutions

148
GIVING CLIENTS THE PRODUCT PROPOSITION THEY WANT
Lavanya Chari of Deutsche Bank Wealth Management

152
HOW CITI IS ENHANCING ITS ADVISORY OFFERING
Paul Hodes of Citi

157
GETTING ONTO A BANKS FUNDS DISTRIBUTION PLATFORM
Stewart Aldcroft of Citi

158
MAKING THE SWITCH FROM PRODUCTS TO PORTFOLIOS
Damien Mooney of BlackRock

160
WHY BANK DISTRIBUTORS MUST RE-TUNE PRODUCT PLATFORMS
June Wong of State Street Global Advisors

162
DRIVING A NEEDS-BASED CONVERSATION
Shikha Gaur of Aon Hewitt
iii
CONTENTS
164
NO ROOM FOR COMPLACENCY IN DISTRIBUTION
Alison Brown of HSBC Global Asset Management

170
FACILITATING A MORE CONDUCIVE INVESTMENT LANDSCAPE
Kevin Talbot of Aviva Investors

172
THE CHANGING LANDSCAPE OF OVERSEAS PROPERTY: CHINA FACTOR
Piers Brunner of Knight Frank

176
FACING UP TO THE REGULATORY REALITY OF TRANSPARENCY
Andri Manatschal of PwC

178
PLUGGING A GAP FOR LONG-TERM STRUCTURING ADVICE
Nigel Rivers of Capital Solutions

184
GREATER TRANSPARENCY RAISES PRIVACY AND ADVICE RED FLAGS
Stephanie Jarrett of Baker & McKenzie

193
KNOCKING ON ASIAS ONSHORE OPPORTUNITY
Jonathan Hubbard of UBS Wealth Management

196
BROADENING THE INSURANCE FOCUS ON HONG KONGS WEALTHY
Thomas Young of Generali

202
EYEING HEALTHY PROFITS FROM A MORE MOBILE CHINA
Rainbow Pan of Bupa Global

207
A PROCESS TO DIGITALISATION
Peter McMillan of Thomson Reuters

208
WHY BANKS MUST RELY ON FINTECHS
Ralph Mogicato of Angel investor and entrepreneur

214
WHAT IF AN UBER WEALTH WAS BORN?
Raj Ganesarajah of Intellect Design Arena
iv
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CONTENTS
Profiles
12
EFG SHOWS CLEAR CONVICTION FOR SCALE
Joachim Straehle & Albert Chiu of EFG International

18
FOCUSING ON WHAT MATTERS TO CLIENTS
Nigel Preston of St. Jamess Place Wealth Management

28
THE ROLE FOR BOUTIQUES IN ASIAS NEW WEALTH LANDSCAPE
Febby Avianto of Falcon Private Bank

52
HOW HSBC IS PURSUING ITS DESIRED PRIVATE BANKING MODEL
Sandeep Sharma of HSBC Private Bank

60
FOCUSING ON WHAT YOURE GOOD AT
Evrard Bordier of Bordier & Cie

64
BANK VONTOBEL EYES ASIA WITH OFFERING OF GLOBAL ACCESS
Georg Schubiger of Bank Vontobel

76
STEADY GROWTH WITH AN EYE TO THE MILLENNIALS
Vincent Chui of Morgan Stanley

80
INVESTEC STRIVES TO SET NEW ADVISORY TONE IN HONG KONG
Catherine Kirchmann of Investec Wealth & Investment

98
DRIVING AN ALL-ROUND INDIAN PROPOSITION FOR HIGH-END CLIENTS
Anshu Kapoor of Edelweiss Global Wealth Management

116
KASIKORN ASSET MANAGEMENTS VISION FOR THAI DISTRIBUTION
Benjarong Techamuanvivit of Kasikorn Asset Management

118
A NOVEL APPROACH TO WEALTH ADVICE IN THAILAND
Paul Gambles of MBMG Group

132
A WEALTH OF OPPORTUNITY FOR RHB BANK
U Chen Hock of RHB Bank

174
HOW CREDIT SUISSE IS LEADING AN ASIAN ASSET MANAGEMENT CHARGE
Michael Levin of Credit Suisse

182
SHEDDING LIGHT ON THE ANATOMY OF A FAMILY BUSINESS
Hans Diederen & Angelo Venardos of Heritage Trust Group
CONTENTS
190
A GENERATIONAL MIND-SET TO SERVICING FAMILY WEALTH
Shanker Iyer, Sunil Iyer & Sanjay Iyer of Iyer Practice Advisers
194
SUN LIFE EMBARKS ON PATH TO TAP THE WEALTH PIPELINE
Jason Dehni of Sun Life Hong Kong

198
TOKIO MARINE CARVES LIFE INSURANCE NICHE IN SINGAPORE
James Tan of Tokio Marine Life Insurance Singapore Ltd.
Event Highlights
22
COMPLIANCE IN ASIAN WEALTH MANAGEMENT FORUM 2016
Gearing up for greater compliance scrutiny

32
ASIAN WEALTH MANAGEMENT FORUM 2016 - HONG KONG
Redefining business and advisory propositions

56
INDEPENDENT WEALTH MANAGEMENT FORUM 2016
Independent firms can grab more AUM, but growth hurdles remain
68
ASIAN WEALTH MANAGEMENT FORUM 2016 - SINGAPORE
Mapping out the future for Asian wealth management

84
WEALTH THINK 2016 - HONG KONG
Rethinking business models in Asian wealth management

94
MIDDLE EAST WEALTH MANAGEMENT FORUM 2016
Enhancing capability, capacity and pipeline in the Middle East

102
THAILAND WEALTH MANAGEMENT FORUM 2016
Thai potential heralds new dawn for wealth management offerings

120
PHILIPPINES WEALTH MANAGEMENT FORUM 2016
A need for more investment and conviction in the Philippines

128
MALAYSIAN WEALTH MANAGEMENT FORUM 2016
Finding the way forward in Malaysian wealth management
vi
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CONTENTS
154
INVESTMENT SOLUTIONS FORUM 2016 - SINGAPORE
Finding investment solutions for challenging markets

180
INDIAN FAMILY WEALTH FORUM 2016
Managing Indian family wealth
Co-published Article
88
REGULATORY CHANGE MANAGEMENT FOR INVESTMENT SUITABILITY

AND BEYOND
Prasanna Venkatesan of Synpulse
Directory
218
PEOPLE AND FIRMS WHO SUPPORTED THIS PUBLICATION
We very much appreciate the participation and contribution of key

individuals and organisations in the Asian wealth management
community to the content in this publication.
Published by Hubbis. Printed in August 2016 in Hong Kong. Hubbis (HK) Limited 2016
All rights reserved. No portion of this book may
be reproduced, duplicated or copied by any
means without the prior written consent of the
publisher. No legal responsibility can be accepted
by the author or publisher for the content which
appears in this publication.
vii
Michael Stanhope
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Hubbis
T (852) 2563 8766
E michael.stanhope@hubbis.com
W www.hubbis.com
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USD20 bn
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With branches and
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Page 6
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Page 36
Page 92
9,000
75%
47%
KBanks private banking business
75% of the performance
Chinas HNW growth has
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of average advisory portfolios
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FEATURE ARTICLE
A new look-and-feel for Asian

wealth management
In a more challenging year for wealth management and private banking than the industry
has seen for a long time, defining and articulating a clear value proposition is essential to
meet todays client expectations and behaviour.
A July 2016 report by Oliver Wyman

says that to sustain profitability, the
wealth management industry needs to
redesign the core HNW service model
and digitise parts of the value chain.
More specifically, it says organisations
should explore new sources of value
Wealth managers with

less than USD20 billion in
AUM may find it hard to
sustain operations
in Asia.
creation, such as platforms that enable

investors to access opportunities such
as growth-stage financing or direct real
estate investments. This is in response
MARC VAN DE WALLE

Bank of Singapore
to the reports findings that AUM

growth is expected to slow from 7%
per annum over the past five years to
5% per annum until 2020.
recent years are changing, and firms will
on client acquisitions and managing
The messages are consistent with many
need to take action on costs and devel-
attrition risks, in particular with respect
other well-respected annual studies
oping new ways of engaging with clients
to inter-generational wealth transfers.
does on the industry, including those
to maintain revenues.
by Capgemini and The Boston Consulting Group, for example.
I agree that 2016 is, and will continue

In turn, adds the Oliver Wyman report,
to be, challenging for the wealth manage-
entitled: Wealth Management: Running
ment industry, not just in Asia but glob-
The conclusions are broadly based on
faster to stand still, and co-authored
ally, says Fredrik Lager, general manager
the fact that the forces which drove
with Deutsche Bank Research, business
at SEB Private Banking in Singapore.
performance in wealth management in
leaders will need to sharpen their focus
What we see in particular is that the
FEATURE ARTICLE
is tackling rising cost despite margin
It would certainly ensure

enhanced professionalism
over time if we could
stabilise management
turnover and as a result of
that, RM turnover.
LONNIE HOWELL
UCAP Asset Management
compression, he adds.
According to Lager, it may take time
before there is a return to a more stable
financial environment. In the meantime, banks will suffer at a top-line level.
SHIFTING LANDSCAPE
There is little doubt about the scale of
the opportunity bearing in mind the
regions wealth demographics.
Capgeminis World Wealth Report 2016,
for instance, said that in 2015, HNW
wealth continued to hit new record
activity income has dropped quite con-
restrictive approach towards invest-
highs, aided especially by Asia Pacific
siderably over the last six months.
ments, says Lager, referring to the
overtaking North America as the num-
upcoming US Presidential election,
ber-one wealth market. And Japan and
MULTI-PRONGED CHALLENGES
Brexit, oil prices, Europes migration
China emerged as engines of global
Market volatility and economic uncer-
problem, broader geo-political unrest
growth, registering double-digit increas-
tainty are adding to the pressures of a
and China trying to cope with its loss
es in both the population of HNW indi-
wealth management industry already
in industrial momentum.
viduals and UHNW wealth growth. To-
challenged by operational efficiency,
gether, the two countries drove nearly
margin pressures and regulatory re-
And the low-yield environment on the
quirements. Most clients seem to be
macro front is a problem both for
waiting on the side-lines, having
clients and banks. Return on all invest-
And if past growth rates hold, Cap-
adopted a wait-and-see approach
ments is lower, hence spreads have to
gemini predicts that Asia Pacific is likely
towards investments.
be thinner for clients to have a decent
to continue to be a dominant force over
return, explains Marc Van de Walle,
the next decade, representing two-fifths
There are a lot of things going on glob-
global head of products at Bank of
of the worlds HNW wealth, more than
ally which, I believe, warrants this rather
Singapore. In a nutshell, the challenge
that of Europe, Latin America and the
60% of global HNW population growth.
Middle East and Africa combined.

Yet while wealth is growing, revenue is
Coupled with the growing

complexity of doing business in
multiple jurisdictions, private
banks will have to modify and
fine-tune their business models
and strategies.
challenged and costs keep rising.

In such an environment, some practitioners say that only banks with critical
mass can offer the breadth of global
products needed to thrive.
In line with this, along with a maturing
and increasingly-competitive private
JASON LAI
Thirdrock Group
banking industry in Asia, consolidation

seems inevitable. The increasing cost
of doing business and squeezed margins
could force out some players whose
an individual approach
is the only answer.
zurich singapore
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global
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swiss
FEATURE ARTICLE
ensure all clients are fully transparent
The Panama Papers had more of

an impact on the public debate.
How much privacy do you allow
for those vehicles and how do
you ensure proper oversight?
both in relation to tax and plausibility of wealth.

The times when clients could hide
behind banking secrecy are dead and
will never return, says Lager. This will
become even more evident when CRS
kicks in fully in 2017 and 2018.
STEFAN KUHN
Credit Suisse Private Banking
The Panama Papers incident also

caused a lot of work to work on inquires
and in-house checks. Yet this had more
of an impact on the public debate, says
Stefan Kuhn, head of compliance,
private banking, for Credit Suisse in
core market is not Asia, says Amanda
This is because Asia typically requires
South-east Asia. How much privacy do
Chen, deputy head of wealth manage-
a different business model, skill-sets,
you allow for those vehicles and how
ment, for Nomura in Asia ex-Japan. I
people and platforms. So it is not just
do you ensure proper oversight?
expect more consolidation in the private
global scale but also the scale within
banking space to meet regulatory re-
Asia that matters.
An immediate impact of the stricter

regulatory environment is the fact that
quirements as well as to meet banks

needs of investing in technology to
Almost regardless of size, Ronald Lee,
private bankers spend a lot more time
digitise salesforce and clients.
co-head of private wealth management
today on administrative work, which in
at Goldman Sachs in Asia ex-Japan, said
turn leads to less client-facing time.
According to Van de Walle, firms with
at a recent Hubbis event in Hong Kong
less than USD20 billion in AUM may
that it is impossible to over-estimate
The broader strategic implications,
find it hard to sustain operations in Asia.
the value of having a consistent strat-
however, include forcing banks to
In line with his prediction of further
egy. Another factor that leads to
rethink where to operate. In particular,
consolidation in the Asian wealth man-
success is being true to your culture.
tax laws, cross-border rules and regulatory requirements relating to onshore
agement sector, he sees business

moving to larger companies. Smaller
From his perspective, it is key for firms
resident investors will continue to chal-
players will find it harder to offer the
to have a differentiated offering, given
lenge the traditional offshoring banking
range of products and services that the
that clients in Asia are spoilt for choice.
model, says Chen.
RE-SHAPED BY REGULATION
Regulations relating to product suit-
Speaking at Hubbis flagship wealth
These trends have come in the wake of
ability and selling processes will also
management event in Hong Kong earlier
the far-reaching impact of stricter
re-shape the industry, she adds, to move
in 2016, Lonnie Howell, chairman of
regulation over the last few years. This
away from a volatile and high-risk trans-
UCAP Asset Management, described
has re-shaped the industry for good,
actional model to a more portfolio ad-
this trend as reflective of what is going
particularly in terms of KYC and AML.
visory and management approach.
to continue to happen in the industry.
And banks are grappling with how they
regions rich are looking for.
keep pace with the scale, speed and
More importantly, as the volume and
But though the minimum size to be
costs of these and other current and
pace of regulatory change continues to
successful keeps rising, due to cost of
planned changes.
weigh on the profitability of private

banks, which in some cases have led to
compliance, pressure on margins and

the cost of technology, firms cannot
There is no excuse any longer for banks
de-marketing and industry consolidation,
ignore the importance of local scale.
not try, to the best of their ability, to
banks will need to narrow their focus.
Vision means looking to the future

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FEATURE ARTICLE
Taking advantage of this potential
As licensing regimes
change [in China], we will
move people onshore
over time and increasingly
the offshore and onshore
markets will converge.
NEIL HARVEY
Credit Suisse
however, requires, firms need to navigate effectively through the increasingly complex legal and regulatory
policies, dynamic political environment
and slowing economy.
To date, many international institutions
have dipped their toes in water, but
they still lack the full suite of licences
to do private banking or have enough
of an onshore footprint to ensure coverage on the manufacturing side, says
Neil Harvey. chief executive officer for
Credit Suisse in Greater China. As licensing regimes change, we will move
The nature of private banking is es-
ferentiation among players and have
people onshore over time and increas-
sentially suitcase banking, says Adriel
the potential to enhance wealth for both
ingly the offshore and onshore markets
Loh, managing director and global head
wealth managers and their clients.
will converge, he adds, We are posi-
of compliance at Bank of Singapore.
tioning the firm for that move.
Regulators are becoming stricter on
CHINA BECKONING
the conduct of unlicensed activities
When looking for the biggest wealth
When assessing whether to collaborate
onshore. Hence, banks do need to have
management openings going forward,
to accelerate access to the market in
a robust framework of dos and donts
however, a common question is how to
China, Bassam Salem, region head, Asia
of what can be done by a visiting RM
make the most of the China opportunity.
Pacific at Citi Private Bank, is wary of
onshore without breaching local regulatory requirements.
joint ventures. I have not seen that

This has become more tangible for in-
many successful business strategies that
ternational banks and other advisers in
are based on a joint venture.
According to Jason Lai, founder and
the wake of the slowdown of the
chief executive officer, Thirdrock Group,
Chinese economy in recent years. This
Even those institutions which have
coupled with the growing complexity
has increased the appetite of Chinese
invested directly have found China a
of doing business in multiple jurisdic-
HNW individuals for diversification and
difficult place to make money. The vast
tions, private banks particularly small-
overseas investment alternatives, giving
majority are not making money, says
to-mid sized players will have to
international wealth managers oppor-
Michael Blake, chief executive officer,
modify and fine-tune their business
tunities to gain traction in the market.
private banking, Asia at UBP. China is
models and strategies. This means tar-
a tough market in which to succeed.
geting specific client segments and
While most wealthy Chinese individu-
geographies instead of a full-service
als still prefer to manage their own
Yet he is positive about the interna-
proposition to all, he explains.
wealth and investments, they are
tionalisation of China and demand for
gradually recognising the importance
offshore products. This is a massive
This may include reconsidering re-
of professional advice to preserve their
opportunity for Hong Kong-based
gional expansion, de-marketing where
wealth and mitigate risks, explains Lai.
wealth managers.
that enhance process automation, risk
Data also suggests that these clients are
Lai says wealth managers also need a
management and relationship manage-
entrusting an increasing percentage of
thorough understanding of the specific
ment, says Lai. Strategic technology-
their investable assets to third parties, he
attitudes and approach of this diverse
related investments, in particular, may
adds, from an average of 25% of their
population of wealthy Chinese to wealth
become a best-in-class point of dif-
investable assets in 2009 to 65% in 2015.
and wealth management so they can
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Partner, Beijing
jennifer.zeng@bain.com
www.bain.com
FEATURE ARTICLE
better tailor their advice and solutions

to meet the needs of this crowd. The
newly-rich who accumulated their wealth
rapidly through the growth of innovative
industries like technology tend to be
relatively young, say Lai. Statistics
suggest that 80% of them are under 50
If we have stability and

longevity, then there is a
strong bond between the
client and the bank.
years of age. Plus, he adds, they tend to

be more aggressive in their investment
styles with a focus on wealth creation,
rather than wealth preservation.
BASSAM SALEM
Citi Private Bank
The newly-rich are the most attractive

segment also for Joseph Tam, executive
vice president and head of private
banking and wealth management at
Wing Lung Bank. They are the first
generation of new rich since the Chinese
management firms to provide sufficient
ENHANCING REPUTATION
economic reforms in 1978, he explains.
information, recommend appropriate
More broadly for the wealth manage-
They are mostly in their early 50s, they
products and more importantly, mitigate
ment industry going forward, it needs
are entrepreneurs and not familiar with
risks for their clients, adds Lai.
to work on improving its reputation

among clients for service quality.
offshore investment markets. They will

be the most profitable segment.
And apart from domestic banks, Lai

believes competition may also come
While there are various ways it can do
At the same time, the relatively early
from unexpected sources such as
this in terms of more narrowly-defined
stage of development of the wealth
WeChat, the instant messaging plat-
value propositions, many practitioners
management industry in China also
form, that has made advances into fi-
point to the need for a review of com-
means the infrastructure and talent pool
nancial services, and online commerce
pensation models.This is focused on the
may not be as established as other global
giants like Alibaba.
RMs, who are still central to the proposition, but all the other interaction points
wealth management centres. So theres

still a lot of room for investor education.
Digital delivery will be key in China,
with the customer will become more
And the opportunity here is for wealth
explains Harvey.
important as well.
Encouraging longevity of RMs would
generate the greatest benefit, according
to Howell, It would certainly ensure
The first generation

of new rich since the
Chinese economic
reforms in 1978 will
be the most profitable
segment.
enhanced professionalism over time if
JOSEPH TAM
Wing Lung Bank
at the top and stability is a positive thing,
we could stabilise management turnover

and as a result of that, RM turnover.
Ultimately, clients like stability, adds
Salem. We sometimes forget that private
banking is predominantly a relationship
business. A client can relate to the person
he explains. If we have stability and longevity, then there is a strong bond
between the client and the bank.
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FIRM PROFILE
EFG shows clear conviction

for scale
Despite recent damage to BSIs reputation, EFG International sees a lot of value in
bringing together complementary businesses to drive scale. And the pure-play Swiss
bank is acting swiftly and decisively to realise this opportunity.
It might seem an under-statement to
explains Joachim Straehle, chief execu-
say that EFG Internationals integration
tive officer of EFG International.
of the BSI business is coming at an especially challenging time. But the firms
MATCHING OF MINDS
senior management is just as convinced
It doesnt matter to Straehle that this
about the move as it always was.
deal sees the 140-year old-plus BSI tying

up with a bank which only launched in
The deal, announced in February 2016,
1995. His confidence in the cultural fit
was driven by an ambition to combine
is based on what he sees as both banks
the two private banks into a top-five
being client-focused, solution-driven
Swiss firm of a size and scale sufficient
and entrepreneurial.
to thrive in an era of costly regulation,

stiff competition and uncertain global
More fundamentally to Straehle as a
financial markets.
driver for the merger, the high cost-income ratios and challenging environ-
Eyeing the CHF170 billion (USD174
ment in terms of regulation, financial
billion) in combined AUM, those running
markets, staff retention and other areas
the show remain excited about the busi-
of private banking shows the scale
ness prospects.
required to do private banking in a prof-
JOACHIM STRAEHLE
EFG International
itable way today.

With each [of the organisations] having
a strong focus on private banking, the
This is becoming clearer to see in the
two banks have a lot in common, and by
wake of the consolidation which has
completely in some locations, and even
joining forces, we will be able to make
been underway over the past couple of
selling their businesses altogether. For
an attractive value proposition to
years in terms of banks downsizing in
those institutions which are not pure-
clients, employees and shareholders,
certain markets, closing operations
play private banks, they are increas-
12
new markets, such as in Switzerland, and
Swiss escrow account which, at closing,
across Europe, Latin America and Asia.
will contain 51 million EFG shares issued

to BTG Pactual as consideration, with
In Asia more specifically, EFG brings 320
shares locked up for two years.
staff, including 100 client relationship

officers (CROs) to the table, compared
The fine and the penalty will result in a
with 300 staff and 70 relationship man-
reduction in the purchase price. The
agers at BSI. In terms of AUM, as of the
indemnities and escrow account remain
end of 2015, EFG counted CHF16.2
unchanged.
billion, and BSI CHF12.4 billion.

From EFGs perspective, it believes that
In fact, in each region of the world,
a line has now been drawn from a Swiss
besides the UK, the combined bank will
and Singaporean regulatory standpoint
have at least CHF25 billion in AUM,
in connection with this matter.
which Straehle sees as a key number

ALBERT CHIU
EFG Bank
when it comes to size.
As a result, it should constitute another

important step to remove related regu-
NO ROOM FOR DOUBT
latory uncertainty for clients, employ-
To some observers, the crackdown and
ees, investors and other stakeholders,
enforcement action on BSI in Singapore
says the bank.
ingly aware of the seemingly disproportionate risks of providing a private

banking offering compared with the
value it brings overall.
It is not valid anymore for some firms
The merger with BSI will allow us to move to a

different league and also be in a position to benefit
from the consolidation happening in the market.
to do this type of business, adds Straehle, who says he expects to see fewer
private banks going forward. But those
which survive will be more focused on
what they do best.
(SGD13.3 million in fines) and Switzer-
EFG International also received ap-
land (CHF95 million in penalties) in May
proval in late May 2016 from the Swiss
Yet this creates a good opportunity for
and June 2016 might seem too much
Financial Market Supervisory Author-
banks with a differentiated business
for anyone to bear.
ity, FINMA, for the proposed acquisition
model, adds Albert Chiu, head of the
of BSI. This was granted on condition
Asia region for EFG. The merger with
But EFG certainly went into the deal
that BSI is fully integrated and legally
BSI will allow us to move to a different
with its eyes wide open.
dissolved within 12 months.
benefit from the consolidation happen-
What has happened [to BSI] shows why
With a view to a swift and orderly
ing in the market.
we have indemnifications in place up to
closing, the process for obtaining the
the purchase price, plus a large amount
other regulatory approvals for the trans-
of shares in escrow, says Straehle.
action is also on track, says Straehle.
More specifically, it was agreed in the
With the many employees that display
The two banks are complementary geo-
share purchase agreement that the in-
professionalism, knowledge and integ-
graphically giving each other access to
demnity will be backed by a material
rity every day at both banks, Im con-
league and also be in a position to
The merger also makes sense when

looking at a world map.
13
FIRM PROFILE
vinced we have a successful future
staff as it can as part of the integration
looks to only hire senior and experi-
ahead of us, he adds. We will work with
with BSI.
enced private bankers, they should have

an understanding of the long-term
BSI to ensure a smooth transfer of

clients and employees.
This is important for Chiu, in particular,
nature of their business.
given his expectations that the business

It is expected to complete at the latest
will significantly grow in line with op-
CLEAR VISION
in the fourth quarter of 2016, as origi-
portunities in the region.
Straehle wants to enjoy a fresh start

after integrating the platform. We want
nally announced.
And going forward, the bank will screen
to be seen as a bank which focuses on
CREATING STABILITY
clients from BSI and enforce compliance
offering private banking services, with
The integrated nature of the deal is
standards as it integrates the newly-
a global network in the regions we con-
reflected in the July 2016 appointments
acquired assets worldwide.
sider to be important, especially in Asia.
management structure for the com-
From a technology perspective, mean-
In line with this, he is determined to
bined EFG and BSI business which
while, the integration is expected to be
ensure the offering remains advice
includes five executives from BSI:
relatively smooth. For example, rather
driven, albeit making it clear that the
Renato Cohn, Reto Kunz, Maurizio Mo-
than many different legacy systems,
bank can still offer clients the asset
ranzoni, Gerald Robert, and Renato
both banks have just one Temenos for
management capability. It is always
to the executive committee and a new
important to be in the top quartile in

terms of performance, he adds, to
demonstrate to clients we can do the
asset management also.
We want to be seen as a bank which focuses on offering

private banking services, with a global network in the
regions we consider to be important.
And by focusing on what it does best,

EFG should be well-placed with its
know-how and bankers to service the
types of clients that its offering is most
suited to those individual and families
with USD10 million or more in net worth
and who have an international portfolio
and lifestyle. For these clients, we have
Santi. This will become effective as of
EFG, and Avaloq for BSI. They will con-
much bigger advantage than local
the date of the closing of the transaction.
solidate the platform using EFGs exist-
banks, says Straehle.
ing platform.
Ultimately, he doesnt see any real dif-
This should help to provide stability

and reduce any insecurity in relation to
Where there is still work to be done,
ficulties in maintaining the EFG model
the merger, says Straehle.
however, is in working to combine
and value proposition once the BSI ac-
various personnel strengths as part of
quisition is complete.
Adds Chiu: There has been a lot of
a team, to bring together individuals in
emotion around what has happened to
a focused way.
While various aspects of how the banks

operate need to ironed out in order to
BSI in Singapore, but the EFG management has worked hard to quickly outline
We do not want to continue in the old
find a middle ground, the broader objec-
our plans in terms of transferring BSI
ways of having CROs specialised in dif-
tives seem reasonably well aligned.
staff, clients and the business as soon
ferent areas, says Straehle.
Both banks see the importance of the

client being at the centre, and we want
as possible.
At the same time, the EFG model might
to give them advice, says Straehle. This
Another stabilising factor has been
also help ensure that the bank doesnt
is a business model we are very specific
EFGs commitment to taking as many
inherit BSIs problems. Given that it
and clear about maintaining.
14
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EXPERT INSIGHTS
The emergence of Asian

multi-family offices
Philippe Legrand of London and Capital Asia explains why the growth of Asian multifamily offices offers a new option for those looking for service beyond brand.
The changing landscape of Asian wealth
At the same time, for clients in Asia,
management has led to a growing
which are increasingly sophisticated
number of senior bankers offering their
and entrepreneurial investors, they
services in a regulated environment but
require more than a standard wealth
outside the traditional banking platform.
management offering to meet their

corporate, lending, wealth management
This has come in the wake of the 2008
and family-related needs.
financial crisis and various other challenges since.
According to Legrand, trends such as

the internationalisation of wealth,
For a lot of banks, wealth management
coupled with a growing focus among
is not their core business, nor does it
clients on real estate and other illiquid
account for a large part of their income.
assets, dont play to what banks want
So with a tougher market environment
to do for clients. This is because these
and greater risks of damage to reputa-
services and products are not based on
tions, banks have re-assessed whether
assets that can be put on the balance
they want to be in this business in Asia,
sheet, he explains.
beyond their home markets in Europe

and the US.
PHILIPPE LEGRAND
London and Capital Asia
In response to this, the concept of multifamily offices in Asia has emerged, says
As a result, menus have shrunk at many
Legrand. This segment now accounts
institutions, in terms of what they can
for between 5% and 10% of private
offer and what they are willing to discuss
wealth assets managed in Asia.
menus, explains Legrand, so can focus

on alternative options beyond liquid
with customers, says Philippe Legrand,

chief executive officer and founder of
By being outside the bank, these inde-
assets ranging from real estate to
London and Capital Asia.
pendent firms are not limited by any
private equity to direct investments.
16
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FIRM PROFILE
Focusing on what matters

to clients
St. Jamess Place Wealth Management is adamant that its advisers should be interacting
with clients as much as possible despite a growing administrative burden. So it has
created a support infrastructure and approach to investing to match, says Nigel Preston.
Quality not quantity is an over-used
do this if it finds suitable people: that
term, but one which rings true for St.
is, individuals who share the same
Jamess Place Wealth Management
values as the business and would there-
(SJP) in Singapore.
fore make the right fit. Because of this,

Preston explains that SJP tends to only
The firm is growing steadily, but at a rate
look for individuals with proven track
which Nigel Preston, chief executive
records from well-respected firms.
officer for the local business, is confident

wont compromise the service levels,
When a new Partner is invited on-board,
investment proposition or brand repu-
there is a suite of business development
tation that SJP proudly makes a point
managers in place; professionals who
of upholding.
are specifically appointed to provide

support, add value and help grow the
We are pursuing comfortable growth
Partners business in a safe, considered
in a way that we can manage it and
way which encourages maximum benefit
continue to deliver on our commit-
for their clients.
ments to our clients and Partners,

explains Preston.
Inevitably, this means working within
NIGEL PRESTON
SJP
the spirit of the local regulation in

BRAND PROTECTION
Singapore, to meet the expectations
SJP is realistic in its growth objectives.
of the balanced scorecard framework
It inducts around one partner a month
amid the various initiatives on the
at the moment and is looking forward
FAIR agenda.
to increasing its number of financial
Singapore at the start of 2015, it now

counts six full-time staff in this function.
advisers in Singapore from 35 to 40 by
The firm has invested to keep on top of
They spend their time, says Preston,
the end of 2016. But the firm will only
this. From a single compliance officer in
ensuring quality is assured whilst MAS
18
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FIRM PROFILE
regulations are fully understood and
When they look at the market place
adopted. SJP has also appointed group
globally, there are thousands of options
business risk managers to support the
for them to choose from. This in itself
management team.
can be confusing.
We aim to help our own Partners build
As a result, the developments in this
their businesses in the right way with
area are important to give confidence
client relationships being based on
to clients about how the firm can help
longevity, explains Preston, and un-
them with those investment decisions.
derstand how we should be servicing

our clients.
ALIGNMENT
The upshot of SJPs processes and overall
INVESTING MORE SMARTLY
approach to doing business is to ensure
In its mission to constantly bring the best
its Partners can spend more time with
value to its clients, the firm is continu-
clients on their financial plans and to
ally developing its investment offering.
understand their latest circumstances.
Local market research is conducted to
This is increasingly core to staying rel-
enhance the product range and overall
evant to clients given that people now
service, which Preston sees as a real
seem to move between locations and
differentiator: the investment manage-
change jobs more often. It is important
ment approach is not about simply
that we understand our clients chang-
bringing a UK-centric proposition to
ing attitudes to risk and their financial
clients in Asia.
and other objectives, explains Preston.
We are pursuing comfortable growth in a way that

we can manage it and continue to deliver on our
commitments to our clients and Partners.
A clear approach to
investment management
SJPs philosophy reflects its
beliefs that no single investment
house has a monopoly on
investment expertise, and it
does not employ in-house
investment managers.
Instead, it selects a number of
external managers of what it
considers to be outstanding
ability to manage its range
of funds.
This has a number of advantages.
First, it gives the firm the
freedom to select best-in-class
managers from the global
investment market to manage
its funds on behalf of its clients.
Secondly, it enables it to change
any of these managers at short
notice if it has lost confidence
in them, without any charges,
tax or inconvenience to clients.
And thirdly, it offers clients a real
opportunity to diversify their
investments by spreading their
money across funds managed
by different managers with
different styles.
ners book to someone else internally

who is capable of servicing those
We are geographically worldwide with
This is also a proposition which is de-
local flavouring. We have seen that
signed to attract Partners to join the
whether or not we already have in place
firm. All our relationships are built on
As a result, client relationships are
some local fund managers in Asia, there
longevity as part of our value-based
managed from the outset with a long
is demand for more.
reward scheme, explains Preston.
term view in mind, helping to foster a
clients, he adds.
longer term relationship.

As a result, the firm is working on iden-
This enables an individual, at a later
tifying a greater variety of fund manag-
stage, to capitalise on the recurring
We have paid out hundreds of millions
ers specialised in Asia.
income stream they have built up over
of pounds in our UK business based on
the years from the excellent service
these schemes, showing that they really
Choice is the biggest challenge our
they provided their clients. We play
do benefit both the client and the
clients in Asia have, says Preston.
the role of the broker and offer a Part-
Partner, says Preston.
20
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EVENT HIGHLIGHTS - COMPLIANCE IN ASIAN WEALTH MANAGEMENT FORUM 2016 - JANUARY
Gearing up for greater

compliance scrutiny
With the regulatory and compliance burden getting heavier and more complex than
ever before for wealth management institutions of all types and sizes in Asia the
event revealed key strategic challenges and initiatives that anyone who wants to
survive must act on quickly.
Among the many compliance-related
A clear take-away, therefore, was that it
challenges confronting financial institu-
is ever-more critical for institutions and
tions across Asia in 2016, perhaps the
advisers alike to make sure the back-
most prominent continues to be on the
ground checks and client due diligence
AML, onboarding and tax transparency
they do are done right and monitored.
sides of the business.

The various global standards and drive
While this wasnt considered the biggest
towards transparency dont just require
issue according to a sentiment poll of
new procedures, enhanced and ex-
compliance practitioners and front-line
panded. In addition, a significant chal-
advisers at our Compliance in Asian
lenge highlighted was the timeliness of
Wealth Management Forum 2016 in
these procedures.
Thank you to our sponsors

AG Delta
Amicorp Group
BRP
IMTF
Allocated Bullion Solutions
Knighthead
Swiss Asia
Thomson Reuters
Singapore in January, it is clearly the

priority for regulators.
For instance, although a lot of countries

have announced they will be early adopt-
sibilities and boundaries clear? Probably
As a result, senior practitioners said at
ers, they havent yet signed the necessary
not in most cases, said speakers. Risk
the time that the AML and tax-relating
inter-governmental agreements or put
functions were advised to turn from
reporting must remain high up on the
their own regulations in place.
being reactive to becoming proactive,
priority list for wealth management
assuming the governance structure can
organisations. This included the
Institutions must get their governance
support such decision making and re-
Common Reporting Standard (CRS) and
right in terms of operational risk manage-
sponsibility under one roof.
Automatic Exchange of Information.
ment and compliance. Are the responAt the same time, given the new reporting obligations, the industry must guard
against the risk of misinformed clients.
Ethical compliance was another area
discussed as being under more and
more scrutiny and expected to come
under a sharper regulatory spotlight.
Newer themes also emerged as issues:
information security and data privacy,
arising from various mishaps.
22
Simon Wong
Andrew Au
Andrew Chow
Byron J Murphy
Vincent Koo
AG Delta
AG Delta
BNP Paribas
Globaleye
BNP Paribas Wealth Management
David Vignola
Eileen Giam
Evelyn Koh
Joanna Yap
Joseph Kwok
Standard Chartered Private Bank
Deloitte
Standard Chartered Private Bank
KhattarWong LLP
Ex-FPAS
Woon Hum Tan
Julia Leong
Keith Harrison
Kenneth Chia
Kevin Chua
Shook Lin & Bok
PwC
Abacare Singapore
ANZ Private Bank
Amicorp
Kit Halpert
Koh Hoe Shin
Kwong Wing Leon
Lian Chuan Yeoh
Mark Buesser
Goldman Sachs
Manulife Financial Advisers
KhattarWong LLP
Allen & Overy
IMTF
Patrick Dreyfuss
Rolf Haudenschild
Stefan Kuhn
Stephanie Magnus
Steve Knabl
DBS Bank
Maroon Analytics
Baker & McKenzie
Swiss Asia
23
EXPERT INSIGHTS
Proving the value of

professionalism
CFA Institute is taking to the streets with a new initiative to drive greater
awareness of the value of the qualification and professional accreditation.
Re-affirmed in a survey released by CFA
charterholders through what we
Institute in early 2016, it is clear that
believe in and advocate, says Nick
investors today expect higher levels of
Pollard, managing director, Asia Pacific
transparency and communication than
at CFA Institute.
ever before.
FAR AND WIDE
At the same time, they are increasingly
To kick-start a new initiative aimed at
holding their investment managers to
achieving just this, the organisation
the highest ethical standards, while they
has embarked on a far-reaching brand
are, as investors, always laser-focused
advertising campaign.
on returns.
This involves billboards across key
Meeting these requirements is no easy
markets in Asia including Hong Kong,
task. But it demands a certain level of
Singapore, India, China and Australia,
professionalism, bolstered by technical
as well as in other parts of the world.
knowledge and market experience.

We want to get the message across that
NICK POLLARD
CFA Institute
This is where CFA Institute believes it
we are not just focused on an examina-
can flourish. And especially in the type
tion credential, but instead we are the
of market environment that is now con-
professional body of the investment
fronting asset and wealth managers.
management industry, says Pollard.
We intend to more strongly articulate
The headlines used in the campaign aim
vestment service and they deserve the
the value of the CFA designation to
to underpin this message. Some of these
highest ethical standards. And: 20
investors such that industry firms un-
include the following slogans, for
years of investment management expe-
derstand the benefits of employing
example: My clients expect great in-
rience and putting investors first.
24
True prosperity is
more than financial.
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to helping clients achieve their goals while enjoying peace of mind. For over a century, weve prided ourselves
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of Royal Bank of Canada and affiliates. / Trademark(s) of Royal Bank of Canada. Used under license. Above mentioned services are offered through
Royal Bank of Canada or its affiliates. This advertisement does not constitute an offer of product or service to any person in any jurisdiction to whom it is
unlawful for RBC Wealth Management to make such an offer.
EXPERT INSIGHTS
What a CFA designation

means in practice
According to CFA Institute,
practitioners who are
charterholders are uniquely
positioned to serve clients needs
for several reasons:
To give the message more meaning, CFA
the need to raise the bar higher, espe-
Institute has also called on charterhold-
cially in terms of market knowledge.
They are trained in the

highest industry standards
and best practices which
translates to world-class
investment knowledge, more
insightful questions and
deeper understanding of the
global economic climate,
resulting in greater perceived
value of client service and
firm engagement
They are bound to a clientfirst duty of care, loyalty,

disclosure and compliance,
putting investor needs first
They annually attest the

Standards of Professional
Conduct, which informs
professionalism and integrity
of capital markets, duties
to clients and employers,
investment analysis and
recommendations, and
conflicts of interests
bolstering client trust and
firm integrity
ers who are active within their local

communities to feature prominently. in
TIMING
the campaign.
It might seem like a good point in the

market cycle for CFA Institute to be
We want to show the range of people
giving some clear and strong reminders
who are charterholders, in terms of
to the investment community about the
what they do as well as the markets we
need for professionalism and integrity.
are in, says Pollard.

Few market practitioners could argue
While the messaging is consistent glob-
with the fact that the time has come to
ally, some tweaking for each local
more successfully equate the CFA In-
market is an important feature of the
stitute brand with an established profes-
campaign. In Hong Kong, for instance,
sion akin to the legal, medical and
the organisation is looking to explain
accounting professions.
Ultimately, CFA Institute says it is

focused on getting more employers to
demand professionals with the CFA
designation.
And in particular, across Singapore
and Hong Kong, for example, it is
looking to increase visibility among
private banks, family offices and investment managers.
26
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FIRM PROFILE
The role for boutiques in Asias

new wealth landscape
Febby Avianto of Falcon Private Bank explains why institutions of boutique size are more
agile and aligned with their clients both in terms of culture and outcome, and why they
have a key part to play in Asias evolving HNW and UHNW market.
Amid the polarisation of private banking
CLOSER RELATIONSHIPS PAY OFF
in Asia, the boutique players have an
To articulate where it is important for a
opportunity to shine.
private bank to deliver something different, Avianto defers to the people
Despite the many challenges facing all
factor. This comes down to the quality
industry players, as the needs of HNW
of the RM (relationship manager) and
and UHNW clients change, so too does
the understanding that they have of
the potential to offer them more than
their clients businesses and personal
just portfolios and products.
financial needs, he explains.
There is a need to not only manage their
This then feeds into ensuring a team-
wealth, but also to help them grow their
based approach.
business and navigate the relationship

between their personal and business
I have worked in big banks, but I person-
wealth, both offshore and onshore,
ally decided to join Falcon Private Bank
explains Febby Avianto, head of private
because sometimes, big banks can be
banking for Falcon Private Bank in Asia.
less flexible when meeting the many

different needs of clients, adds Avianto.
FEBBY AVIANTO
Falcon Private Bank
And these requirements remain, despite

the political or economic situation.
Investment opportunities are one such

example. For us, there is no limitation
The key, he adds, is to be flexible enough
in the same way as there might be in
to adapt to the approach that will suit
big institutions, like having to work with
Putting clients with similar goals and
each client. This is made possible within
the investment banking side of the busi-
interests together is also an important
a bank with a staff of 400 compared with
ness, or requiring minimum revenue to
value-add. Take a client in the prop-
a bank which has over 10,000 employees.
do a deal, he explains.
erty business, for example, who needs
28
FIRM PROFILE
financing for his building. Their local
that new wealth gets created in pockets.
bank will likely charge them a rela-
Coffee and rubber, for instance, come
tively high interest rate due to the
from the small city of Lampung, requir-
nature of such a project.
ing bankers to get close to the producers

and distributors of tractors.
This is where Avianto says the bank can

help. We dont only help the client who
Thats why we believe having a sea-
has a hotel he wants to sell, but I will
soned private banker who also under-
find a client who wants to buy that
stands the corporate banking market is
hotel, he explains.
necessary, says Avianto.
Falcon Private Banks

three-pronged value
proposition
Swiss heritage

To do this, you have to understand each
They need to be able to talk about the
clients business, he adds.
business, he adds.
This relies initially on an RM being able
Mining these opportunities also involves
to talk to clients about the palm oil in-
Falcon Private Bank collaborating with
dustry, for instance.
local asset management companies and
People

securities firms in each market.

This might then generate further advisory business as a result of uncovering
The rationale, says Avianto, is that global
a need a client might have to hedge a
transparency has made confidentiality
position, for example, or to structure a
redundant as a differentiator.
private equity deal.

This is forcing banks to compete purely
Being able to act quickly is another
on their services, meaning customisation
benefit of a boutique bank that Avianto
based on an understanding of the client
believes matters in such a match-
and the local regulatory environment.
making role.
The new tax amnesty in Indonesia is a

LOCAL FLAVOUR
good example, he adds.
As part of Falcon Private Banks aspirations for growth and deeper pene-
SOLID BACKING
tration in the key markets in South-
Although Falcon Private Bank can
east Asia, Avianto is focused on making
promote its agility due to its size and
sure he has the right RMs targeting
structure, Avianto recognises the value
the right clients.
of being ultimately owned by a sover-
We need to have local RMs to provide

Clients have more faith in us for being
ing our target markets, and they are
owned by IPIC, as the sovereign wealth
not just looking at the big cities, but
fund of Abu Dhabi, which is still rela-
also venturing into other parts of the
tively secure, he says.
country where we understand what

different types of clients in these places
In addition to the financial stability that
need, explains Avianto.
IPIC provides, it is a supportive parent,

as Falcon Private Bank looks to grow in
In Indonesia, for example, some indus-
Asia and maintain its emphasis on being
tries only grow in certain cities, meaning
entrepreneurial.
30
A genuine entrepreneurial
spirit and strong flexibility
with clients interest at
the centre
An experienced
management team in Zurich
to build on a track record
of service excellence and
flexibility throughout the
international franchise
Much greater importance
on relationship quality
than quantity, with each
RM in Asia only managing a
select group of clientele to
ensure personal dedication
and highly-customised
financial solutions
Sustainable growth
eign wealth fund.

local content and knowledge in cover-
A Swiss-made experience
backed by 50 years of
advisory and investment
competence to its clients
The Swiss heritage caters
to HNW individuals,
entrepreneurs and wealthy
families in Asia
Organic expansion and

strategic focus on select
and emerging markets
(Switzerland, Eastern
Europe, GCC and Southeast Asia
A solution-driven approach
breeds core offerings in
Asia of portfolio and asset
management, advisory and
client lending
From a regional hub in
Singapore, growth plans
are focused on Indonesia,
Malaysia and Thailand
EVENT HIGHLIGHTS - ASIAN WEALTH MANAGEMENT FORUM 2016 - HONG KONG - FEBRUARY
Redefining business and

advisory propositions
Panelists at Hubbis 6th annual Asian Wealth Management Forum in Hong Kong in
February 2016 highlighted the importance of long-term thinking to business models,
scalability and how advice is delivered.
Perhaps the most significant take-away
tion. Until compensation models are
from this get-together of 300-plus high-
aligned with long-term goals and clients
profile industry practitioners was the
best interests, practitioners say the
face that far-reaching changes are un-
industry will struggle with its evolution.
derway in Asian wealth management,

especially in the private banking space.
Private banks were also considering

how important scale is to their likely
More specifically, speakers discussed
success, on the back of various an-
the fundamental shift taking place
nouncements around consolidation,
which should, ultimately, be good for
most notably the EFG-BSI deal a couple
the industry, clients and shareholders
of days before this event.
alike: greater transparency, more liquidity, and enhanced regulatory oversight
Yet local scale is also a key factor , given
along with the banks responsiveness
that Asia typically requires a different
to this. This reinforces the need for
business model, skill-sets, people and
institutions to identify and leverage off
platforms.
what they are good at, rather than trying

to be all-things-to-all people.
Meanwhile, the increasing influence

and numbers of independent asset
Another strong theme was the impor-
managers and multi-family offices is
tance of incentives as a key tool in build-
also considered positive for ensuring
ing the right type of advisory proposi-
the long-term interests of clients.
32

Amicorp Group
Infosys Finacle
EY
Henley & Partners
Labuan IBFC
Morningstar
Numerix
Old Mutual Global
Investors
Principal Global Investors
Vermilion Software
AB
AXA
BEA Union Investment
BVI House Asia
Deutsche Bank Wealth
Management
Enhanced Investment
Products
Fundinfo
Global Prime Partners
HSBC Global Asset
Management
IIFL Private Wealth
Intertrust
J O Hambro Capital
Management
Legg Mason
Swiss Life
SwissAsia
Thomson Reuters
Tikehau Investment
Management
Albert Chiu
Anthonia Hui
Antoine Candiotti
Arjan de Boer
David Varley
EFG Bank
AL Wealth Partners
Indosuez Wealth Management
ANZ
AXA
Eleanor Wan
Eli Bitan
Eric Lu
Freeman Tsang
Gaurav Kumar
Wingate Asset Management
Deloitte
Legg Mason
Harmen Overdijk
Jan Bellens
Jeroen Buwalda
Jessica Cutrera
Rohit Bhuta
CAIDAO Wealth
EY
EY
EXS Capital Asia
Crossinvest
Malik Sarwar
Michael Levin
Norman Chan
Peter McMillan
Philippe Legrand
HSBC
Credit Suisse
NAB Private Wealth Advisory
Thomson Reuters
Pius Zgraggen
Riccardo Lehmann
Richard Collis
Roger Bacon
Roger Steel
OLZ
Swiss Asia Asset Management
Willis Towers Watson
Citi Private Bank
Sun Life Financial
33
Steffen Schade
Ron Lee
Sameer Chishty
Wing Chan
Xavier Burkhardt
AIA
Goldman Sachs
Streeton Partners
Morningstar
Tikehau Investment Management
Abhra Roy
Aksel Kitowski
Damien Ryan
Diamond Lee
Jennifer Lai
Infosys Finacle
Numerix
Ryan Communication
Old Mutual Global Investors
Henley & Partners
Kees Stoute
Marcel Kreis
Peter Golovsky
Seamus Donoghue
Shanker Iyer
Hubbis
Hubbis
Amicorp Group
Iyer Practice Advisers
Hubbis is performing a very valuable service in bringing a lot of

[industry practitioners] together, putting them on the stage and
making them express opinions allowing a large audience to
formulate views. It is an industry-enhancing activity.
Lonnie Howell, Chairman, UCAP Asset Management
Lonnie Howell
UCAP Asset Management
34
Your Access to
Emerging Markets Opportunities
Zurich | London | Abu Dhabi | Dubai | Singapore
FEATURE ARTICLE
Will private banking in Asia

thrive or wither?
As consolidation gathers pace and polarisiation within this segment continues in the face
of rising costs and thin margins, how should private banks adapt to thrive?
Merrill Lynch which, at USD1.44 trillion,
International banks tend

to offer access to a wider
range of products, services
and expertise that UHNW
clients are more likely to
benefit from.
BERNARD RENNELL
HSBC Private Bank
was marginally ahead of Morgan Stanley.

There is then a big gap to Credit Suisse
in fourth place with USD687 billion in
AUM, followed (in this order) by RBC,
Citi, JP Morgan, Goldman Sachs, BNP
Paribas and Deutsche Bank to round out
the top 10.
Even the average rise in net new asset
growth of 33% on last years figures
could not compensate for the lower
values of client assets, the study found.
Asian private banking, on the whole,
also reflects the difficulties in making
Some of the recent global AUM figures
notable slowdown in AUM and a
the model work. Plus, Recent exits/
for private banks highlights the extent
squeeze on operating margins with
sanctions in the Asian region Barclays,
of the challenges that many of these
market conditions and hesitant clients
BSI, Societe Generale, to name just a
institutions face.
also suggesting tough times ahead.
few show that the landscape is getting

more competitive.
Research released by Scorpio Partner-
Against this backdrop, UBS kept its place
ship in mid-July 2016, for example,
at the top of the Scorpio Partnership
Private banks are also realising that
highlighted the challenges that the
global ranking of the 25 largest wealth
although wealth in Asia is growing as
worlds biggest firms face in achieving
managers, with more than USD1.73 tril-
advertised, accessing this wealth is not
growth. Most institutions showed a
lion in AUM, followed by Bank of America
as easy as they think.
36
The best of both worlds
Personal attention, customized

advice, tailor-made portfolios
Independent asset manager

operating without any
conflict of interest
European and Asian expertise

HP Wealth Management (S) Pte Ltd
137 Telok Ayer Street #08-05
Singapore 068 602
Tel. + 65 6603 9790
www.hpwm.sg
Urs Brutsch
Assets are with

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Managing Partner & Founder
Michael Foo
CIO & Partner
Stephane Schmid
Partner
A subsidiary of Horus Partners Wealth Management Group SA, Geneva
FEATURE ARTICLE
ment providers to increase their share

of wallet, she believes.
Another factor that leads

to success is being true to
your culture.
Private Banks and wealth managers

will need to focus on their core competencies and areas where they can
demonstrate a clear value proposition
in order to benefit from the rise in
wealth [in Asia], she says.
RON LEE
Goldman Sachs
Some of the key components necessary

for survival and success, according to
Amanda Chen, deputy head of wealth
management, for Nomura in Asia exJapan, are digital offerings in execution
and portfolio reporting, quality advi-
Notable in the Scorpio Partnership re-
lenges around operations, technology,
sory consultations and services, and
search, however, was the arrival of two
and talent management.
having a niche in the market where the
Chinese banks in the top 25 China
institution operates.
Merchants Bank and ICBC both of
The good news, says Jing Zhang Brogle,
which saw significant AUM growth on
chief executive officer of Edmond de
For Alvin Ma, Hong Kong-based senior
the year before.
Rothschilds Hong Kong branch, is that
managing director and head of private
research shows that many of the Asias
banking at EFG Bank, it is all about fol-
STILL SCOPE FOR OPTIMISM
HNW individuals hold less than one-third
lowing a certain type of model. This
The various and mounting pressures on
of their wealth with a wealth manager.
includes: being AML/KYC/CDD clean
private banks are compounded by a
and compliant; offering managed advi-
combination of shifting client demo-
So there is considerable opportunity for
sory rather than execution only; focus-
graphics and needs, and existing chal-
private banks and other wealth manage-
ing on solution-driven not just broker/
KEY PERFORMANCE INDICATORS FOR THE GLOBAL WEALTH MANAGEMENT INDUSTRY

Key Perform
mance Indicattor
Asse
ets under management
Average
A
perce
entage changee YoY
TOP 25 BANK
KS
2015
ALL BANKS
2015
2
ALL BANK
KS
2014
-1.7%
-1
1.0%
+2.0%
Net n
new money
+33.0%
-6
6.9%
+18.4%
Incom
me
+1.1%
+0
0.5%
-4.3%
Expe
enses
-2.4%
+1
1.4%
-5.2%
Operrating profits
-4.7%
+0
0.6%
+9.3%
TOP 25 BANK
KS
2015
ALL BANKS
2015
2
ALL BANK
KS
2014
Key Perform
mance Indicattor
Cost income ratio

HNW
W Client Engag
gement Score
75.1%
80
0.0%
81.4%
68.6 (/100)
69.9
9 (/100)
69.2 (/100
0)
Source: Scorpio Partnership Global Private Banking Benchmark 2016 and Scorpio Partnership Client insight database, 2016
38
LETS SIMPLIFY THINGS.
Personal Wealth Management for the New Millennium
www.caidaowealth.com
FEATURE ARTICLE
dealer-oriented services; having qualified, competent and licensed professionals; providing asset protection as
well as asset growth; and advising on
corporate advisory in lieu of net-worth
monetisation.
[Clients] expectations
in terms of yield on their
investments have come
down quite dramatically.
There will be further industry economies of scale via consolidation, in terms

of NNA, AUM, ROA, cost-income ratios,
formula-based compensation, and talent
development and retention, he adds.
FREDRIK LAGER
SEB Private Banking
This also shows the importance of what

international banks can bring to the
table over some of the domestic
players amid expectations that local
private banks will play a greater role
At the same time, Bernard Rennell,
In this respect, he believes that inter-
going forward.
regional head of global private banking,
national banks tend to offer access to
Asia-Pacific, global head of family gov-
a wider range of products, services and
NEW CLIENT DEMANDS
ernance and family enterprise succes-
expertise that UHNW clients are more
sion, HSBC Private Bank, says that
likely to benefit from. This can range
when a client is considering the right
from access to investment opportuni-
private bank for their needs, one of the
ties, including access to hedge funds,
top concerns is how to find a bank that
private equity funds and real estate club
understands the region, and therefore
deals worldwide, he explains, as well
their needs, while giving them access
as wealth planning services, such as
from those before.
to investment products and wealth
family governance, trust and company
solutions that help them achieve their
administration and philanthropy advi-
Plus, adds Fredrik Lager, general
long-term goals.
sory services.
In line with the generally savvier, more

demanding HNW individuals, in part
due to the rise in availability of information via the web and increased market
competition, the products and services
they are looking for today are different
manager at SEB Private Banking in Singapore, clients are much more cautious
today compared with only a year ago.
Their expectations in terms of yield on
their investments have come down
TYPES OF INITIATIVES TO CLOSE PROFITABILITY GAP
quite dramatically.
In line with this, clients are now looking
for something extra from their private
bank guidance and direction, not only
on investments, but also on family,
philanthropy, retirement, succession
and estate planning.
It is less transaction focused and more
sophisticated financial planning, says
Marc Van de Walle, global head of products at Bank of Singapore.
40
Source: Oliver Wyman analysis
FEATURE ARTICLE
Clients also increasingly expect to play

a more active role in managing their
portfolios. As a result, clear and full
accountability in advisory services and
execution is important.
There will be further

industry economies of
scale via consolidation.
Standardised product offerings are no

longer sufficient to compete, says
Chen. Clients expect banks to be able
to provide wealth solutions beyond the
investment portfolio, for example, M&A
advisory, corporate finance and other
ALVIN MA
EFG Bank
investment banking solutions. They also

expect transparency in fees, potential
returns on investments as well as tailored advice.
Private banks should also rise to the
be searching for new ideas to diversify
long-term plan, explains Brogle. Trust
independent asset management (IAM)
their client base, tap potential in un-
is also key. Many clients have multiple
challenge. According to Thusitha de
tapped markets, enhance accessibility
private
Silva, director at Cerulli Associates, they
to services through digital tools, focus
However, she adds, we are seeing a
can provide opportunities for opening
on value-added advice and, at the same
gradual shift to consolidating their
up alternative revenue streams. Instead
time, have a strong risk management
assets with fewer relationships. They
of looking at IAMs as a threat, private
framework for clients as well as product
prefer to go with banks they can trust
banks should cooperate to form an
due diligence.
and who offer them the best value
banking
relationships.
proposition to suit their needs.
ecosystem where [everyone] can mutually benefit, he explains. We see this
Further, beyond access to the latest
happening to some extent in Singapore.
products or new ideas, ever-more im-
Asian wealth managers also need to
portant to clients is receiving relevant
differentiate between the needs of the
More generally, in a falling fee environ-
guidance and timely advice. They ap-
newer millionaires and those who have
ment and as investors become more
preciate that we can help them achieve
held their wealth for longer periods.
savvy, he says private banks should also
their objectives with a holistic and

China is where most new millionaires are
found; whereas other countries will comparatively have more second- or thirdgeneration wealth. The latter will be open
Following the tide of

digital banking, private
banks have to build up
digital platforms for
communication, execution
and client servicing.
to discretionary services, while the former

should be approached with advisory solutions first, says Van de Walle.
In addition, adds Michael Blake, chief
executive officer, private banking, Asia
at UBP, there is growing internationalisation of Chinese wealth.
ALAN LUK
Hang Seng Bank
The business has reached greater maturity a decade on, he explains, and
Chinese families are much more open
42
Swaen Capital Pte.Ltd.
No 8 Eu Tong Sen Street

#19-89 The Central
Singapore 059818
Tel: (65) 3109 1932
Email: clientservice@swaencapital.com
FEATURE ARTICLE
to traditional wealth management services than they were before. The other
big change is a greater openness to
diversification and a desire for an international footprint that wasnt relevant
to a lot of people before.
INVESTING IN INFRASTRUCTURE
Chinese families are

much more open to
traditional wealth
management services
than they were before.
Other than a comprehensive suite of

products and range of solutions, having
the right infrastructure and people has
hence become essential for private
MICHAEL BLAKE
UBP
banks to succeed.
At Bank of Singapore, for example,
Van de Walle says technology has
become important in the quest for
operational efficiency, to be able
banking, private banks have to build up
CONSISTENCY AND CULTURE
manage costs, mitigate risks and give
digital platforms for communication,
Regardless of size and style of offering,
more value to clients. We are invest-
execution and client servicing.
to Ronald Lee, co-head of private wealth

management at Goldman Sachs in Asia
ing in cybersecurity, data management, data analytics and surveillance.
Yet having this technology and infra-
ex-Japan, says it is impossible to over-
For advisory, we are investing in port-
structure is not the end-goal in itself.
estimate the value of having a consis-
folio analytics so that we can advise
The rapid advancement of financial
tent strategy. Another factor that leads
clients in a timelier manner, with more
technology has prompted numerous
to success is being true to your culture.
details in terms of performance at-
discussions about whether the machine
tribution and risk management.
can replace the banker, says Van de
He added that it is key for firms to have
Walle. My answer to this question is,
a differentiated offering, given that
The goal, he explains, is to enable
until the machine can sense a human
clients in Asia are bombarded for choice.
private bankers to provide data for
beings exuberance or fears, not yet.

This is perhaps even more important in
clients who want it, anytime, anywhere

and on any device.
Indeed, understanding clients needs
an environment where there are clearly
will always remain paramount to the
more challenges ahead.
According to Chen, fintech will change
business of private banking. Getting
the way private banks do business.
to really know a client and understand-
These include more competition from
They are in competition with non-
ing their subtle needs is something
non-financial companies that are pro-
banks in offering multi-channel and
technology cannot do, he adds. I
viding alternatives to private banking
digital models which offer transparency
believe humans require humans to in-
services, such as IAMs.
and speed in execution, she explains.
teract with in the field of investments.

Against this backdrop, private banks
The mobility of services and information will change clients behaviour to
As a result, recruiting the right talent
have to figure out their strategies and
become more self-directed, and the
continues to be the key for growth for
positioning, says de Silva, as more
relationship managers relevance in an
all private banks.
sophisticated aspects of wealth management like asset selection, alloca-
advisory role will be challenged.

Indeed, explains Chen, intelligent,
tion and rebalancing of portfolios
Aggress Alan Luk, head of private
technical and finance savvy advisers
become automated and available to
banking and trust services at Hang Seng
will be imperative as markets become
a wider wealth spectrum of investors
Bank: Following the tide of digital
more complicated.
at lower cost.
44
WEALTH PLANNING
You know where to go.

We know how to guide you there.
Moving abroad can be very complicated. There are many things to consider, including the requirements of the
different regulatory regimes to which cross-border wealth planning is subject. Let us guide you through the
legislative labyrinth, and help you avoid unnecessary, time-consuming paperwork, as well as any unwelcome
(and often expensive) surprises along the way. No matter where life takes you, Nordeas in-house wealth planners
and their external network of experts can ensure that you are well prepared to meet the challenges that moving
abroad brings. Find us at www.nordea.sg/contacts or call +65 6597 1070 to arrange a meeting.
Nordea Bank S.A, Singapore Branch is part of Nordea Group, the leading financial services group in the Nordic and Baltic Sea regions. Some products and services may, due to local regulations, not
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subject to the supervision of the Monetary Authority of Singapore (www.mas.gov.sg).
EXPERT INSIGHTS
Why private banks will

live or die on innovation
BNP Paribas Wealth Management has carved out billionaires as a strategic growth
segment, says Mignonne Cheng, explaining that this is an industry where being
innovative and providing real solutions will be the difference between success and failure.
Despite the many challenges facing
is balanced with the fact she also knows
private banks in Asia, recent signs
the status quo faces imminent change.
suggest this is an industry that continues

to thrive.
I believe consolidation of the industry

is likely to continue, as private banks
A quick look at the latest World Wealth
need to achieve scale and efficiency,
Report from CapGemini, for example,
she explains.
support this. It shows the pace and

volume of growth, with Asia Pacific ex-
And as someone who has been active in
ceeding North America for the first time.
the regions financial markets for well

over three decades, she is well-placed
The spotlight on compliance and gov-
to judge the likely evolution in the look-
ernance is a crucial factor too. The
and-feel of the marketplace.
high bar for capital requirement, the

increased transparency and greater
STAYING AHEAD
scrutiny from regulators, and the
The way for private banks to ensure
prudent approach of private banks to
success amid todays challenging envi-
business management, will provide
ronment will be to work hard at innova-
clients with a stronger sense of safety
tion. This is in order to maintain rele-
and trust, says Mignonne Cheng,
vance and better serve clients
chairman and chief executive officer
ever-changing needs, says Cheng.
MIGNONNE CHENG
for BNP Paribas Wealth Management

in Asia Pacific.
In particular, she explains, when
touch, highly-tailored, holistic yet
dealing with UHNW families, there is
trustworthy personal services of hand-
Yet at the same time, Chengs bright
no other type of offering which can
picked, rigorously-selected and
outlook for private banking in the region
provide the same combination of high-
trained private bankers.
46
They must consistently present the
Identifying the next

entrepreneur
Another sign of the innovative
nature of BNP Paribas Wealth
Management was its 2016
BNP Paribas Global
Entrepreneur Report.
The survey revealed the
emergence of a new generation
of entrepreneurs under 35
years old.
Dubbed the Millennipreneurs,
these are business starters from
Generation Y, born between
1980 and 1995, also known
as Millennials.
Their approach to business, in
terms of their ambitions, results
and leadership style, differs
from that of other generations.
For example, they create
more companies, with larger
headcounts and higher
target profits.
They are also generally
interested in the new economy,
but are equally active in many
traditional sectors including
retail and professional services
such as law and accounting.
The report was based on a
survey conducted by Scorpio
Partnership, analysing the
behaviour of roughly 2,600
HNW and UHNW entrepreneurs
across 18 markets in Asia,
North America and Europe, with
aggregate wealth of over
USD17 billion.
right ideas to clients, seriously taking

into account the relevant risk profiles
of those clients.
SERVING THE MEGA WEALTHY
IN ASIA
This is perhaps most relevant for the
ultra wealthy, which is an increasingly
important target segment for BNP
Paribas Wealth Management.
In line with this, the bank is rolling out
a new initiative, Mega Wealth, to focus
on the wealthiest individuals.
This follows on from the success that
the private bank has found over the last
few years in on-boarding billionaire
clients. Indeed, it has reached a penetration rate of 17% in Asia, and close to
50% in Hong Kong.
This client segment calls for a holistic
banking approach, integrating investment banking and wealth management
Supporting wealthy
women
As part of its continued
approach to clear segmentation,
for the second year, BNP
Paribas Wealth Management
brought together (in July 2016)
around 30 women who lead
international fast-growing
businesses in 12 countries
across Europe, the US, the
Middle East and Asia, from
which there has been strong
participation both times.
This exclusive Women
Entrepreneur Programme
aimed to provide participants
with a programme specifically
geared to the real issues facing
entrepreneurs, along with the
opportunity to network and
discuss their views on growth,
innovation and leadership.
The customised training
programme was designed by
Stanford University.
solutions, says Cheng.
The billionaire segment is our strategic growth lever.

BNP Paribas Wealth Management is gearing
up its value proposition to this segment,
in order to remain as the preferred partner to this
increasingly-important population of clients.
For example, this demands specific
BNP Paribas Wealth Management is
credit solutions as well as private invest-
gearing up its value proposition to this
Private bankers, as the last bastion of
ment opportunities as two of the key
segment, in order to remain as the pre-
trust, must also maintain an enhanced
drivers of the initiative. The billionaire
ferred partner to this increasingly-
awareness of their clients interest and
segment is our strategic growth lever,
important population of clients, she
protection, explains Cheng.
adds Cheng.
explains.
47
EXPERT INSIGHTS
Maybank keeps focus on

sustainability in private wealth
The Malaysia-based bank is continuing to build-out its offering to HNW clients at home
and across the region, but with the focus on ensuring that any bankers and client assets
are sticky, says Alvin Lee.
Alvin Lee has a clear vision about the
Maybank has also implemented a new
growth he wants to see for the private
Avaloq platform to ensure it has the
wealth business over which he presides
right IT systems and processes to deliver
at Maybank but he is also willing to
an enhanced suite of products and ser-
take his time in ensuring it is the right
vices to what was largely a retail-ori-
type of growth.
ented business previously.
More than two-and-a-half years since
Now, the priority is scaling up in order
the Malaysian banking group launched
to drive performance and mainly at
a formal offering for HNW and UHNW
the front-line. But this doesnt just
individuals, Lee believes things are well
mean hiring to bulk up the numbers at
on the way to making the investment
the expense of the strategy of longer-
worth it.
term sustainability that Lee is adamant

about maintaining.
For example, he counts roughly USD11

billion in AUM across three booking
We need to hire relationship managers
centres, including the units hub in Sin-
(RMs), but they need to be the right
gapore, Malaysia and Hong Kong as a
people who also are a cultural fit for us,
newer, smaller location.
he explains.
This has come from a combination of
This comes down to how they view
onboarding some of the wealthier exist-
their careers and also the approach
ing clients from the retail bank onto the
they take to advising clients. In line with
to bring in bankers who are focused on
private wealth platform, as well as at-
this, Lee stresses the importance of the
developing a long-term career in
tracting new clients to bring assets to
bank ensuring that its customers make
private wealth management not
the business.
money too. To achieve this, he wants
simply look to push products.
48
ALVIN LEE
Maybank
THINK INDEPENDENT. THINK TTG

TTG is a leading independent private wealth manager, committed
to providing unbiased professional investment advice to private
clients, companies, trusts and charitable organisations.
Our goal is to develop long-term partnerships with our relationship managers
and clients, founded on mutual trust, where the preservation and ongoing
management of our clients wealth is the primary objective.
We are regulated by the Securities and Futures Commission of Hong Kong
and are part of the Swiss private banking group CBH Compagnie Bancaire
Helvtique SA.
Suite 501A, 5/F, 9 Queens Road Central, Central, Hong Kong

Website: http://www.ttg.com.hk/
Email: info@ttg.com.hk
Tel: +(852) 2869 0801 Fax: +(852) 2523 4610
EXPERT INSIGHTS
TAKING ADVANTAGE
PERKS OF BEING FRESH
While on one hand the timing for expan-
Starting a private wealth proposition
sion might not seem ideal given the
from scratch has also enabled Lee to
wider market environment, there will
benefit from the advantage of not having
always be challenges and questions over
to deal with a lot of the legacy systems
the right time.
and processes which weigh down some

of his peers.
The Asian private banking industry, for

example, is characterised by high costs
He also applies this type of thinking to
in terms of regulation and the general
implementing his plans for aiming to do
running of the business.
more digitally.
Indeed, this has been a factor over the
Yet it is still early days. So, for the time
past 12 to 24 months in many European
being, he says he is looking to leverage
private banks, in particular, reviewing
on the other parts of the Maybank
the extent and scope of their operations
group, such as the Kim Eng securities
in Asia.
venture and the retail bank.
The private wealth industry has to be

very careful not to let costs escalate to
the point where they cannot sustain or provide
the required level of service or solutions.
The private wealth industry has to be
Ultimately, he wants to continue to
very careful not to let costs escalate to
focus for the time being on those client
the point where they cannot sustain or
leads which are what Lee calls warm.
provide the required level of service or

solutions, says Lee.
The conversion rate so far has been

around 65%.
He is also aware of the need to be more

creative in how and where he looks for
In another two to three years time, he
new talent to bring on board.
wants to have between 6,000 to 7,000

private wealth clients the rationale
And he sees a big opportunity to hire
being, that if each of them has, on
corporate and investment bankers into
average, between USD2 million and
a private banking role.
USD5 million with Maybank, then Lee

can look to roughly USD20 billion in
There is a lot of re-tooling and training
AUM. This is what he believes is the
needed to do this, but this shows that
minimum critical mass to work with in
there are potentially other areas to tap.
todays market.
50
Getting the ball rolling

The birth of the private wealth
component of the Community
Financial Services (CFS) business
at Maybank, essentially meant
the creation of a new unit.
The bank realised the potential
to access a ready-made
customer pool through a more
dedicated offering. This could
also help it generate new income
streams and meet growing
demand from customers for a
broader service.
In Malaysia, for example,
Maybank has more than 12
million customers, and is the
largest bank with No.1 overall
market share in consumer loans,
retail deposits, unit trusts, loans,
retail fixed deposits and CASA.
The group also has a presence in
all 10 ASEAN countries.
Lee was then hired to take
charge of the private wealth
business and harvest what
the bank saw as a segment
which was rightfully already
its own. And it took a logical
step by basing the team out of
Singapore. This enables it to
service a combination of local
clients as well as use its offshore
desk to cater to clients based
overseas but who want to bank
in Singapore.
The view was that in the
medium term it could be a
source of liquidity, and in the
longer term, one of profitability.
Even though it was decided to
position the private wealth arm
within the consumer bank, the
strong collaborative culture in
the group ensured it is closely
linked to the corporate and
investment banking divisions.
FIRM PROFILE
How HSBC is pursuing its

desired private banking model
HSBC Private Bank took some bold decisions a few years ago to redefine its risk appetite.
With a clearer sense of the type of business it wanted to do, and with whom, this mandate
had allowed Sandeep Sharma, its head of South-east Asia, the opportunity to position the
business for growth.
The first half of 2016 has been a tough
Everything we have done in recent
time for all private banks.
years is based on pursuing that vision,

explains Sharma.
The generally-unfavourable investment

environment due to the volatility and
AHEAD OF THE CURVE
uncertainty has resulted in lower bro-
The strategy review that the bank did a
kerage and trading activities, worldwide.
few years ago was important in enabling

it to define its risk appetite.
This has highlighted the importance of

business models built on more in-depth,
For example, it defined the markets in
needs-based conversations with clients,
which it wants to grow, resulting in a
stemming from a deeper understanding
consolidation leading to it operating
of their needs and goals.
today in key growth markets where the

bank has a well-established HSBC
For HSBC Private Bank, this is exactly
Group presence.
the direction it has been heading.

It also combed through its client book
We have defined our strategy as being
to ensure that it banks with only the
the preferred private bank for clients
right kind of clients, where they are com-
of the wider group, says Sandeep
mitted to being compliant with its tax
Sharma, head of global private banking,
transparency requirements and efforts
South-east Asia at HSBC Private Bank.
to combat financial crime risk.
SANDEEP SHARMA
HSBC Private Bank
private banking industry will become

This includes servicing its commercial
In Sharmas view, this was a forward-
uniform. Ultimately, a banks platform
banking customers, to meet their per-
thinking move. Over the next five years,
and proposition will define its success,
sonal wealth needs.
I think the risk appetite for the whole
not only its ability to arbitrage risk.
52
Hong Kong
BVI
Singapore
Asian Focus,
Global Solutions
Asias Leading Trust and Corporate Services Firm

Singapore
Hong Kong
Heritage Fiduciary Services Pte Ltd
Heritage Corporate Services (HK) Limited
50 Raffles Place,
#15-05/06,
Singapore Land Tower,
Singapore 048623
Tel: (65) 6533 0774
Fax: (65) 6533 0224
Email: info@heritagetg.com
www.heritagetg.com
902, 9th Floor,

Loke Yew Building,
50-52 Queens Road Central,
Hong Kong
Tel: (852) 2527 9396
Fax: (852) 2527 0762
Email: hkenquiry@heritagetg.com
BVI
Heritage Trust Services (BVI) Limited
Ground Floor, Coastal Building

Wickhams Cay II,
Road Town, Tortola
British Virgin Islands VG1110
Tel: (284) 494 7077
Fax: (284) 494 7078
Email: info@heritagetg.com
FIRM PROFILE
In terms of segmentation, although
We see numerous cases where clients
HSBC Private Banks minimum invest-
have a requirement for their business
ible assets for new client is USD5
at short notice. If they have an existing
million, given its focus is on serving the
relationship with the private banking
private wealth needs of HSBCs com-
division, it gives more confidence to
mercial banking clients, it has intro-
the commercial banking team to turn
duced a Private Wealth Entrepreneur
around a solution very quickly, ex-
(PWE) programme.
plains Sharma.
PWE is an incubator proposition offered
This works the other way round too.
to HSBC Commercial Banking clients
For the banks commercial banking
who are on course to building busi-
clients, given that much is known about
nesses and, as such, expected to create
them and their business, it is much
wealth in the coming years. Essentially,
easier for the private banking business
these clients get to enjoy HSBCs private
to consider the individual as a client by
banking solutions and services even if
already having background on their
they might not meet the minimum in-
business and how theyve accumulated
vestible assets.
their wealth. Clients prefer to deal with

banks which know all aspects of their
From Sharmas perspective, the upshot
business and their family, he adds.
of this re-positioning has created capac-
HSBCs Private Wealth

Entrepreneurs Proposition
This was introduced globally
in 2014 to provide access for
existing commercial banking
clients to private wealth
solutions and advisory.
It is offered to HSBC Corporate
and Business Bankings most
valued and high-potential clients
that are on the path to creating
their personal wealth through
their businesses.
The bank adopted a teambased service model, whereby
a dedicated team comprises an
RM, relationship executive and
wealth adviser, to provide these
clients with wealth advisory and
investments solutions.
ity for the team to grow its business in
ADDING CAPACITY
South-east Asia, by effectively tapping
Sharma is certainly not complacent.
into the rising affluence in ASEAN.
We now need to add capacity.
For example, in the 2016 Boston Con-
There are various approaches that the
erational wealth, he adds. Given that
sulting Global Wealth report, Asia
bank is taking. One of them is to create
HSBC has one of the largest corporate
Pacific (ex Japan) is expected to hold
greater efficiency and improve produc-
banking portfolios globally, we will
a projected USD60 trillion of wealth
tivity by ensuring its employees have
benefit greatly if we are able to hone
in 2020.
the necessary training and resources
in on our collaboration framework with
to reach his or her potential.
other group businesses and offer Asia
It is also likely to surpass Western
business owners with a comprehensive
Europe as the second wealthiest region
The bank is also selectively recruiting,
in 2017. The report also highlighted that
especially for seasoned relationship
Asia Pacific (ex Japan) is projected to
managers (RMs), product specialists
Yet size is less important compared
hold 27% of global wealth in 2020 and
and middle-office personnel to better
with client satisfaction and the speed
its growth is largely driven through
tap into potential opportunities that
of providing relevant solutions.
creation of new wealth.
lie within its commercial, corporate and
suite of private wealth solutions.
retail banking divisions.We have a lot
It also needs to be about more than just
THE BANK OF CHOICE
of untapped potential internally, explains
bringing in people in order to just bulk
The HSBC Private Bank mission is to
Sharma. Last year, net new money glob-
up the numbers. Sharma is looking
leverage its existing client base as part
ally was largely driven by internal col-
instead for RMs who believe in the
of the broader Group.
laboration. I dont think we are even close
banks risk appetite and why it has
to mining half of these untapped internal
changed. It doesnt want to populate
opportunities.
its private banking business with indi-
This is based on the viewpoint that more

and more clients are looking to work
viduals still of the mind-set where they
with one bank for all their corporate and
As Asias wealth grows so will the
believe they need to be everything to
private banking needs.
demand for the transfer of inter-gen-
every client.
54
Integrating your
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work with you through every phase of your business and
care for your results as a trusted partner and adviser as
though we are a part of your business.
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EVENT HIGHLIGHTS - INDEPENDENT WEALTH MANAGEMENT FORUM 2016 - MARCH
Independent firms can grab more

AUM, but growth hurdles remain
Sentiment among participants at Hubbis annual get-together for the independent wealth
community in Singapore in March showed the optimism for this industry segment to
become more prominent but only if it can engender enough client trust in the model
and lure more competent advisers from private banks.
Increasing awareness among HNW and
uncertainty; and the growing appeal of
UHNW clients of the added benefits of
access to alternatives not present within
an independent adviser especially
many bank offerings.
during market distress is a key factor

driving optimism among practitioners
At present, less than 5% of private
that this segment can control more
wealth AUM in Asia is overseen or
client assets and wield more influence
managed by independent firms. But in
amid an increasingly polarising land-
3 years time, two-thirds of speakers
scape within Asian wealth management.
and delegates from IAMs, MFOs,

other independent firms, and some
Independent asset managers (IAMs) and
private bankers predicted that
multi-family offices (MFOs) stand to
between 10% and 20% of this AUM will
benefit from a mix of dynamics playing
be with firms such as IAMs and MFOs.
out at the moment: growing client wariness and skepticism about the service
The main opportunities for these firms
and performance they get from their
were considered to be: capitalising on
private banks; a search by clients within
their flexibility; capturing clients unhappy
the current financial market turbulence
with the service and performance from
for models offering disruptive innova-
private banks; hiring private bankers and
tion combined with greater flexibility
advisers disgruntled with higher compli-
via a more tailored and relevant service;
ance scrutiny; consolidated and com-
a desire for genuine independent guid-
prehensive and unconflicted service;
ance to manage market volatility and
and flexible product range.

Asia Cornerstone
Leonteq Securities
Pershing
Henley & Partners
Heritage Trust Group
IRESS
AXA
EFA Group
Expersoft Systems
J O Hambro Capital
Management
Pictet
Swiss Asia
Thomson Reuters
Tikehau Investment
Management
VP Bank
Yet, the hard work is by no means over.

And a number of hurdles remain. The
top five challenges included: the compliance burden and keeping up with
change; acquiring clients and convincing them its worth paying a fee; being
able to attract enough talent (pay, commitment, prospects, etc); bank platforms DDC process; and raising sufficient AUM for economic viability.
56
Angelo Venardos
Anthonia Hui
Federico Donato
Filippo Fabbris
Liam Collins
AL Wealth Partners
FFA Asia
Oclaner Asset Management
PwC
Rashmi Lodha
Stirling R Larkin
Khing Go
Leonardo Drago
Olivier Destandau
Amicorp
Larkin Group
Marc Faber Group
AL Wealth Partners
EightStone
Patricia Thomas
Paul Gambles
Paul Hodes
Philipp Piaz
Rajini Kodialam
IRM Family Office
MBMG Group
Citibank
Finaport
Focus Financial Partners
Rohit Bhuta
Yash Mishra
Rolf Haudenschild
Shanker Iyer
Steve Brice
Crossinvest
Taurus Wealth Advisors
Maroon Analytics
Standard Chartered Private Bank.
Steve Davies
Suresh Withana
Ted Low
Steve Knabl
David Varley
Javelin Wealth Management
GAO Capital
Swiss Asia
AXA
57
Dominic Volek
Jeff Medina
Jessica Cutrera
Mark Nelligan
Matthew R Byer
Henley & Partners
Asia Cornerstone Asset Management
EXS Capital Asia
Pershing Securities
Spectrum
It is good to see this forum is growing

every year... and this year seems to be a
breakthrough in terms of the optimism for
this segment of the industry.
Urs Brutsch, Managing Partner & Founder, HP Wealth Management
Peter Williams
Urs Brutsch
Leonteq Securities
HP Wealth Management
58
INTERNATIONAL ASSETS
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TAX EFFICIENT STRUCTURING
MULTI - FAMILY OFFICE
ADVISORY & ADMINISTRATION
TRUSTS, FOUNDATIONS
& CORPORATE
REAL ESTATE & YACHT
OWNERSHIP & ADMINISTRATION
TAX, ESTATE
& RESIDENCE PLANNING
HONG KONG
SINGAPORE
MONACO
BVI
Contact: Peter Brigham
Email : p.brigham@rosemont.hk
www.rosemont-int.com
FIRM PROFILE
Focusing on what youre good at

As the fifth generation of the founders of Bordier & Cie, Evrard Bordier has a unique
perspective. And he is looking beyond shorter-term industry pressures to build a genuine
relationship-driven offering that dispels the myth that scale is critical for survival.
Evrard Bordier straddles two overlap-
ADAPTING TO THE MARKET
ping worlds: on one hand, he runs a
The first half of 2016 has been transfor-
private bank, trying to give his clients
mative for Bordier & Cie in many ways.
the best service he can; on the other,

he is the fifth-generation of a success-
From a reputational and regulatory
ful family business.
adherence point of view, the private

bank has a clean bill of health, and this
He balances the two as managing
is credited to the robustness of its op-
partner of Bordier & Cie a 170-plus
erational infrastructure.
year old independent, international

private bank.
Yet Bordier acknowledges the need to

regularly review the banks overall busi-
This also gives him a perspective where
ness strategy, especially against the
he can be pioneering in terms of devis-
backdrop of the regulatory, margin and
ing a new strategy to stay relevant and
other pressures he shares with his peers.
profitable as a boutique player in
This is always a potential consideration,
todays environment.
but what motivates me is the responsibility I feel to my ancestors to build the
We have gone past the point in this
best business we can, and one which will
industry where it is viable to run a small
stand the test of time, he explains.
EVRARD BORDIER
Bordier & Cie
business, says Bordier. It is no longer

enough for the middle and back office
He is also in quite a unique position
to keep pace with the scale of opera-
insofar as he is able to look beyond the
His relatively small scale also alleviates
tions. Banks today need enough infra-
short-term pressures of revenue targets
the need to rely on hiring hoards of new
structure to build the equivalent of a
that might influence the strategy of
bankers. Instead, he has the potential
20-storey building, regardless of size.
many publicly-held institutions.
to be opportunistic.
60
FIRM PROFILE
Plus, it is arguably too difficult to extract
that go beyond just managing their port-
the most successful relationship manag-
folios, adds Bordier. We take pride in
ers today, anyway.
executing a uniquely tailored touchpoint

strategy for each of our clients to bring
They tend to be financially-tied to their
the Bordier experience to life.
institutions, plus banks themselves have

become a lot more effective at retaining
These strategic brand touchpoints adapt
client assets, even when their top
to clients individual needs and lifestyle
bankers leave.
preferences. Enhancing the ambit of

our client servicing is an essential
The Bordier & Cie approach, therefore,
element to deepening our clients trust
is to have more of a business develop-
in us, he explains.
ment team. We try to go systematically through a particular country, one
In line with this, the firm is building its
at a time. We are redefining how we
repertoire of services that anticipate
approach the market, he says.
the need for a more involved wealth
We dont need to be good at everything, but only in one

or two specific areas which clients will come to us for.
DELIVERING VALUE
management approach. We think this
Going against the trend of standardi-
is something we can continue to excel
sation, Bordier says he wants to
in as long as we play to our boutique
provide a more tailored set of solu-
strengths, says Bordier.
Profit by partnerships
In trying to do things differently
to its competitors, and at the
same time play to the banks
strengths, Bordier believes in
partnerships as a key way to
secure new client assets and
grow profits in Asia, and without
raising fixed costs.
This is important to being able
to weather the expected trend
towards more onshore wealth
management going forward.
This poses a challenge to
boutiques like us, says Bordier.
Our model will never be geared
up towards having licences in
local markets.
So to capture onshore revenue
while remaining offshore, he
sees alliances as the main
avenue. The bank can charge for
sharing specialist knowledge
and training with institutions
which are building their private
banking offering. In return, it
hopes to be introduced to clients
who wish to bank in Singapore.
tions and services.

In his mind, this needs to go beyond
In finding the right model, as every bank
We want to be known in the market as
simply talking about protecting, preserv-
tries to pool its qualities, Bordier has
the best boutique bank, but with an of-
ing and passing wealth on to the next
opted for the relationship-based ap-
fering which is genuinely different, he
generation. Clients hear this from every
proach, not a performance one. We are
adds. We dont need to be good at ev-
private bank, and nobody stands out.
taking the right decision in moving this
erything, but only in one or two specific

areas which clients will come to us for.
way, and charging a fee for that.

As a result, he says clients often get
badly serviced, regardless of which bank
Likewise, the firm looks for clients who
they have an account with.
fit its business model and philosophy.
genuinely transformative in terms of
By contrast, Bordier is proud that the
Those who are willing to pay a premium
the banks approach to how it adds value
bank has retained what it calls its human
for proficient private banking are aware
to its clients.
dimension. This starts by having a frank
of what our advisory fee entails, says
and more realistic conversation with a
Bordier. Our ideal client values the work
Our relatively small size also means we
client about why they even want a bank
we do for them and is willing to pay what
are able to cater to clients specific needs
account in the first place.
we are worth for doing it.
However, this must involve more than

just marketing talk, and in its place be
62
FIRM PROFILE
Bank Vontobel eyes Asia with

offering of global access
Bank Vontobel is bullish on private banking in Asia despite the intense competition in
the region which has compressed margins. Georg Schubiger says the firms boutique
strategy allows a unique offering to HNW clients.
Being focused and targeted is a good
decision to basically operate as a wealth
thing in the Asian private banking in-
adviser to clients in the region, and book
dustry today.
their assets in Switzerland.
In an increasingly-tough environment
Such a narrow focus, it is becoming more
to even try to be all-things-to-all-peo-
and more relevant due to a combination
ple, downsizing, mergers, acquisitions
of market developments, as well as what
and exits have started to happen more
the bank believes entrepreneurs and
and more frequently.
wealthy families are increasingly looking

for, explains Schubiger.
But there is always scope for banks to

develop businesses where they offer
GROWTH AMBITION
clients something they really need.
As of 30 June 2016, Vontobel as a group

grew its net profit by 8% to CHF105.7
For Bank Vontobel, it is clear that the
million based on strong growth in new
firm looks for differentiation rather than
money of 7%, enabling advised client
scale. We have a boutique strategy
assets to reach a new level of CHF179.3
that focuses on clients who want to
billion (USD151.8 billion).
GEORG SCHUBIGER
Bank Vontobel
diversify part of their assets internationally across jurisdictions, asset classes
More specifically, in its wealth manage-
and currencies, says Georg Schubiger,
ment division, it was able to increase its
member of the group executive board
advised client assets to a new record
and head of private banking globally.
level of CHF43.3 billion. This was due
However, investments in the recruit-
to organic growth and the acquisition of
ment of additional client advisers, the
With a very lean set-up in Asia to offer
Finter Bank thus achieving above-
number of whom increased by 18% over
these services, the firm has taken the
average growth compared with its peers.
the last 12 months had an impact on
64
FIRM PROFILE
the overall positive result. At CHF34.2
form, where structured products of
million, pre-tax profit in wealth manage-
various providers are traded; these are
ment was higher than it was in the
also offered to private clients.
previous year.
In terms of asset management, meanYet the strong growth in the wealth and
while, some of Vontobels equity funds
asset management businesses over the
have posted above-average perfor-
last year resulted in significantly higher net
mance in recent years under US fund
fee and commission income, representing
manager Rajiv Jain.
66% of Vontobels operating income.

The bank can also offer a globally-diIn Asia, plans are afoot to increase the
versified, tailor-made portfolio to clients
impact of the region to the banks
with USD3 million in AUM and up.
Our ideal RM is somebody who understands the

investment world from a global diversified standpoint.
bottom-line. For example, it has a
In line with this, Schubiger says Bank
publicly-stated aim to place a focus on
Vontobel is more focused on bringing
emerging markets in Asia Pacific, to
on board advisers and wealth managers
strive to at least double its current busi-
who understand the clients they serve.
ness volume in the region by 2020.
Our ideal relationship manager (RM) is
Asian footprint expanding

While many Swiss private banks
run their Asian operations from
Singapore, Bank Vontobel has
chosen Hong Kong in which
to base its roughly 20-strong
private banking unit.
In early 2016, the firm boosted
its firepower on the relationship
management side, selectively
bringing in individuals with
the experience required to
implement Schubigers strategy.
For example, it hired Christine
Chen and Joannes Ho in March
and April respectively, both
from CTBC Bank, as senior
relationship managers in
newly-created roles.
As of June 2016, a new team
of experienced private banking
advisers has been in place in
Zurich, hired specifically to cater
to wealthy clients who
are domiciled in Australia.
somebody who understands the invest-
vices and products from Switzerland to
In line with this vision, the target for
ment world from a global diversified
Vontobels focus markets world-wide.
AUM in Asia (in wealth management)
standpoint, he explains. He or she
is to grow it by at least double over the
needs to have a broader view on the one
Also, in late 2015, it launched a secure
course of the next four years. Key to
hand, but also understand how entre-
mobile private banking app. This pro-
this for Bank Vontobel is emphasising
preneurs think. This enables them to get
vides HNW clients in China and Hong
its boutique strategy, which seeks to
a tailor-made service that takes into
Kong with around-the-clock access to
avoid having cost-intensive local
consideration the entrepreneurs needs
their portfolio and wealth management
booking centres.
in wealth planning and preservation.
services using smartphone and tablet

devices. Plus, it enables them to trade
RELEVANT SOLUTIONS
DIGITAL DIMENSION
and speak live to their RM through
As this family-owned firm continues to
Using technology to reach across borders
encrypted instant messaging.
try to distinguish its solutions for HNW
easier and quicker is a further important
clients, it puts value in being able to
component of Schubigers strategy.
importance of Bank Vontobel being at
benefit from its investment banking and

asset management arms.
While Schubiger acknowledges the
Although the bank doesnt believe that
the forefront of the digital revolution,
a digital interface can replace the face-
however, it must also distinguish what
In the case of investment banking, an
to-face interaction with an RM, technol-
will translate into an industry standard,
important focus is the Deritrade plat-
ogy has allowed it to export its ser-
and what will fall by the wayside.
66
BRITISH AND MALAYAN TRUSTEES LIMITED
Fiduciary Services for Families &

Financial Institutions since 1924
1 Coleman Street, #08-01, The Adelphi, Singapore 179803

Tel: 6535 4922 Fax: 6535 1258
www.bmtrust.com
EVENT HIGHLIGHTS - ASIAN WEALTH MANAGEMENT FORUM 2016 - SINGAPORE - MAY
Mapping out the future for

Asian wealth management
Our 7th annual event in Singapore for the regional wealth management industry brought
together 400 senior individuals from across the community to discuss and debate the
risks and opportunities ahead.
Despite Asias well-documented growth
example, over the last 24 months, the
in wealth, the time has come for a reality
focus was on trying to find solutions to
check. Only a small number of private
the lack of differentiation in strategies
banks are profitable and the industry is
and value propositions of many organ-
increasingly polarising; with the larger,
isations vying for market share. Further,
universal institutions on the one hand,
with insurance companies making a
and more focused boutique advisory
foray into wealth management in Asia,
firms at the other, making more
the landscape is changing quickly.
headway. A look at where the net new

money went over the previous 12 to 18
Going forward, individual players agreed
months has been clear evidence of this.
on the urgency to drive needs-based

conversations with the right clients,
Discussions focused on how to address
backed up by real advice and relevant,
industry shortcomings, such as business
contextual information.
models overly-reliant on transactional

revenue, continued challenges in raising
Local institutions onshore also need to
competency and productivity, onerous
seize their opportunity to position their
compliance obligations, and limited real
wealth management offerings as more
innovation or automation.
strategic within the wider group. This

is timely, as many foreign firms struggle
In the face of the growing pace of con-
with the demands of transparency and
solidation in Asian private banking, for
tax-related initiatives.
68


BNY Mellon
FactSet
Infosys Finacle
Intellect Design Arena
Leonteq Securities
Charles River
EY
Henley & Partners
Morningstar
Numerix
Vermilion Software
Aetna International
ASK Group
Aviva Investors
AXA
Domacom
Enhanced Investment Products
Friends Provident International
Fundinfo
Global Prime Partners
Investec Asset Management
J O Hambro
Orbium
Pershing
Quantifeed
Rosemont
SEI
Swiss Life
Swiss Asia
Synpulse
Thomson Reuters
Tikehau
Abhra Roy
Adriel Loh
R.N. Nagaraj Prasadh
Amar Bisht
Anurag Mahesh
Infosys Finacle
Bank of Singapore
Orbium
Deutsche Bank
Arthur Wu
Bassam Salem
Bruno de Pampelonne
Evrard Bordier
Febby Avianto
Morningstar
Citi Private Bank
Bordier & Cie
Falcon Private Bank
Oliver Lee
Gary Harvey
Jeroen Buwalda
Greg King
Frank Troise
Nexus Financial Services
EY
FactSet
Leonteq Securities
Toby Simpson
Philip Lung
Veronique Fournier
Jason Moo
John Cappetta
BNY Mellon Investment Management
Baring Asset Management
Goldman Sachs
Bank Julius Baer
Kevin Talbot
Koh Hoe Shin
Lim Say Boon
Mark Wightman
Markus Blattmann
Aviva Investors
Manulife Financial Advisers
DBS Bank
EY
Bank Julius Baer
69
Max Tiong
Ned Phillips
Nicholas Kourteff
Owen Young
Patrick Donaldson
DBS Bank
Bambu
UBS Wealth Management
Standard Chartered Bank
Thomson Reuters
Paul Gambles
Paul Hodes
Philipp Portmann
Ranjiv Raman
Rodolphe Larque
MBMG Group
Citibank
fundinfo
Cazenove Capital Management
Credit Suisse
Smita Choudhary
Stefan Kuhn
Steve Knabl
Erdem Ozgul
Alexis Tan
Bank of Singapore
Swiss Asia
Numerix
Henley & Partners Singapore
David Varley
Derek Goldberg
Dominic Volek
Seamus Donoghue
Hans Diederen
AXA
Aetna
Henley & Partners
Jaideep Billa
John Robson
Marcel Kreis
Mark Smallwood
Matthew Dabbs
Intellect Global Consumer Banking
Quantifeed
Hubbis
Deutsche Bank Wealth Management
AAM Advisory
70
SEALED WITH
TRUST
A HERITAGE
OF TRUST
At Asiaciti Trust, we understand the importance of delivering reliable, discreet, personalised
service. Place your trust in our 44 year record of adding long term value to clients wealth
preservation strategies. We are committed to serving the best interests of our clients, protecting
their assets and building a legacy for their families. Asiaciti Trust, a heritage of trust.
Trustee & Fiduciary Services International Tax Planning Wealth Protection Estate & Succession Planning Fund Administration International Company Services
Asiaciti Trust Singapore Pte Ltd
163 Penang Road, #02-03 Winsland House II, Singapore 238463

Tel: (65) 6533 2611 Fax: (65) 6305 0180 Email: Singapore@asiacititrust.com
Cook Islands Dubai Hong Kong
London Nevis New Zealand Panama

www.asiacititrust.com
Samoa
Singapore
EXPERT INSIGHTS
A need to be niche
To survive one of the most challenging periods private banking has ever faced, a more
focused and defined proposition is essential, says Brian Shegar of Emirates NBD.
A common concern among senior ex-
FACING UP TO CHANGE
ecutives in wealth management is the
Pressure is coming from multiple
gloomy outlook for the industry in Asia.
sources. Clients, too, have become more

and more demanding. They expect finer
They see it as one populated by increas-
pricing and lower transaction costs,
ing challenges from the many regula-
says Shegar. These challenges are not
tory obligations and compliance expec-
to be under-estimated.
tations, in turn requiring significant

investments in people and systems.
Plus, a few clients have been able to
With rising overheads from these and
successfully sue their private banks, so
efforts to tackle other business risks,
this places yet more emphasis for senior
private banks need to rapidly find a way
management on risk management and
to weather the storm.
operational efficiency.
According to Brian Shegar, head of Asia
In terms of the competitive environ-
Pacific for Emirates NBD, the right
ment, Shegar is also wary of what he
proposition for many institutions
calls the irreversible trend of fintechs.
without existing scale or size in this
Some institutions are trying to meet
space is to focus on what they can do
this challenge through collaboration and
best for their clients.
acquisition of fintechs. The banks which
BRIAN SHEGAR
Emirates NBD
are slow to adapt to this phenomena

A niche strategy works best, he ex-
could be bypassed in due course.
plains. Private banks shouldnt try to
the private wealth management space
do everything, or cover all markets.
Despite the need that will always exist
also suffering a certain amount of dis-
They need to focus on their compara-
for bespoke, tailor-made private banking
intermediation especially given the
tive advantage.
services, he foresees the potential for
threats that the banking industry is
72
EXPERT INSIGHTS
facing from robo-advisers and other
and commitment to continue to build
This is an evolution of Emirates NBDs
digital advice platforms.
out their wealth management offerings.
vision from the time of the opening of
SUSTAINABILITY IN QUESTION
A CLEAR STRATEGY
part of its strategy to play a pivotal role
Change is clearly underway within the
From Shegars perspective, this all works
in facilitating and catalysing trade and
private banking industry in Asia.
to the benefits of an institutions like
investment flows between Singapore
Emirates NBD.
and the Middle East, the bank aims to be
its Singapore branch in late 2010. As
a gateway for providing private banking
Many banks have rationalised their businesses, either down-sizing in some loca-
We have a differentiated strategy in
services to Middle Eastern HNWIs
tions, or pulling out of certain markets
Asia, which gives us a niche so that we
seeking to invest in Asia, and conversely
altogether, or even selling their busi-
dont have to compete with other
for Asian investors seeking investment
nesses entirely.
private banks, he explains.
opportunities in the Middle East.
It was inevitable that a shake-up in this
More specifically, the bank services the
The Singapore branch also leverages
industry would happen sooner rather
growing pool of money that gets in-
on the banks niche competence in
than later, says Shegar.
vested offshore from the GCC.
Shariah-compliant private banking and
The cost-income dynamics have
While this has traditionally gone to
become unattractive for many banks
Switzerland, or London, particularly for
ADAPTING THE ADVICE
not just their fixed costs, but also the
real estate investments, the bank is
The challenge of making money in
impact of getting caught out by making
increasingly seeing Singapore become
todays environment requires banks to
mistakes, he explains.
positioned as an attractive offshore
focus on how they can better harvest
asset management.
their clients to deepen and broaden

these relationships. For example, Asian
families are looking to further diversify,
protect and grow their wealth.
The cost-income dynamics have become

unattractive for many banks not just
their fixed costs, but also the impact of
getting caught out by making mistakes.
But with all jurisdictions under scrutiny,

some of the structures used in the past
are no longer viable. Plus, the potential
universe of clients in Asia is more limited
than before; any individuals which banks
now deem as questionable in terms of
source of wealth are untouchable.
As a result, to do well, he says manage-
investment centre for GCC clients. This
There is a lot of Chinese wealth, but
ment must have a granular focus on
is underpinned by Singapores world-
the challenge would be meeting the
costs and revenues.
class infrastructure and capabilities for
compliance requirements banks face
execution and advice across all asset
today in the onboarding process and
But the exit of some of the best-known
classes under the well-respected super-
managing this money, says Shegar.
brands from private banking in Asia in
visory regime of the MAS.

In general, wealthy Asian families also
the last few years, has raised questions

about how any of the smaller players
The banks relationship managers in
need to understand the rising demands
can make it work.
Dubai also play an important role, he
of global regulators and the impact of
adds. They try to help clients learn about
current and prospective regulatory
In Shegars view, this plays to the
opportunities to service offshore
reporting requirements such as FATCA,
strengths of regional banks with the size
wealth, but still keeping it with the bank.
CRS, etc, he adds.
74
Planning for your

future together
With roots dating to 1828, Willis Towers Watson is a leading global
advisory, broking and solutions company that helps clients around
the world turn risk into a path for growth.
Our Global Wealth Solutions team are here to learn everything about
our clients current situation and the goals they have set for themselves.
We believe in applying proven and practical experiences, backed by
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FIRM PROFILE
Steady growth with an eye to

the millennials
Vincent Chui of Morgan Stanley sees the challenges facing private banking as an
opportunity to selectively acquire talent and grow the platform to give it the right scale
and positioning especially with the next crop of Asians wealthy in mind.
Perhaps one of the more prudent ways
ably likely to pay off given that cyclical
to approach the current private
headwinds will stay strong for a while,
banking environment is to view 2016
adds Chui.
as a transitional year for industry

players to develop a rational view about
At the same time, it is hard to deny the
sizing and aspirations.
importance of scale. But it needs to

come via growth in the right way. Just
Being realistic is certainly a take-away
bringing in additional clients isnt neces-
for Vincent Chui, managing director and
sarily going to be most effective, cer-
head of Asia institutional equity distri-
tainly in comparison with additional
bution and private wealth management
revenue. You can sign up as many
at Morgan Stanley.
clients as you want, but ultimately in

this environment, most of them will
Private banking, notwithstanding its
probably be cautious, explains Chui.
secular growth, has been affected by

the very challenging investment and
Where there is a big opportunity and
low/negative interest rate environ-
one of the drivers for him to position-
ment, he says.
ing the private wealth proposition in
VINCENT CHUI
Morgan Stanley
this direction is to put in place the

It impacts both the flow and fees busi-
people, processes and infrastructure
ness, hence it is unrealistic for banks to
to attract and service the regions
manage their business using 2015 rev-
wealthiest millennials.
enues as a baseline.
manager. In Asia, its wealth manageTRADITIONAL STRENGTHS
ment business adopts a very differenti-
Whereas a few banks continue to seek
With AUM of around USD2 trillion,
ated approach, leveraging on its synergy
to add headcount, patience is prob-
Morgan Stanley is the biggest US wealth
with the firms top-ranked institutional
76
FIRM PROFILE
securities and investment banking fran-
investors. And he knows that wooing
This is a challenge for the industry as a
chise and connectivity.
these individuals requires the firm to
whole, not just for Morgan Stanley.
adapt its approach.

Private clients benefit from that sig-
The key thing, however, is to make a start
nificantly in terms of investment ideas,
More specifically, this involves bringing
along this path by investing in and sup-
research and products, he adds.
on board relationship managers (RMs)
porting younger RMs.
who are more aligned in their thinking.

Chui believes that the bank has an im-
On the flipside, the bank has deliberately chosen not to be aggressive in
Plus, they need to talk to these clients
portant advantage in the current set-up
terms of lending on a stand-alone basis.
about a wider set of solutions to meet
in which he operates: with a crop of
Saying that, it does use lending as a tool
a broader variety of needs and goals.
high-quality and well-experienced RMs
to try to help its clients achieve their
who, on average, have 10 years-plus at
goals in terms of hedging or investment,
The reality is, this next generation of
as part of a more holistic approach.
potential clients is not going to spend
As with its peers, the bank has found the
Morgan Stanley.
all their time thinking about invest-
This is in line with the strategy that he
ments, explains Chui.
and his fellow senior management have
investment conversation with clients to
on productivity.
be a more challenging one over the past
Instead, they are much more likely to
12 months, and especially in 2016.
seek investment opportunity in a tech
Our model focuses on delivering top
start-up, conscious of their investments
quartile revenue per head, hence the
environmental impact, and having more
importance of bringing in and retaining
The risk-reward is different this year

versus the last two years, so any product
that gives you low volatility and reasonable risk-adjusted returns is worth
looking at, explains Chui.
As a result, cross-asset product which
generates a reasonable yield, such as
4% to 5%, is in demand, as long as there
is a demonstrable track record and
Our model focuses on delivering top-quartile revenue

per head, hence the importance of bringing in and
retaining experienced RMs and product talent.
limited drawdown. Cash-equivalent

products like money market funds and
certificates of deposit are also highlysought after.
This is where it is essential to take a longer
work-life balance. And the mechanisms
experienced RMs and product talent,
term view, he adds. These types of prod-
for delivering advice are different too.
he explains.
asset management company or distribu-
A younger generation of RMs is there-
Whereas Morgan Stanleys Asia wealth
tor, but to me its part of the service, and
fore required to meet these needs, start-
business is estimated to be managing as
at a time when clients need advisers to
ing with advisers developing the right
much as USD60 billion, it is notable that
help them take care of the problem of
connectivity and better understand ing
its team of a hundred RMs is small
having too much cash.
of how these clients think.
among banks with similar AUM.
AN EYE ON WHATS NEXT
Then, when this new generation takes
This is a crowded industry but if we
Where Chui does believe the bank can
over or starts to share responsibility
segment appropriately and execute well
also make a mark, is in advising the next
with the first generation, we are already
with the right talent, it is a very good
generation of Asias HNW and UHNW
speaking their language, adds Chui.
business, adds Chui.
ucts are not very profitable for either the
78
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FIRM PROFILE
Investec strives to set new

advisory tone in Hong Kong
A focus on service-led, discretionary investment portfolios for a targeted group of clients
should enable Investec Wealth & Investment to articulate why and how it has something of
value to offer. This is the strategy Catherine Kirchmann is spearheading.
As the new kid on the block in Asian
More specifically, says Kirchmann, divi-
private wealth management, Investec
sional director and responsible for In-
Wealth & Investment has a clear strat-
vestecs Wealth & Investment business
egy that it believes will enable it to
in Hong Kong, the goal is to offer
weather one of the most challenging
bespoke investment management ser-
landscapes in recent memory.
vices to affluent Chinese and expatriates

in Hong Kong.
In addition to volatile financial markets,

a number of players in the industry are
She is well-placed with her background
also exiting this space, given the various
to oversee this. For instance, her exper-
pressures from regulation, margin com-
tise lies in providing discretionary and
pression and competition.
advisory investment services to professional investors, including HNW indi-
Yet the Investec Group didnt rush its
viduals, charities, trusts, companies and
decision to open its new business in Asia.
clients of financial advisers. The focus

is very much on service rather than
As an organisation, it tends to leverage
product. We dont believe in putting
where it has existing infrastructure, so
clients in pre-determined boxes or pro-
had comfort from its asset management
moting off the shelf solutions.
CATHERINE KIRCHMANN
Investec Wealth & Investment
presence in the region dating back to

the late 1990s.
SETTING THE TONE

Many of the firms clients in the UK and
Plus, Catherine Kirchmann says the firm
Europe, as well as in South Africa, who
Now it needs to be transferred to Asia
has a very focused strategy in line with
are in some cases loyal for over 20
something Kirchmann is confident
the wider Investec Groups plans to
years, will testify to the firms client-
about. With our strong track record,
expand the division internationally.
centric approach.
tailored and flexible approach to manag-
80
FIRM PROFILE
ing portfolios, and the access our clients
and they want to speak to individuals
have to experienced and skilled invest-
who can have an in-depth conversation
ment managers, we are well-suited to
about markets, asset allocation and
the unique needs of the Chinese and
portfolio construction.
expatriate markets in Hong Kong.

So while there will still be a large number
In particular, the people clients speak
of wealthy individuals who will opt for
to are the investment managers, so can
an advisory model, she sees there being
give much more specific information
a growing opportunity for the discre-
about the portfolio. This also avoids the
tionary approach.
all-too-common disconnect in some

other firms which happens between the
MEASURED GROWTH
client and investment team sitting in the
For the time being, the focus for Kirch-
background without really understand-
mann is Hong Kong, although she says
ing the clients investment objectives
that she wouldnt rule out expanding
and needs.
into other markets in Asia further down

the track.
The evolving demographics in Hong

Kong also offer Investec reason for op-
We have only just begun here, she says.
timism. Not only are there growing af-
We got the go-ahead from the SFC in
fluent and HNW populations, but they
November 2015, but we officially
are also getting younger.
launched the business in April 2016. We

have started to gain some good momen-
As wealth passes down from first to
tum, taking on a number of new clients.
second generation, and from second to

third generation, people take longer-
One of the inevitable challenges she
term views in terms of wealth manage-
shares with her peers is finding the right
ment, says Kirchmann.
people to join the team a potential

stunt to growth.
Meanwhile, the firm is also bringing a

less-trodden fee structure to Asia.
But the shortage is a slightly more difficult one to fill in Investecs case.
It charges clients an all-in management

fee. This is important in a market where
We are not just relationship managers,
people are so focused on commission
explains Kirchmann.
and brokerage, adds Kirchmann. But

we believe that fees should be as trans-
We look for people who have got the
parent as possible.
depth of experience in investment

markets, she adds, because what does
Ultimately, she predicts investors in Asia
differentiate us from many of our com-
will become more demanding when it
petitors nowadays is the fact that the
comes to the quality of advice.
person you are speaking to is the person
Dedicated investment
process
To support its value proposition,
Investec has invested heavily
in a dedicated central research
function for its Wealth &
Investment business.
This consists of an experienced
team of analysts covering a
wide range of equities, fixed
income and collective investment
opportunities.
The research team is fully
independent of the wider
Investec Group, but benefits
from a collaboration of thoughts
and processes.
The process it follows is a
disciplined and consistent
one, with the sole purpose
of supporting the divisions
investment managers in
three core areas: asset
allocation, equity strategy
and collective funds
At this point in time, the Hong
Kong division offers international
and diversified portfolios.
When it comes to developed
markets, Investec Wealth &
Investment provides single-line
stocks and bonds, whereas in
developing markets, it uses
mutual funds, but within an
open architecture platform.
We are best-of-breed rather
than best-of-brand, explains
Kirchmann.
managing your portfolio, not just

When people are focusing on what
handing it back to a team or putting it
they are paying in fees, they want to
in a model portfolio.
get something for their money, she
a positive development in her eyes. We

see an opportunity in this because
explains, to the extent that they want
In fact, the outflow of some private
there are some very good people in
their investments properly managed
wealth management firms from Asia is
these organisations.
82
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EVENT HIGHLIGHTS - WEALTH THINK 2016 - JUNE
Rethinking business models in

Asian wealth management
Speaking at Wealth THINK 2016 in Hong Kong, leading practitioners within Asian
wealth management explored some of the key themes shaping the look-and-feel for the
industry going forward as organisations rethink business models and re-define their
value propositions.
In a tough year for the wealth manage-
need to be able to deal with the cost
ment industry, chief executives and
and regulatory pressures they face.
other banking leaders are reconsidering

their business models, along with the
Yet there is competition also coming
strategic choices they need to make, to
from different segments and types of
remain relevant in Asia.
organisations within the wealth man-
Thank you to our

exclusive sponsor

Thomson Reuters
agement industry.
At the same time, they are looking at
how they can take advantage of the
In terms of China, many practitioners
opportunities relating to China, includ-
believe that this market will be the
ing the offshoring and onshoring of
driver for the industry over the coming
Chinese wealth.
decade, yet it is also a slowly-developing one.
In line with this, we designed and

hosted our first Hong Kong-based
A lot of conversations at the moment
summit, in June 2016, for leaders from
among industry leaders revolve around
Asia and globally.
efficiency and enabling relationship

managers (RMs) to do more.
For private banks, in particular, they

need to determine how to build a sus-
This involves digital capabilities in order
tainable platform for the future. In ad-
to help them to generate revenue op-
dition to having to increase scale, they
portunities rather than spending their
time on more administrative tasks, or

doing research.
This wont change the fact of challenging market conditions, but it can help
to make these individuals more productive in the meantime.
Meanwhile, the desire to develop more
needs-based solutions for clients in Asia
is a process which will take time
perhaps another five to 10 years according to some estimates.
In practice, in the current environment,
advisers need to focus on clients existing portfolios, rather than continue to
try to engage clients with new ideas. In
line with this, the banks must also adapt
their incentive structures, to think
longer term.
That will finally drive the change in
thinking needed to lead to a new business model for wealth management
in Asia.
84
Alan Armitage
Alan Luk
Alvin Ma
Bassam Salem
Bobby Bok
Standard Life (Asia) Limited
Hang Seng Bank
EFG Bank
Citi Private Bank
Thomson Reuters
Eddy Wong
Eleanor Wan
Piers Brunner
Robert Rooks
Howard Bilton
J.P. Morgan Asset Management
Knight Frank
Deloitte
The Sovereign Group
Peter McMillan
Janet Chong
Jonathan Ha
Joseph Tam
Jung Ho Rhee
Thomson Reuters
DBS Bank
Red Pulse
Wing Lung Bank
Mirae Asset Global Investments (HK)
Ken Tam
Kevin Lee
Martin Crawford
Michael Blake
Michael Olesnicky
RBC Global Asset Management
Zhong Lun Law Firm
Vistra Group
Union Bancaire Privee
KPMG
Neil Harvey
Nigel Rivers
Roger Steel
Ron Lee
Rosita Lee
Credit Suisse
Capital Solutions
Sun Life Financial
Goldman Sachs
Hang Seng Bank
85
Stewart Aldcroft
TF Cheng
Thomas Young
Thusitha de Silva
Timothy Lo
Citi
BNP Paribas Investment Partners
Generali
Cerulli Associates
CIC Investor Services
Xiaofeng Zhong
Alexandre Viale
Henry Fu
Peter McMillan
Philippe Legrand
Amundi
EY
Thomson Reuters
Thomson Reuters
86
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87
CO-PUBLISHED ARTICLE
Regulatory change management for

investment suitability and beyond
It may come as no surprise that in spite of turbulent financial markets, most global and
local private banks in Asia are continuing to invest heavily in their operations in order
to keep pace with the agility needed to service the growing market of Asian multimillionaires. By Prasanna Venkatesan of Synpulse.
As digitally-savvy and wealthy custom-
these suitability requirements. However,
ers look out for more sophisticated
these solutions have resulted in added
engagement via online channels, banks
administrative overheads to their rela-
also strive to find smarter ways to on-
tionship managers (RMs)and created
board these new channels and scale
complex control structures that are
them across markets while being com-
heavily-scrutinised during regulatory
pliant. Although banks show the willing-
reviews.
ness to embrace such changes, they are

limited by their internal inefficiencies
TACKLING INVESTMENT
and less-than-agile IT infrastructure.
SUITABILITY CHALLENGES
Implementing a suitability framework
Of the many regulatory topics that
in a pragmatic way requires deep un-
continue to challenge banks, invest-
derstanding of the private banking in-
ment suitability has been one of the
dustry in terms of regulatory require-
key topics that most banks struggle to
ments, clients, investment products and
handle effectively.
risk management.
Although practices for careful advice
There are three key steps to implement-
were known in the market for years,
ing a robust suitability framework:
PRASANNA VENKATESAN
Synpulse
regulators in Hong Kong and Singapore

started issuing many clear directives on
Formulate a pragmatic portfolio
suitability standards after the financial
approach to ensure that clients
crisis in 2008.
investments are assessed at port-
Implement pre-trade checks in the
folio level instead of a transaction
order management system in a way
In the last few years, many banks have
level, making it more meaningful
that the RMs only need to focus on
resorted to tactical solutions to address
in a private banking set-up
failed suitability checks and follow
88
Source: MAS and HKMA Suitability Requirements on a timeline
the clear recommended actions
change management process and IT
In spite of these large investments, most
presented via a unified dashboard
infrastructure present.
of the private banking businesses even
Devise a periodic portfolio moni-
This takes us towards concept of digi-
toring mechanism to ensure that
talisation and organisation agility where
the clients portfolios are moni-
the industry needs to identify efficient
First, there are still a lot of administra-
tored to detect unusual portfolio
ways of conducting business which
tive overheads that the RMs and the
performance, risk mismatch, con-
extends towards the space of regula-
clients face due to ineffective ways of
centration risks etc in order to
tory and compliance topics.
implementing regulations that many
today face formidable challenges based

address suitability risk in a proac-
on two aspects.
times ignore the business context of

THE RULE ENGINE SOLUTION:
private banking. This results in frus-
STRATEGIC PERSPECTIVE
trated RMs, unhappy clients and poor-
The majority of the large banks in the
Traditionally banks have been big part
ly-implemented control processes that
region have a good understanding on
of their change budget to implement
are heavily-scrutinised by regulators.
the principles of a successful suitability
the regulatory requirements (especially
framework. However, they seem to be
suitability) and the corresponding
Secondly, decentralised IT implementa-
constrained with the challenges that IT
control processes to ensure compliance.
tions spanning across multiple core
tive and timely manner
Source: Key steps in implementing a robust suitability framework
89
CO-PUBLISHED ARTICLE
banking components are too cumber-
This significantly brings down the cost
Given the rapid increase in clients
some and costly to maintain. This results
and time to market for new channel or
demand for digital channels that are
in a less agile IT infrastructure that pre-
new booking centre integration.
accessible across the globe, there comes
vents scalability of regulatory implementations across geographies or channels.
a strong need to explore strategic ways

The central maintenance of rules
of implementing regulations across dif-
become paramount as regulators across
ferent jurisdictions.
A central rule engine to develop and
different jurisdictions are coming in with
maintain the rules will not only allow
aligned practices. Even in cases of BCBS
Banks that head down this path will
ease of maintenance and future scal-
239 and CRS (FATCA/AEI) require-
definitely have an edge over the others
ability but also enable central control
ments, the rule engine allows central
in gaining strategic market advantage.
and management of regulatory rules
pooling of data and managing output
The advantage and agility is even more
and internal controls.
in a bespoke way. A regulatory change
needed for the mid-sized private banks
needs to be implemented only in one
in order to be able increase their effi-
As such, the rule engine is designed only
place and standard practices are avail-
ciency of conducting business by adopt-
to maintain the business logic relevant
able across different channels and
ing digitalisation in relevant regulatory
to regulatory checks and envelopes
booking centres.
and compliance topics.
systems. This architecture facilitates
There are already established technology
With our many years of experiences in
aggregation of relevant client, product
products in the market that allow such
shaping the topics on regulatory and
and portfolio information before the
change agility that the banks could lever-
compliance, Synpulse has developed
business logic can be executed.
age. One of the products even offers
and showcased specialised skills in this
around the existing core banking
visually-customisable capabilities where
area. Backed by both business and tech-
Such an implementation would enable
a business user can directly adapt many
nology solution expertise, Synpulse is
other digital channels and different
configurations (for example, product
well-positioned to offer its support to
booking centres to connect to the rule
scope) and simple business logic which
clients in streamlining their regulatory
engine and start leveraging the cen-
makes the change even more efficient
implementations in an effective and
trally developed regulatory rules.
and controllable directly by business.
meaningful way.
Source: Central rule engine that facilitates ease of implementation and scalability across channels and booking centres
90
From Prospecting to Onboarding and Servicing

Ensured & automated Risk and Compliance
(KYC, Suitability, FATCA, CRS, MiFID, etc.)
Getting your Digital Bank ready
EXPERT INSIGHTS
How BEA is eyeing China for

wealth management growth
The growth of The Bank of East Asia (BEAs) wealth management business is being
fueled by opportunities in China, says Grace Chow.
Despite the challenging business envi-
general manager and head of the banks
ronment in 2015, BEA reported sus-
wealth management division.
tained growth in wealth management,

largely as the bank has focused on
With branches and sub-branches cov-
growth in China.
ering 44 cities on the Mainland, BEAs
We have been trying to refer clients within our

organisation as much as possible. We are now looking
at whether its possible for us to expand our
onshore services via our Mainland subsidiary,
BEA China, to help clients manage their
onshore and offshore funds.
GRACE CHOW
Bank of East Asia
An important factor in its success during
network is second only to HSBCs
more difficult markets has been the
among the foreign banks. This has
increasing number of Mainland-based
banks extensive branch network in
enabled BEA to generate business for
entrepreneurs are conducting their
Mainland China, says Grace Chow,
its private banking division since an
business abroad.
92
CHASING THE CHINA OPPORTUNITY
try players, the possibility of a robo-
petency in the technical as well as in
Chow says that China remains a key part
type RM is not something that Chow
the ethical and compliance areas for
of the growth strategy for her division,
thinks is relevant for private banking
private banking practitioners.
despite the challenges for her industry
in this instance.
But she also believes that practical
and the broader market in 2016.

Private banking, she explains, is still
knowledge is equally important to a
With current market sentiment, clients
about a personal relationship and a
private banker to serve clients.
are unwilling to take risks and would
tailor-made solution for clients, and
rather sacrifice yields and returns. In
robots may not easily take up the job,
The account-opening process is another
addition, clients are not so comfortable
at least for some time.
example where requirements are more
buying stocks, she explains.
stringent than in the past.

INCREASINGLY STRINGENT
We have not seen such risk-averse
REGULATIONS
For instance, while a private banking
sentiment for quite a number of years,
Operating within an increasingly
account can be opened as quickly as
she adds.
complex regulatory framework, some
within one to two weeks, it is quite
private banking practitioners are con-
common for the process to take three
cerned that the stringent regulatory
to six months.
Given the lack of trading in todays environment, which in the past has played
to the strengths of BEAs wealth management platform, the bank has been
looking into offering more stable products for a clients longer-term holdings.
The focus on China, therefore, continues to be strong, with the aim to attract
assets from wealthy individuals as
Chow believes this is where the bank
While Hong Kongs wealth management

business has its advantages, it needs to ensure
that it stays competitive and facilitates business
by being both professional and practical.
has a competitive edge for the foreseeable future.

We have been trying to refer clients
within our organisation as much as pos-
environment can create headwinds for
Such evidence reflects the direction of
sible, she says. We are now looking at
the industry.
the regulatory environment today.
our onshore services via our Mainland
For example, in Hong Kong, recently-
And this means that private banking is
subsidiary, BEA China, to help clients
introduced exams as part of the joint
now less about sitting across the table
manage their onshore and offshore
government and industry-led certifica-
to reason out rules, and instead more
funds, she adds.
tion scheme to implement the En-
about sticking to the letter of the
hanced Competency Framework do
various ordinances.
whether its possible for us to expand
EXPERIENCE COUNTS
not factor in the value of an RMs ex-
Developing these types of relationships
perience as much as they should, ac-
Nowadays, we just have to follow the
will inevitably be done face-to-face,
cording to some practitioners.
rules, explains Chow.
phasis on relationship managers (RMs)
Fresh recruits who study hard seem to
While Hong Kongs wealth manage-
with experience.
be performing much better than those
ment business has its advantages, it
who have been in the industry for 10
needs to ensure that it stays competi-
Although digitalisation and automa-
or 15 years. Chow agrees with the ob-
tive and facilitates business by being
tion are in the works of all the indus-
jectives of an enhanced level of com-
both professional and practical.
highlighting the importance of the em-
93
EVENT HIGHLIGHTS - MIDDLE EAST WEALTH MANAGEMENT FORUM 2016 - FEBRUARY
Enhancing capability, capacity

and pipeline in the Middle East
Our inaugural event for the local wealth management industry in the Middle East,
hosted in Dubai in January 2016, highlighted key ways that the industry needs to
develop to move to the next level.
There is little doubt about the poten-
from people capable and competent
tial for wealth management and
to do so. This will also help to remove
private banking in the Middle East.
confusion between what is retail/af-
Statistics from various industry reports
fluent banking versus private banking,
highlight growth especially the fact
said speakers.
that a large proportion is from newlycreated wealth.
From diversification to wealth structuring to client education to higher
At the same time, Islamic finance has
standards of professionalism, there-
proven its resilience against economic
fore, organisations need to position
headwinds is on a constant growth path.
their businesses in line with the op-
Dubai, in particular, is also well-posi-
portunities that exist, and define clear
tioned to tap frontier markets around
value propositions. This also includes
the region.
reducing the dependence on oil and its

Emirates NBD
Amicorp Group
Comarch
FinIQ
Jersey Finance
Miles Software
Profile Software
Old Mutual International
Thomson Reuters
price fluctuations, which has an impact

Yet practitioners at the event high-
on the fiscal situation of the various
lighted that there is still a lot to do to
GCC countries.
remains a challenge. And ensuring the
At a business level, finding the right
key to maintaining a compliant and
develop the regions and wealth management industry.
model that is suited to the most lucraAt a client service level, a big focus
tive client segments not just today,
must be delivering the right advice
but more importantly tomorrow
right types of clients are on-boarded is

viable proposition.
Further, there is a lot more to be done
within local financial institutions to
position their wealth management offerings as more strategic within the
wider group. This includes investing
sufficiently in the technology, platforms
and overall infrastructure.
At a regional level, meanwhile, there is
a need for regulators to be more joined
up, to provide clarity on cross-border
practices/activities and remove reliance
on tolerated practices.
94
Ahmad Chahidi
Akash Anand
Alastair Glover
Andrew Mortimer
Andrew Prince
Emirates NBD Private Banking
Profile Software
Wragge Lawrence Graham & Co
Barclays
Acuma
Anthony Jaganathan
Brendan Dolan
Damian Hitchen
David Marshall
Deepak Ahuja
Emirates NBD
Swissquote Bank
Emirates NBD
RAKBANK
Deepak Mehra
Dr Haroun Dharsey
Fadi Al Said
Fiona McClafferty
Gary Dugan
Commercial Bank of Dubai
Dubai Islamic Bank
Lazard Asset Management
Deloitte
Emirates NBD
Gary Hales
Gary Tiernan
George Triplow
Gifford Nakajima
Hans Goetti
Ernst & Young
HSBC
Banque Internationale A Luxembourg
Jersey Finance
Karima Abdesslami
Karine Kheirallah
Kees Stoute
Lina Taher
Georg Hartmann
National Bank of Abu Dhabi
Falcon Private Bank
Hubbis
Liechtensteinische Landesbank
95
Maya Marissa Malek
Mihaela Moldoveanu
Milan Ganatra
Walter Jopp
Peter Golovsky
Amanie Advisors
DIFC Wills and Probate Registry
Miles Software Solutions
Zurich International Life
Amicorp Group
Rajesh Khanna
Sean Kelleher
Subroto Som
Tom Anderson
Vic Malik
Emirates NBD
Mondial Dubai
Mashreq Bank
Killik
Barclays
Yann Mrazek
Luke Janssen
Mahesh Bulchandani
Tim Searle
Greg Prosowicz, PhD
M/Advocates of Law
Tigerspike
FinIQ
Globaleye
Comarch
There isnt such an event that exists in the

wealth management space in this part of the
world. This is a great initiative.
Nayeem Khan, Chief Operating Officer, Qatar First Bank
Sandeep Lalwani
Nayeem Khan
Qatar First Bank
96
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FIRM PROFILE
Driving an all-round Indian

proposition for high-end clients
Edelweiss Global Wealth Management has shunned the oft-trodden route in India of pushing
product, trying instead to provide real solutions to targeted groups of HNW and UHNW
individuals. Anshu Kapoor explains the benefits this is bringing to the firm and its clients.
A growing number of wealth manage-
CLIENT FOCUS PAYS OFF
ment players in India especially the
The firms strategy has been simple: to
foreign private banks are seeing mixed
be completely focused on its clients.
results (at best) within their businesses
We dont look at it from an output
as the cost, regulatory and competitive
perspective; we think much more from
challenges have mounted.
an input perspective, explains Kapoor.
But in what is an increasingly polarising
Carefully selecting its client segments
industry as a result, Edelweiss believes
to target is a key component of the
it is bucking the trend.
Edelweiss approach. For example, on

the UHNI side, it exclusively caters to
For example, explains Anshu Kapoor,
new-generation and next-generation
the firms head of global wealth man-
entrepreneurs, rather than servicing any
agement, 2015 was a good year overall
old wealth.
for the firm across both wealth and

asset management.
The firm also has a group which caters

to family offices and what it refers to
ANSHU KAPOOR
Edelweiss
Today, AUM across the two businesses
as institutional clients. Within the family
stands at the equivalent of around
office client base, it further divides the
USD9 billion, split roughly evenly.
market into evolving and evolved.
We have reached critical mass now,
An additional business line provides
says Kapoor. I think we are number
financing in relation to employee stock
lending money against the shares that
three today, by any measure, in the
ownership plans (ESOPs), which the
staff own (or will own in the future), plus
Indian market for serving both HNI and
firm sees as a large and growing cate-
hedging the exposure and managing
UHNI clients.
gory. This involves a combination of
the concentration.
98
A lot of other wealth managers only do
For example, on the real estate side, the
investment management, explains
firm co-partners with clients in dis-
Kapoor. Within our client segments,
tressed deals, as well as buying inven-
we are focused on their needs, so we
tory and underwriting for commercial
have built our value proposition and
and pre-leased properties.
teams accordingly.
At the same time, Kapoor says the firm
For instance, in the family office group,
is very focused on building up its invest-
clients get serviced by a mix of former
ment platform, especially since this is
traders, investment bankers and insti-
not something which can be easily
tutional salespeople. This creates a
replicated. The rationale is, that in ad-
different kind of team, which is able to
dition to be able to provide products
deliver the solutions that clients need,
via the platform such as structured
he adds, whether this is capital, advi-
investments, this also gives the firm
sory, investment, leverage or tax struc-
certain capabilities to service the client.
turing and planning.

FINDING THE RIGHT TALENT
Perhaps the most tangible example of
Despite the opportunities and market
the client focus that Kapoor is keen to
potential, one of the drags on growth
highlight is the fact that the firm invites
in Indian wealth management continues
clients to some its own sales meetings.
to be the availability of talent.
There are two clients on our real estate

advisory board, he says. They help us
Yet Kapoor says Edelweiss wont com-
select real estate projects to be offered
promise. We have an internal policy
to other clients.
that we only hire what we consider to

be A-raters.
THE RIGHT PACKAGING
Becoming digitally-enabled
Acknowledging the importance
of digital, Edelweiss has forged a
partnership with IBM to build a
digital infrastructure.
On the wealth management
side, this involves some big
investments, says Kapoor.
Salesforce is an example of
whats currently being
implemented in terms of
customer relationship
management.
In addition, to stave off the threat
from robo-advisors, the firm is in
the process of building a simple
online tool which its clients can
use to invest.
This highlights more broadly the
role that Kapoor sees technology
playing as part of the interface
with clients ranging from
digitising account opening to
transaction processing.
A challenge for any wealth management
Such an individual needs to pass a series
firm in India stems from the market
of tests. This starts with product, then
continuing to be characterised as rela-
includes an MBA-like analytical test and
tively short on product, yet long on
a psychometric evaluation. Beyond its
KEEPING IT LOCAL
product pushing.
focus on the quality of intake, the firm
Notable about Indias wealth manage-
then trains and grooms these people
ment landscape over the past 12 to 18
So standing out requires a different ap-
over time.
packaging a solution.
months has been the fact that some of

the foreign players have been unable
proach one which is more about

The reward for those who get through
to grow their operations.
the door is an environment of zero

We help our clients to spot opportuni-
politics and opportunity for growth.
Yet addressing some of the key chal-
ties and trends, and be protected from
We give our people the canvas to paint
lenges in terms of capacity and capabil-
risks, explains Kapoor.
on, says Kapoor. To us it is not impor-
ity, and being able to scale the business,
tant what someone has done before; it
starts by ensuring that it caters to the
With a vigilant regulator which tries to
is what they want to do in life which is
needs of the local market.
prevent any kind of over-complication
more important.
India is an onshore-only market, very
or complexity in the product offering

for investors, Edelweiss approach is to
Reflecting the ownership and incenti-
much like the US, explains Kapoor. So
agree an asset allocation with a client
visation structure of the firm, its em-
no player, whether foreign or local, can
and then be smart and nimble in creat-
ployees and founders own a combined
work on an imported wealth manage-
ing opportunities.
55% of Edelweiss.
ment model.
99
EXPERT INSIGHTS
The components of a successful

wealth offering in India
Many firms have tried and failed to tap the assets of Indias wealthiest citizens. Karan
Bhagat believes that IIFL Private Wealth Management has devised a successful strategy
based on the right blend of people, product and platforms.
IIFL Private Wealth Management was
Private Wealth Management, this is a
borne out of the vision of a group of
particularly attractive segment.
senior professionals with significant

private banking experience who, at the
In India, fixed income taxation only
height of global financial turmoil in
reaches zero after the investor holds it
2008, took a decision to join forces with
for three years, so if clients have liquid-
India Infoline Group.
ity needs they can draw against the

portfolio. In India, many people invest
Since then, being more focused on ad-
their own money but they want a credit
visory than distribution has enabled the
line against it, he explains.
firm to develop a sustainable business

model that offers a high level of trans-
A WINNING MATRIX
parency and has been able to engender
To create the right mind-set and culture,
client loyalty.
the firms 90 or so employees now own

33% of the business, which has kept
More recently, IIFL Private Wealth Man-
attrition low as staff feel more commit-
agement has been in fundraising mode,
ted. That is the people component.
with the majority of the funds raised

earmarked for reinvestment, particu-
In terms of products, there is a need to
larly in non-banking finance. In Febru-
be continually innovative while achiev-
ary, for example, it acquired non-bank-
ing a standardisation in the offering.
KARAN BHAGAT
IIFL Private Wealth Management
ing finance company (NBFC) Chephis

Capital Markets.
Even though most of the business in
As for the platform, there are a number
India and Asia is non-discretionary, the
of elements without which a firm cannot
For Karan Bhagat, managing director
majority of the client portfolios have a
survive, he adds. Obviously one is the
and chief executive officer of IIFL
similar product profile, explains Bhagat.
NBFC aspect of the business for client
100
finance, but you also need a very solid
have moved the money that it manages
technology platform, as well as a good
today from other advisers because he
equity brokerage set-up and research.
believes that it would have taken way

too long to do so.
With this in mind, Bhagat attributes the

struggle of many wealth management
EVOLVING THE CONCEPT OF ADVICE
firms in India to the ability of getting
Bhagat describes the introduction of
the three components of products,
advisory guidelines in India as a major
platform and people right.
step forward in the development of the

countrys wealth management sector.
As time goes along it will only become

difficult because investment required
This has the power to consolidate, to
in these three facets will only be higher
look at all holdings under one umbrella
and retention ratios on assets will only
and deal with multiple advisers through
be declining.
the custodian account as opposed to
The advisory model is challenged by the commercial

reality of the business.
Digital demands
There is little doubt that while
digital technology will improve
adviser effectiveness along with
the client experience, userled dashboards will change as
platforms evolve and new ones are
developed. In turn, this will make a
big impact in terms of aggregation
of data.
The outlook for robo-advisers,
meanwhile, is less rosy among
HNW clients. Dealing mainly with
very simple products and ETFs,
Bhagat says that robo-advisers
have generally performed poorly
compared with actively managed
funds. Over the last 10 years,
active managers have consistently
beaten the index by a big margin.
Plus, given the way the regulations are,

an advisers ability to earn any kind of
NEW PROSPECTS
individual segregated depository ac-
The fact that many older entrepreneurs
counts with multiple brokers.
in India have exited businesses has
commission is effectively zero.

In the interim, Bhagat says flow is more
created a pool of money that remains
Such reforms, driven by the Securities
important than transaction fee income.
available for investment. We also have
and Exchange Board of India (SEBI),
We are not worried about earning a
professionals who are selling stock
have moved the country much closer
specific fee on a transaction, he con-
options and land, the proceeds of which
to global regulations in terms of disclo-
firms. We are more interested in being
can be collectively described as new
sures of fees.
able to capture the flow of the transac-
money, says Bhagat.
tion for the client. Given all the tax

In line with this, Bhagat suggests the
benefits in India for mutual funds, about
IIFL Private Wealth Management has
majority of the larger firms are going to
50% of our clients portfolio will always
found it easier to go after this type of
struggle to move to advisory mandates
be in these products, so we need to be
business. Old money typically went
because the fee structure doesnt
sharper in this business to get access
with established wealth management
support their cost base. He adds that
to the remainder of their portfolios.
brands, he explains. Even if you did
IIFL Private Wealth Management is
break through, the client would possibly
exploring internally whether it could
The firms retention rates are healthy,
start with 5% of their portfolio and test
potentially make such a move.
he concludes. We are possibly a little
you over 12 months to 24 months

before scaling up their portfolio.
less expensive in commoditised prodThe advisory model is challenged by
ucts and a little more expensive in ex-
the commercial reality of the business,
clusive products, but we get the exclu-
So while the firm does business with
because typically in India, clients have
sive products because we are sharper
established wealthy families, it couldnt
been averse to paying fees, he explains.
in the commoditised space.
101
EVENT HIGHLIGHTS - THAILAND WEALTH MANAGEMENT FORUM 2016 - MAY
Thai potential heralds new dawn

for wealth management offerings
Discussions at our 5th annual event in Bangkok for the local wealth management
industry highlighted renewed belief in the opportunities for the countrys banks, insurers,
asset managers and independent advisers.
The potential for open architecture
viduals from the leading private banks,
platforms to evolve and facilitate a more
retail banks, investment advisers,
holistic wealth management offering is
brokers, insurers and asset managers.
gathering momentum in Thailand.

Ultimately, clients are starting to want
In a declining interest rate environment,
more choice. This is coupled with a more
clients are starting to look at new prod-
conducive and supportive regulatory
ucts to diversify portfolios. They are
environment in the country, offering
moving from a risk-averse mind-set
the traditionally risk-averse investors
where they focus on savings via depos-
greater scope to invest more offshore.
its, money market funds and fixed

income towards equities, mutual
But the logistics to make this happen and
funds and some alternatives. More
take root will take time. There is still much
broadly, with the growing wealth, the
to be done locally to raise advisory capa-
scope for banks and advisory firms to
bilities, the quality of the product offer-
penetrate more clients with a wider
ings and consistency in standards. There
array of investment products, insurance
is also a pressing need to enhance
solutions and other services is more of
systems, training and processes.
a reality than ever before.

More specifically, although local banks
These were some take-aways from this
continue to have a lot of influence in
event attended by 275 senior indi-
terms of distribution, as they move from

BNY Mellon
Henderson Global Investors
Henley & Partners
IRESS
Labuan IBFC
Pafilia
Vermilion Software
Allianz Global Investors
ASK Group
AXA
BVI House Asia
Charles River
Commerzbank
Enhanced Investment
Products
Franklin Templeton
Investments
J O Hambro Capital
Management
Morningstar
Rosemont
Swiss Life
Swiss Asia
Thomson Reuters
UTI International
captive to open architecture, they will

need to find innovative ways to develop
more of the capabilities themselves.
102
Adisorn Sermchaiwong
Charnwut Roongsangmanoon
Don Charnsupharindr
Evan Gallagher
John Robson
CIMB
MFC Asset Management
Citi
ASK Capital Management, Singapore
Quantifeed
Kittikun Tanaratpattanakit
Kris Chantanotoke
Mandeep Nalwa
Michael Benz
Ned Phillips
Morningstar
Thai Life Insurance
Taurus Wealth Advisors
Nont Buranasiri
Patrick Donaldson
Paul Gambles
Praveen Jagwani
Ranjit Khanna
Kasikornbank
Thomson Reuters
MBMG Group
UTI International
Samdarshi Sumit
Shanker Iyer
Steve Knabl
Sukit Jarutchaiwanna
Ted Low
Generali Life Assurance
Swiss Asia
GAO Capital
Theeranat Rujimethapass
Thomas Friedberger
Trawut Luangsomboon
Vira-anong Chiranakhorn Phutrakul
Win Phromphaet
Tisco Asset Management
Jitta
Citi
CFA Institute
Bambu
103
Win Udomrachtavanich
Angelo Venardos
David Varley
Michael Gagie
Philip Lung
One Asset Management
AXA
Maples and Calder
BNY Mellon Investment Management
Scott Moore
Sumetha Lewchalermwong
Vinay Kumar
David MacDonald
Henley & Partners
Franklin Templeton Investments
Hubbis
Im very impressed with how many industry practitioners are here, especially
individuals who know the business and are willing to share insights without
holding back.
Nont Buranasiri, Private Banking Family Wealth Management Advisory Head, Kasikornbank
104
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EXPERT INSIGHTS
Kasikornbank shows way to

service HNW Thais
When Jirawat Supornpaibul joined Kasikornbank (KBank) in early 2013, his mandate
was clear: build the best onshore private bank in Thailand. Already, he seems to be well
on his way to achieving this.
It is hard to see how KBank could have
to Thailands growing number of HNW
grown its private banking business any
individuals in a more significant way.
faster than it has to date.
Of the USD19 billion within the private

bank, 60% is still in deposits and only
Jirawat Supornpaibuls strategy to scale
40% is under our advice. So we cannot
this division under his leadership began
really say yet that all of this is AUM,
simply by inviting the banks privilege
he explains.
customers to upgrade their account

status to private banking.
The challenge he faces, therefore, is to

find ways to increase the take-up of
Underscoring his initial progress in just
funds and other investment services
three years, his business has amassed
among the HNW amid an effort to nudge
over 9,000 HNW clients and more than
them along the path to a more advisory-
USD19 billion in overall assets.
type relationship with the bank.
Added to this achievement is the part-
BUILDING BLOCKS
nership it has forged with Lombard
Supornpaibuls plan is to build the
Odier in terms of family wealth manage-
private banking proposition around
ment services, to widen its product of-
three pillars: quality of advice, quality
fering and add a global perspective for
of product, and quality of service.
JIRAWAT SUPORNPAIBUL
Kasikornbank
KBanks Thai client base.

With existing offerings ranging from
Yet Supornpaibul is a realist who knows
stock trading to security deposits, he
However, he knows he needs to steer
that the job is still far from complete.
says the bank is well-placed to cater to
clear of servicing the typical short-term
He is now focused on building KBanks
most of the financial needs of HNW
trading mind-set of local investors.
investment advisory platform to appeal
clients in Thailand.
Instead, he is exclusively focused on
106
EXPERT INSIGHTS
helping customers to take a longer-term
Every one of my clients has lots of land,
view on their investments.
which is why we are expanding our noncapital market services, he says.
We are more focused on creating longterm wealth, he adds.
Our wealthiest clients have the chance

to speak to Goldman Sachs, UBS,
This strategy has an added cost advan-
Morgan Stanley, Credit Suisse or others
tage; it allows KBank to have fewer
when it comes to capital markets, so we
relationship managers (RMs) in total.
cannot compete on offshore products.
For example, it only has 50 RMs, with

each looking after around 200 clients.
So KBank is instead tapping on its wide,

local network and knowledge base when
The number of clients for each RM
it comes to the property market to gain
might seem high, but since they dont
a foot in the door with this client
do short-term trading [for their clients],
segment. We have a broad network of
they do not need to be glued to a monitor
people who want to buy and sell, and
the whole day, explains Supornpaibul.
also we are the financiers of many prop-
They can go out and meet clients and
erty projects, he explains. As we have
work with their portfolio.
the expertise, this is an area where we

can compete.
The approach of streamlining staff

extends to the advisory offering too. For
For example, he adds, a lot of these types
example, the bank has one financial
of clients acquire acres upon acres of
adviser for every five RMs.
land, but after a while it becomes costly

for them keep those assets without
Here again, Supornpaibul rationalises
generating any return from them,
this ratio because his RMs are also
because they just add to the tax burden.
equipped to construct investment portfolios for their clients.
These people have expertise only in

collecting land, not developing it. They
At the same time, he believes open ar-
also do not know how to sell it.
chitecture is the way to go. This also

includes feeder funds for investors who
The specific opportunity Supornpaibul
are looking for more diversification by
sees is in advising these clients on the
investing in overseas markets.
holding structure for their land so that

it minimises their tax burden.
ACCESSING OLD MONEY

The centre-piece of the private banking
He believes that providing a proper
strategy, meanwhile, is being built
service to clients in this area will deepen
around KBanks ability to straddle both
their relationship with the bank and
capital markets and non-capital mar-
could, in turn, make them potential cus-
kets-related demands of wealthy Thais.
tomers for capital market solutions as
Planning for the future

There are several emerging
areas of interest for KBank.
These include family office
services, tax planning and
creating family constitutions.
Private equity will also be
important going forward.
In Thailand, for example, this
part of the market is still
relatively disorganised, so
Supornpaibul wants to start to
build a network of people who
are looking to put their money
into start-ups.
Unlocking more of the potential
for private banking in Thailand
also calls for changes from the
regulator. In particular, says
Supornpaibul, there is a
growing need to meet the
requirements of the landowning HNW clients.
Estate trusts are the big topic
for discussion in Thailand.
People are looking for assetholding solutions that can
keep their assets for many
generations.
At the same time, he adds, the
regulators shouldnt shield local
wealth managers from overseas
competition.
I love to be in an open
competition, I dont want to be
protected. If you are protected
from international markets, you
cannot improve your capability.
well, in the long run.

In particular, Supornpaibul says that
offering more than just investments is
We look at the whole picture, he ex-
help a small client who has his money
key to wooing HNW clients in Thailand,
plains. And at this point we dont mind
tied up in land to get some of the pro-
given that so much wealth is tied up in
if we are not charging a fee for our
ceeds back, this individual could become
real assets such as property and land.
advice. We want to build trust. Once we
a big client.
108
allocated
bullion
solutions
LIQUIDIT Y & TECHNOLOGY
EXPERT INSIGHTS
Bringing a broader and deeper

offering to Thailand
With the local stock market flat and interest rates low, a new approach is needed to
service the investment and other financial needs of Thai investors all along the wealth
spectrum. Don Charnsupharindr of Citibank is trying to drive such change.
Wealth management in Thailand is
A TARGETED APPROACH
changing. At the top of the wealth
With three retail banking branches in
pyramid, there is a small number of ultra-
the country, the Citi offering has to be
wealthy, with a growing number of indi-
carefully tailored to the banks cus-
viduals in the HNW segment. Following
tomer base. This means focusing on the
in their footsteps is an-expanding group
Citi Priority and Citigold segments.
of mass affluent customers.

Launched in 2016, Citi Priority focuses
Inevitably, each of these groups is
on clients with THB1 million
looking for a different kind of help in
(USD26,000) to THB3 million to invest.
terms of investment opportunities and
Citigold, meanwhile, looks at clients
wealth-related needs.
with at least USD100,000 equivalent.
Don Charnsupharindr, head of retail
The banks approach in Thailand over
banking for Citibank in Thailand, has
the past three years to drive a longer-
been doing some hard thinking about
term mind-set in investing has been to
how to service these different sorts of
offer its clients a global allocation-type
customers in todays more challenging
of advice.
DON CHARNSUPHARINDR
Citi
and volatile environment.

During this period, Citi has seen clients
In the past few years, there has been
show more interest in investing in
a lot of development in the wealth space
Foreign Investment Funds (FIFs).

work with companies such as Allianz,
in Thailand, he says.
These are a version of the foreign funds
JP Morgan and BlackRock. They bring
The big question, is which clients want
that get wrapped by local fund houses.
in the offshore fund and then wrap it
to start to delve more into mutual funds?
For example, Citi has Thai partners who
in the form of a local fund, in line with
110
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EXPERT INSIGHTS
what local regulations allow. Citi has
have the potential to become Citigold
also recently launched direct investment
clients, he adds.
into some offshore funds.

PROACTIVE REGULATION
Falling interest rates have also played
Regulation also has its part to play in
their part in creating more opportuni-
helping the market to develop.
Three challenges to Thai

success in wealth

First, getting the

infrastructure right to give
clients more flexibility and
choice around what they
invest and with whom.
Secondly, education
internally to ensure advisers
have the right mind-set,
and externally for clients to
think longer term.
Thirdly, planning for the

future which is largely
guesswork when looking
10 years into the future,
but includes making wealth
management mobile and
enabling clients to review
their portfolio and interact
with advisers anywhere,
any time.
ties, awareness and interest in new

types of investment products as part of
For example, explains Charnsupharindr,
a wealth management strategy.
the governments deposit protection

scheme has previously set out that all
Just five years ago, one could easily
bank deposits are fully protected, al-
see time deposits in the range of 3% to
though the authorities are gradually
4%, observes Charnsupharindr, but
reducing this level. In the future, the
today its hard to get anything beyond
limit will be reduced, to THB1 million.
the 1.5% to 2% range. Times are even

harder in the securities market. The
Charnsupharindr thinks this change will
bond yield curve is around the 1.5%
encourage more people to start thinking
plus or minus range, he adds.
about how they diversify their invest-
Citi as a global bank will play a role in terms of

being that alternative choice for Thai clients.
sumer. I think this is absolutely the right

direction, adds Charnsupharindr.
He sees this as creating opportunities
ments, in turn potentially expanding the
Yet despite a more open market and the
too: I think it encourages clients to think
relationship they have with banks.
new freedoms it offers Thai investors,
about how to manage [their wealth] in
there is little doubt that they have a
a more open-minded manner and not
From this perspective, Citi as a global
constrain their strategies to what they
bank will play a role in terms of being
have traditionally been used to.
that alternative choice for Thai clients,
As a result, the feeder funds as well as
he explains, as well as having the broad
local funds will continue to be at the
While Citi does not compete on a
product range for our clients to select
core of the wealth management busi-
branch basis with local players, its
from, especially bringing in offshore
ness for banks like Citi.
network, digital platform and the es-
products that are really our strength for
tablished card business it has, do
both our regional and global wealth
For clients who are more sophisticated
provide other opportunities too.
management platforms.
and looking to have some exposure in
preference for investments in Thai baht.
other currencies or to other products,

Our card business has a much broader
In general, the Thai government, in con-
meanwhile, they have the option of
presence in the Thai market, explains
junction with the Bank of Thailand and
additional choices and alternatives. We
Charnsupharindr.
the securities regulator, seems to have
see it as something that complements
come a long way in terms of measures
and further develops the wealth man-
We then try to understand the client
to create a more competitive landscape
agement industry in Thailand, says
base and identify those individuals who
that will eventually benefit the con-
Charnsupharindr.
112
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EXPERT INSIGHTS
Thai insurers jump on

diversification bandwagon
The affinity many Thais have had with savings products is slowly changing. And
insurance providers want to tap this demand through diversification in the product
offering and new distribution channels, says Kris Chantanotoke of Thai Life Insurance.
To date, around 50% of life insurance
from the Thai General Insurance As-
products sold in Thailand have been
sociation (TGIA) 4.1% for life insur-
savings-related; basically an annuity
ance and 1.7% for non-life insurance.
endowment product with a guaranteed

interest rate.
It is little surprise, therefore, to see

providers looking to capture as much
These provide the much-sought after
of this opportunity as they can.
sense of security via a fixed return in a

given year. And most of them have been
Thai Life Insurance, the countrys third-
sold through the banks.
largest player in this space, is wellplaced among them. And it further
However, the game is starting to
bolstered its position in December 2015
change. With an expanding middle class
by acquiring Thai Cardif Life Assurance.
and a growing awareness and understanding of whats available, growth in
At the time, one of the drivers for the
Thailands insurance sector is underway.
deal was for Thai Life to be able to

broaden its distribution capabilities,
In response to this potential for a wider
including its non-agency and tele-
array of solutions, insurance companies
marketing channels. In line with this, it
are developing both their distribution
formed a new unit called Thai Life Part-
channels and range of products. With
nership Solutions.
KRIS CHANTANOTOKE
Thai Life Insurance
such diversification, they believe they

can penetrate greater market share.
For the time being, however, bancas-
The deposit rates are not very high, so
surance continues to dominate sales in
banks offer this product to make sure
The positive signals for the insurance
life insurance; accounting for half of the
they can retain the customer and diver-
sector are evident in growth predictions
market in Thailand.
sify their investments, says Kris Chan-
114
tanotoke, senior executive vice presi-
they are trying to make sure their front-
their own products anymore, explains
dent at Thai Life.
line staff are better educated about
Chantanotoke.
insurance and can discuss the options

DIVERSIFICATION LOOMING
with customers based on goals and
For example, the banks and other finan-
Yet Thai Lifes rationale to broaden its
objectives not just commission.
cial companies can provide clients with

a variety choices of products, including
distribution is certainly a sound one.

OPEN ARCHITECTURE
combining investment funds together
The low interest rate environment plus
Against this backdrop, Thai Life is in the
with insurance solutions.
the ever-reducing disparity between
process of partnering with a local bank
rates in developed and developing coun-
to design a platform for customers to
And insurance providers and asset man-
tries is impacting the appeal of savings
register all their insurance and asset
agement companies alike can therefore
products among the emerging affluent
management products, whoever they
then reach more customers through a
in Thailand. This is driving interest
bought them from.
single channel.
tional fixed income offerings towards
While still a work in progress, Chan-
MORE TOUCH POINTS
products such as unit-linked policies.
tanotoke says the platform will enable
Growth is on the agenda for Thai Life
among customers away from the tradi-
Partnership Solutions, meanwhile, to

expand the number of firms it ties up
with, says Chantanotoke.
Anybody who has a proper touch-point with the

customer can play that role, which means that an
insurance company today might be a wealth
management company in the future.
It wants to broaden its partnerships

from banks to non-banking institutions,
including retailers, consumer finance
companies and telecoms, furthering its
customer reach in the process.
Going digital is another priority.
The firm is aiming to use new tools in
order to go directly to customers, as
Chantanotoke says this shift is also
insurance agents to track their clients
part of efforts to increase the number
taking place as customers become more
overall exposure to all asset classes, in
of touch points beyond agencies and
aware of what they want to invest in and
turn helping them provide more tailored
existing partners.
how they want to diversify their risk.
and relevant advice.
For example, he explains, they are
The partnership can also be extended
will start to become more of a reality
looking for something more attractive,
to the product offering, he adds, creat-
as insurance companies make a greater
which varies the yield and enhances
ing an open architecture for banks and
foray into wealth management.
their opportunity to gain more.
insurance companies.
And Chantanotoke says he expects this
Anybody who has a proper touch-point

This also highlights the importance for
Such an approach to insurance is where
with the customer can play that role,
insurance companies of helping to drive
he says the industry should head, bring-
which means that an insurance company
more of a needs-based conversation
ing benefits to all parties.
today might be a wealth management

company in the future, he explains.
with customers.
At the end of the day, the distribution
According to Chantanotoke, a number
channels need to become more open
This is something we are looking at
of the leading local retail banks are now
architecture, in selling more investment
and expect to happen; it is just a matter
more focused on segment marketing;
and financial products, and not only
of time, he adds.
115
FIRM PROFILE
Kasikorn Asset Managements

vision for Thai distribution
The firm is looking to take its product offering, infrastructure, and digital and data
capabilities to the next level as it strives to bring something new and wholly more
international to wealthy Thai investors, explains Benjarong Techamuanvivit.
The key to wealth management, across
by offering investment products which
most of Asias markets, is balancing
now span global markets. On offer are
demand and supply.
a mix of asset types, specific industries

and regions.
Customers needs are evolving rapidly

and getting more complex, requiring
And the firm is eager to expand direct
providers to fit new products to their
investment capabilities to the regional
demands. All this has to be achieved
level, says Benjarong Techamuanvivit,
within a tougher regulatory framework
first senior vice president in the strate-
that is also changing.
gic planning division.
KAsset has kept a keen eye on service,

by ensuring its technology is up-to-date
and multi-channel, making it relevant to
however clients want to invest.
BENJARONG
TECHAMUANVIVIT
Kasikorn Asset Management
In Thailand, Kasikorn Asset Manage-
At the moment, it has a domestic
to index local and foreign mutual
ment (KAsset) has emerged as one of
market share of nearly one-quarter in
funds, to money market vehicles, ex-
the countrys leading firms of its type
various funds ranging from active
plains Techamuanvivit.
116
The firm has also kept a keen eye on
across the globe. In February 2016, for
service, by ensuring its technology is up-
example, besides FIFs, KAsset intro-
to-date and multi-channel, making it
duced K-AEC for direct investment in
relevant to however clients want to invest.
ASEAN stocks.
A BALANCED STRATEGIC VISION
Further, demographic shifts have moti-
Doing this via digital solutions is very
vated KAsset to develop products that
much front-of-mind for the firm as part
cater to the needs of every market.
of its strategy.
For instance, K-GA is suitable for inves-
Tangible growth goals

for KAsset
With all the plans that KAsset
has for 2016, it says that it
expects to attract about 27,000
new customers over the course
of the year.
The firm is also continuing
to focus on growing AUM
from THB1.136 trillion as of
December 31, 2015, by 4%
year-on-year.
This includes enhanced platforms that
tors who prefer to diversify their invest-
make investment easy, under the banner
ments in various types of assets around
of Simplify Your Investment Life.
the globe.
For example, KAsset has said it wants
K-STAR, meanwhile, offers automat-
to introduce investment portfolios
ic investment unit redemption once
customised for individuals financial
the investment units reach their ex-
aspirations. And in line with this, in the
pected value. This allows investors
pipeline is a new service called My
with little time to follow the markets
with online functionality for its range of
Port Simulator.
to yield profits.
mutual funds and other businesses.
This will allow investors to find the most
Additionally, K-GINCOME is for inves-
When it comes to the product offering
suitable asset allocation models.
tors which want a regular cash flow.
too, she says KAsset is not just focused

on launching new products.
Instead, there is an ongoing review
When it comes to the product offering too, KAsset

is not just focused on launching new products.
Instead, there is an ongoing review process
to determine which ones to take off the shelf
and which products need to be launched.
process to determine which ones to take

off the shelf and which products need
to be launched.
The ASEAN-focused funds are a good
example. Plus, having such a capability
also indicates the way forward.
In the future there may be some other
asset class that we can leverage via our
research, says Techamuanvivit.
Yet while enhanced distribution will enable
IMPROVING INSIGHTS
the firm to reach new investors, Te-
Amid these growth plans, Techamuan-
The local knowledge the firm has is also
chamuanvivit says product development
vivits objectives, she adds, include im-
important.
remains a cornerstone of the business.
proving business analytics.

We do company visits and research
Externally, KAsset is looking to further
We are enhancing our customer rela-
work ourselves and, of course, if we are
diversify its investment options, driven
tionship management capability.
talking about the longer term three

years onwards I think the middle-in-
by what it foresees as economic interconnectedness. More specifically, the
These initiatives will also form the foun-
come clients will still need our advisory
firm has plans to extend investments
dation to develop mobile tools along
service, she adds.
117
FIRM PROFILE
A novel approach to wealth

advice in Thailand
MBMG Group has carved a niche within the countrys wealth management industry an
independent offering combining investments, insurance, corporate solutions and family
office services. And it charges for the quality of its advice.
The real need for wealth management
ally evolved and expanded albeit at a
in modern-day Thailand can probably
slower pace than many investors and
be traced back to the Asian financial
practitioners have wanted.
crisis of 1997. Until that point, the currency, the Thai baht, had been pegged
Despite a wide number of internation-
to the US dollar, exchange control
al investment assets and opportunities
regulations constrained capital flows,
being made available in various guises
and strict rules inhibited foreign owner-
in Thailand, investors can still only get
ship of Thai investments and assets.
a much narrower range of options than

they can in jurisdictions like Singapore
Nearly two decades later, the initial
or Hong Kong.
need to manage the currency has given

way to a broader requirement for invest-
This is where Paul Gambles believes
ment advice, insurance solutions and
that the value proposition of MBMG
other services to meet the needs of
Group really becomes clear. And, in
emerging affluent as well as individuals
particular, its investments-focused divi-
further up the wealth pyramid.
sion, MBMG Investment Advisory. As

co-founder of the group, and managing
PAUL GAMBLES
MBMG Group
Whats more, the inbound and out-
director of the investment advisory arm,
bound flow of funds has been signifi-
Gambles has spearheaded the delivery
cantly liberalised and many qualifying
in the Thai market of fee-based global
Thai assets have been opened to wider
advisory services to both locals and
overseas ownership.
expats alike.
In line with this, the product range in
The rationale has been the following:
offshore, this approach can add invest-
the local financial markets has gradu-
with wealth continuing to grow and
ments which are relevant and inter-
customers starting to get more sophisticated and interested in venturing
118
national to their portfolios. It is very
In pursuing this approach, Gambles is
difficult to get global investment and
confident about how his firm has been
wealth management advice in Thailand,
performing in terms of delivering com-
explains Gambles, who also serves as
petitive and cost-effective products to
chief investment officer.
clients. ETFs are one example of many.
While a lot of firms do a good job of
COMPETITION DRIVING BETTER
offering local products, there is defi-
SERVICE
nitely a shortage of international knowl-
This type of competition and alternative
edge, so we tend to focus on bringing
for providing wealth management
all of this together, consolidating what
advice is also exactly what Gambles
people do with their local and interna-
thinks the local market needs.
tional exposures combined, he adds.

This is in order to create greater interest
VALUE OF A FEE-BASED
and attract more quality to the industry.
MODEL
MBMG Investment Advisorys business
In general, there seems to be little incen-
model is quite different from how the
tive for most Thai retail banks to focus
banks and other traditional players in
on private banking services, given their
the local wealth management industry
successes in the various retail segments.
We get paid a fee, so the better the job

our advisers do, the higher the chance they have
of getting an ongoing fee.
Doing the right thing

by clients
MBMG Group has been focused
on providing relevant advice
to its clients in Thailand since
opening its doors in 1995.
It has developed into a provider
of investment advice, corporate
solutions, insurance and family
office services. And it has
expanded from its initial focus
only on expats to now working
with many local clients.
Its advisory arm, MBMG
Investment Advisory, is
registered with and licensed by
the Securities and Exchange
Commission of Thailand,
providing investment advisory
services and as a derivatives
adviser.
Among its advisory services
are: financial and investment
planning; investment funds;
retirement funds; currency
markets; trusts; wills &
foundations; insurance; and
tax planning.
operate. But Gambles says that he con-
As a result, there are few organisations
siders this to be an important learning
around to provide real investment
control most of the wealth in the
curve for the market.
advice of the type that MBMG Invest-
country, to several hundred.
ment Advisory offers.

In the meantime, he explains, more
With the fees that the firm charges its

clients based on the advice it gives to
At the same time, there is a need for
and more wealthy foreigners have
them, it places the focus and emphasis
more people and products to continu-
decided to move to Thailand, or they
of each adviser on the suitability of what
ally educate the wider market about the
might have chosen to buy a second
they are offering to their clients, to meet
scope of global opportunities.
home in the country.
GROWING PIE
These two groups are examples of the
We get paid a fee to do this, says
Gambles also says he has seen growth
expanding demand for more effective
Gambles, so the better the job our
in the number of wealthy families in the
and cost-efficient ways to manage
advisers do, the higher the chance they
20 years he has lived in Thailand in-
wealth in the HNW and family office
have of getting an ongoing fee.
creasing from a handful of those which
space, adds Gambles.
their needs.
119
EVENT HIGHLIGHTS - PHILIPPINES WEALTH MANAGEMENT FORUM 2016 - MAY
A need for more investment and

conviction in the Philippines
The country faces a variety of hurdles to develop its wealth management industry.
Overcoming risk-aversion to turn more savings into investments, expanding the product
range, and developing more advisory capability are all key ways to breed investor
confidence and engagement.
Wealth management in the Philippines
regulator needs to step in to help en-
continues to be characterised by savers
courage a more structured and com-
rather than investors. Inevitably, this
prehensive approach to investor educa-
is a consequence of the availability of
tion and professional development.
mostly simple products. Innovation

remains relatively stifled.
At the same time, banks need to evolve

their offerings and models to really dif-
With three different regulators respon-
ferentiate themselves, as fees and
sible for oversight for banking, asset
products are still too similar. Part of this
management and insurance, there is no
relates to developing digital tools and
level playing field to provide products
driving a more relevant customer en-
and services in an efficient way.
gagement; this is the focus for most

banks for the time being. It is also
The win-win, it seems, will come when
critical as they look to make themselves
advisers offer needs-based selling via
more relevant for the millennials, plus
open architecture platforms, and when
to create a more long-lasting impression
investors become a bit less risk-averse
on clients today.


AG Delta
Henley & Partners
Asiaciti Trust
ASK Group
AXA
Commerzbank
Franklin Templeton
Investments
J O Hambro Capital
Management
Legg Mason
Swiss Life
Swiss Asia
Thomson Reuters
via investments and insurance solutions

as a way to build and protect wealth.
Priorities for the development of wealth

management in the Philippines include:
However, to ensure any initiatives have
educating investors as early in their
investing; enhancing the competency
meaning and will have an impact, the
lives as possible to be more aware of
of bankers and other advisers / agents

through more formal training and assessment; broadening the investment
options via a greater array of investment
products; and enabling more access to
invest overseas.
These were among the key talking points
at our 2nd annual event in Manila, where
250 senior individuals attended across
the top retail banks, trust banks, securities firms, insurance companies and local
asset management firms.
120
Aaron Mullins
April Tan
Carlos Jalandoni
Clement Lee
Dhawal Kamath
Asiaciti Trust
COL Financial
Bank of the Philippine Islands
Legg Mason
Frederico Ocampo
Gaurav Malhotra
Ida Mendoza
Josefina T Fno
Leonardo Roxas Arguelles
BDO Unibank
ASK Capital Management, Singapore
CTBC
Metropolitan Bank & Trust
Unicapital Group
Maria Lizette Perez
Maria Paz Garcia
Michael Enriquez
Nina D Aguas
Noel Andrada
Metropolitan Bank & Trust
Bank of the Philippine Islands
Sun Life Financial
Insular Life
BDO Unibank
Phillip Hagedorn
Rafael Ayuste
Randell Tiongson
Rizalina Mantaring
BDO Private Bank
Registered Financial Planner

Institute Philippines
Reynaldo G Geronimo
ATR Asset Management
Romulo
Sun Life Financial
Robert B Ramos
Roberto Vergara
Steve Knabl
Thomas Henze
Valerie Pama
Union Bank of the Philippines
Philippine National Bank
Swiss Asia
Swiss Life
Sun Life Asset Management
121
Anthony Campbell-Brown
David Varley
Dominic Volek
Sandeep Lalwani
Stephen Lingard
AG Delta
AXA
Henley & Partners
The attendance was great and the coverage of all the key topics has been
really good, including client engagement, regulation, new products and
digital trends.
Maria Lizette Perez, Head, Private Banking Division, Metropolitan Bank & Trust
122
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EXPERT INSIGHTS
Changing the Philippines

investment mind-set
Robert B Ramos of the Union Bank of the Philippines explains why investor education
and formal training for front-line bankers can make a wealth management offering more
compelling. This will change how the countrys emerging affluent think about investing.
When it comes to the concept of wealth
Philippines. People dont talk about
management in the Philippines, most
investments based on their current
investors still seem set in their old ways.
objectives, their time horizon, or their
With the mentality of savers, they
needs. What they do know is that equi-
prefer to hold most of their liquid assets
ties are volatile.
in time-tested fixed deposits, rather

than investing in mutual funds that offer
Tied to this mind-set is also a preference
the promise of higher returns and also
for holding investment assets in the
more diversification.
form of a trust.
A major appeal of time deposits is the
Though these are widely-accepted
2.5% fixed return on offer. Yet while
structures in the Philippines, they make
high enough to beat inflation, what they
the process much more cumbersome.
earn is significantly lower than the

average 8% from equities on the local
A trust is a complex structure, adds
stock exchange.
Ramos. It integrates the US asset management and custody businesses into
ROBERT B RAMOS
Union Bank of the Philippines
As a result, it is difficult to see how most
one service. It serves its purpose here
of these individuals can achieve their
but we need to learn from what is hap-
long-term financial objectives.
pening in other countries.
There is much greater comfort with
EDUCATION TO PAY OFF
time deposits, explains Robert B
Being able to deepen the understanding
Only then, says Ramos, will they be able
Ramos, first vice president and trust
among investors generally of the value
to objectively evaluate the risks as well
officer within the trust and investment
of wealth management relies on proper
as returns trade-offs associated with
services group at the Union Bank of the
education about products.
investing without getting disheart-
124
ened by short-term influences, such as
make it compulsory. At present, with
market volatility.
bank staff able to take or leave these

courses, few advisers lack formal cer-
In line with investor education, advisers
tification and training.
too need to increase and widen their

knowledge, he adds.
STANDING OUT
Beyond the quality of their advisers, a
The common approach in the Philip-
big challenge for banks in the Philip-
pines at the moment not dissimilar to
pines is to differentiate themselves, as
what happens in many Asian markets
fees and products are broadly similar.
is to sell products which are front-of-
Often, clients pick one bank over
mind. And in the Philippines, this tends
another based on just one criterion:
to mean a time deposit. If we try to
location. Clients go to a bank thats
provide more in-depth training to advis-
nearest to them, explains Ramos.
ers to enable them to understand what

might be suitable for a client, it will allow
The surest way to make an impression
them to offer different products and
on the client, therefore, is to enhance
services that will fit the needs of these
the customer experience. This comes
clients, explains Ramos.
back to the importance of quality of
Often, clients pick one bank over another

based on just one criterion: location.
But prioritising financial education for
advice. Products are standard, so you
investors rather than advisers may result
cant really be exotic in your offering.
in a bigger bang for the buck.
So you have to compete on experience.
It will, says Ramos, deter advisers from
Those banks which are able to offer a
taking the easy road by trying to recom-
broad array of products and services
mend products for a client without first
under one roof will also have a greater
taking the time to understand what is
chance of success. But to achieve this,
suitable for them.
institutions need to change the way

they sell products, to integrate various
The win-win will come when advisers
aspects of the wealth management
embark on the road towards needs-
process into a single function.
based selling at the same time as investors look beyond short-term gains
If you create alliances that allow you
towards building long-term wealth.
to do different investments through one

account, you are in a better position to
Meanwhile, to ensure that any initia-
succeed, says Ramos. Wealthier clients
tives can have the most impact, the
are short on time, so they want a one-
regulator is likely to need to step in to
stop shop.
Building the right wealth

proposition for the
Philippines
Union Bank has identified its
target customer segment as
the emerging mass affluent
meaning individuals with between
USD80,000 and USD500,000 in
investible assets.
The appeal of these individuals is
clear, says Ramos.
They have the potential to
generate more business as they
grow in wealth and stature; they
can also serve as a good source of
referrals for the bank.
In contrast, the relatively few
HNW and UHNW individuals
in the Philippines present less
potential for many local bankers;
these clients like to place some
of their assets in more mature
markets such as Singapore and
Hong Kong.
It is also perhaps more realistic for
local banks to target the affluent
segment given the limited amount
of product innovation.
While there are different types
of fixed income and equity funds
to offer short-, medium- and longterm investment choices,
the strategies adopted by different
funds are more or less similar,
if not identical, says Ramos.
There is a need to bring in
more variety.
One way of adding variety to the
product mix is to have an open
architecture model, where banks
can sell funds from other providers,
says Ramos.
Union Bank is adopting this
approach, he reveals, but this is at
an early stage.
125
EXPERT INSIGHTS
Catering to a more global outlook

in the Philippines
With restrictions in the types of funds which can be offered locally, Nanjo Berba of
Philam Asset Management, Inc. (PAMI) explains what the firm is doing to capitalise on a
growing interest among the affluent in accessing global investments.
With a growing economy that prom-
of the strategies that PAMI has adopted
ises better days ahead in the Philippines,
to try to stand out.
more and more emerging affluent individuals are eyeing global investment
As an ambitious local firm, which ranks
avenues to grow their wealth.
itself as number-three in the asset management pecking order it is also trying
Seeing this unfold, PAMI is among
to be innovative in terms of its distribu-
those firms which is acting on this op-
tion model; it is moving to a digital
The Philippines is a growing economy, which means

the existing market will become more affluent.
NANJO BERBA
Philam Asset Management, Inc.
portunity by tying up with interna-
platform as well as tying up with the
tional peers to offer a broader set of
largest pawn-shop chain in the country.
products to its clients.

The Philippines is a growing economy,
plains Nanjo Berba, PAMI president and
In a competitive market which is dom-
which means the existing market will
chief executive officer. These investors
inated by large foreign rivals such as
become more affluent, and will want to
are already aware they are not going to
Sun Life Asset Management, this is one
invest more to grow their money, ex-
get the kind of growth they want from
126
bank deposits, which has to date been
This, he adds, explains why they prefer
The objective of this, is to ensure that
the preference of domestic investors.
bank-offered instruments, since this
more people can afford to invest, ex-
gives them protection of the principal,
plains Berba.
FINDING NEW OPENINGS
despite the low returns.

The firm is looking for non-traditional and
The need to think differently about their

investment strategy has driven an in-
A NEW APPROACH
non-bank partners who can reach people
creasing number of the countrys
The obstacles for asset managers have
in the lower to middle income levels.
wealthy to look to buy global invest-
convinced Berba that the biggest prior-
ment products such as equities, fixed
ity for PAMI is to be different.
that competition at the HNW individual
income and balanced funds, on offer

from various asset management firms.
We want to tap a wider market given
Thats the only way to grow, he believes,
level is already quite saturated, he adds.
and he says he is planning to achieve

In PAMIs case, in order to reduce any
his goals by ramping up distribution as
Thinking out-of-the-box like this gives
delays in bringing product to market,
well as spearheading investment educa-
him optimism about what the future
the firms approach has been to launch
tion and awareness. Thats the reason
holds for asset management in the Phil-
feeder funds, sold by Citibank, which
why we are saying that we need to
ippines, as well as for local investors to
are invested in master funds run by

Fidelity Investments.
This strategy has proven effective, says
Berba, within a mutual funds industry
which faces various hurdles to growth.
Two big challenges in the Philippines,
for example, stem from the fact that
investors have traditionally been risk-
Two big challenges in the Philippines stem from

the fact that investors have traditionally
been risk-averse... plus, tough regulators
with strict rules make it difficult to
invest in anything new.
averse, not really looking beyond fixed

income instruments offered by the
banks; plus, tough regulators with strict
rules make it difficult to invest in anyexpand our private client business from
move beyond what is known to be a
local to global, explains Berba.
conservative stance.
asset management companies sell
One of the steps it has taken to date is
Given that economic growth in the
mutual funds, banks sell Unit Trust In-
to go digital by tying up with an online
country has been at a pace of about 6%
vestment Funds, and insurance compa-
distribution channel such as COL
over roughly the last decade, this helps
nies also sell funds, these are essen-
(Citisec Online).
fuel such sentiment.
yet each is governed by a different
At the same time, PAMI is moving
Thats a tremendous change from
regulator and therefore a different set
towards setting up its own digital plat-
where it used to be, and this is the
of requirements.
form, so that in 10 years from now,
reason why we think that [with] more
Berba estimates that 20% of its total
people getting affluent [and] looking for
business will be done digitally.
how to make their money grow, we can
thing new.
In the funds space, for instance, while
tially all similar in their look and feel
However, the biggest growth hurdle
create more funds to cater to what they
remains the local investment mind-set.

Filipinos are generally very conserva-
PAMI is also expanding its distribution
want, explains Berba. This augurs well
tive, says Berba. They like something
network and working on lowering the
for the asset management sector [in the
that is guaranteed.
cost of investing.
Philippines].
127
EVENT HIGHLIGHTS - MALAYSIAN WEALTH MANAGEMENT FORUM 2016 - JULY
Finding the way forward in

Malaysian wealth management
Perhaps most pressing in the country is the need to overhaul the business model, in
large part to kick-start the revenue engine by increasing the penetration of wealth
management products and services as long as this is more focused on the right type
of (longer term) revenue.
Hubbis 6th annual event in Kuala
petitors and regulatory reform, among
Lumpur for the Malaysian wealth man-
various changes underway. Secondly,
agement community, in mid-July, came
players must focus on building the right
at a time when the industry is facing
culture; this needs to come via innova-
one of its toughest-ever years. Markets
tion and human capital. But this is not
are clearly tough for everyone, and chal-
just about product innovation; rather,
lenges are mounting across all aspects
new ways to engage consumers and
of the service and product offering.
leverage relationships. Thirdly, it must

be easier for clients to do business, by
There is little doubt that the dynamics,
giving them multiple points of contact
regulatory intent and demographics are
through greater collaboration. Tied to
all on Malaysias side when it comes to
this is the need for clearer and more
developing a healthy and sustainable
targeted communication for clients.
wealth management market. The ques-
Fourthly, there should be more investor
tion-mark is over the pace it is moving.
education and awareness generally,

with all industry stakeholders required
There are several key ways in which
to play a role in ensuring this.


Henley & Partners
IRESS
Sun Life Malaysia
Vermilion Software
Franklin Templeton
Investments
Mercer
Morningstar
Rosemont
Swiss Asia
Temenos
Thomson Reuters
Malaysian wealth management can

move to the next level. First, there is a
Asset managers, meanwhile, need to
need to embrace change, given the
extend their global offering to the local
inevitable emergence of fintech, the
market, providing professional money
next generation of investors, new com-
management in non-retail structures.
Solution-based versus product-based

offerings will also enable stronger
manufacturer-gatekeeper relationships.
For Islamic wealth management, in particular, there is an opportunity for the
Islamic banks to also focus on HNW
business in addition to the retail market.
In insurance, providers can play a much
bigger role in the wealth management
sector if they can embed advice into distribution and offer more protection.
128
Ai Mei Chan
Alex Tan
Alvin Lee
Alvin Tan
Anthony J. Harper
Affin Hwang Asset Management
AmInvest
Maybank
Standard Financial Adviser
Managed Accounts Partners
Carolyn Leng
Alistair J. Macdonald, CFA
Datin Maznah Mahbob
Dr Mohar Yusof
Gerald Ambrose
CIMB Private Banking
AmInvest
Blueprint Planning
Aberdeen Islamic Asset Management
K R Raju
Kin Onn Kee
Mahdzir Othman
Munirah Khairuddin
Nazaruddin Othman
Blueprint Group of Companies
WIN Group
i-VCAP Management
CIMB-Principal Asset Management
FIMM
Ng Chze How
Philip Smith
Puan Sharizad Binti Jumaat
Raymond Lew
Zurich Insurance
RHB Islamic International Asset

Management
Raj Ganesarajah
AIA Pension & Asset Management
Sun Life Malaysia
Robert Foo
Seamus Donoghue
Shan Saeed
Steven Seow
Yap Ming Hui
MyFP Services
IQI Group
Mercer
Whitman Independent Advisors
129
Danny Chang
Dominic Volek
Hans Diederen
Shanker Iyer
David MacDonald
Henley & Partners
Hubbis
This is a very engaging forum, with interesting topics and good questions
[being asked]. I am privileged to be a part of this [event], which is very useful.
Danny Chang, Head of Managed Investments & Product Management, Standard Chartered Bank
130
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FIRM PROFILE
A wealth of opportunity for

RHB Bank
The Malaysian bank has its sights on building a wealth management offering for the
South-east Asian region that U Chen Hock believes can more-than-adequately compete
head-on with any of its peers.
Its never too late, it seems, for banks in
falls into one or more of these categories
Asia to realise that they need to do more
has a much broader range of financial
with the generally vast number of afflu-
needs that can be serviced.
ent customers on their books.

We therefore see a lot of opportunity
Having under-penetrated and therefore
to do more with them, says U.
under-serviced this segment until now,

RHB Bank is confident about what it can
In practice, these customers have money
do for these individuals. We think there
put aside for investments and are gener-
is a lot of room for us to play more to
ally looking for wealth management
our strengths and build these out over
products, including unit trusts, dual-
time to meet the needs of this segment,
currency instruments, insurance solu-
says U Chen Hock, RHBs head of group
tions, structured products, FX trades
retail banking.
and other types of deposits. And RHB

doesnt want to miss out.
CLEAR SEGMENTATION
What RHB means when it defines its
On the Islamic side of the offering, U says
affluent segment are individuals with
the bank is very much in line with the
a minimum AUM of RM200,000
aspiration of the central bank to grow
(USD49,000), or those customers with
the Shariah-compliant share of the busi-
a home property valued at more than
ness to 40% by 2020; it currently repre-
RM1 million, or people with a salary or
sents around 24.1% of all assets.
income of at least RM20,000.
U CHEN HOCK
RHB Bank
return from their investments, explains

We want to help these affluent custom-
U. This involves how they diversify their
From the banks existing base of affluent
ers make their money work harder for
assets, to give them more choice in
customers, it knows that anyone who
them, so that we generate a much better
terms of asset classes.
132
The overall customer experience, driven
Re-launch
by the service, is another key way that
In line with its business strategy,

RHB is undergoing a re-launch of
its premier proposition, meaning
its top segment of wealth.
To be able to achieve all this, he knows
This involves a refresh of the

brand some elements of which
will reinforce the way it reaches
out to these customers; others
will provide added value, such as
a new premier card that comes
with exclusive benefits.
U believes the bank can stand out.
there is an urgency around developing

talent to support the areas of growth
he has earmarked. We have always
been very strong in the mass segment,
for example, but not as much in the mass
affluent and affluent segments. So,
naturally, if we want to swing our focus,
strategy-wise, to these two segments,
we have to make sure we have the kind
of talent to manage these customers.
INVESTING IN THE VISION
PLAYING TO ITS STRENGTHS
While still in its early days, U says the
To date in Malaysia, foreign banks have
RHB wealth management proposition
enjoyed a significantly higher penetra-
is built on some solid foundations.
tion of products such as funds than their

local counterparts.
RHBs priorities
Over the next few years, U says
the bank has its sights set on
three key objectives.
First, is to continue with its
current strategy to manage its
business by priority segments,
especially its affluent and mass
affluent customer groups, given
that it is yet to fully tap into the
opportunities these both present.
Secondly, is to focus on building
out its digital capabilities.
And thirdly, is to ensure it has the
right type of people to win and
service the business it wants to,
by growing, training and retaining
its talent pool.
We have put in a lot of effort over the

last 12 to 18 months in creating the key
U has been watching this closely as he
pillars to support the people, processes,
looks to make the RHB offering more
products and technology, to help us to
clients, he says. This means engaging
compelling than average, especially
deliver the services that meet the
millennials with tools to reach out to
since many customers are multi-banked.
demands of this segment, as well as
them in more relevant ways, for example
satisfy the expectations in terms of cus-
via mobile apps, to make banking con-
tomer experience, he explains.
venient. This also caters to their prefer-
This involves developing a greater understanding in the first place of what its
ence to transact online.
customers are actually looking for, and
At the same time, to ensure the sustain-
then using these insights to build its
ability of the model as well as client re-
In line with this, the bank launched its
capability to match that.
lationships, RHB is looking to create
RHB Now Mobile Banking Application
more fee-based income streams.
in May 2016 to offer customers simple,
What RHB can also bring to the table

is our regional expertise, says U.
fast and seamless banking experiences

Much of this will be driven by the in-
using smartphones.
vestment on the IT front, starting with

This plays to the appetite of many of
enhancing our loan origination system,
It also includes a first-in-the-market
Malaysias wealthy and aspiring wealthy
plus implementing a new CRM system
feature that enables customers to send
to diversify outside of the country.
along with a portfolio management tool.
money to family members, friends and
We are also going to invest in a brand
any individual using mobile numbers,
We have a regional asset management
new digital platform to provide us with
email or Facebook, without the need for
business out of Singapore, giving us
the kind of flexibility to develop apps as
a bank account number. Recipients can
access to more products than some of
frequently as possible, adds U.
then accept the transacted amount
the domestic players in Malaysia, and
through an RHB account or any other
we can help clients manage their cross-
This should also set the bank up well to
Malaysian bank account. This is part of
border investments, he explains. This
service the next generation. We are
our digital strategy to meet the needs of
is where we are trying to differentiate.
recalibrating the way we deal with these
the new generation, adds U.
133
EXPERT INSIGHTS
Can Malaysia create a real

culture of advice?
A combination of consumer pressure and regulatory reform are needed to enhance the
credibility of the countrys wealth management industry so that it can deliver more value
and genuine advice to investors, says Robert Foo of MyFP Services.
While product-pushing continues to
planning profession as a strong advo-
be prevalent in many developing
cate and voice for an independent and
wealth management centres, Malaysia
unbiased fee-only advisory model, it
faces a particular challenge around
has been difficult for the industry to
this issue which is largely due to a
move forward.
lack of regulatory action and limited

investor activism.
But there is some scope for optimism.
This is according to Robert Foo, co-
There is definitely more acknowl-
founder and managing director of
edgement about a need for advice,
MyFP Services, who says despite some
says Foo, just not at the pace I am
recent new initiatives, the regulators
happy with, because we have been
havent fixed the root of the problem.
talking about it for years.
There is definitely more acknowledgement about a

need for advice, just not at the pace I am happy with,
because we have been talking about it for years.
ROBERT FOO
MyFP Services
model really caught the attention of

As a result, explains Foo, who is well-
Only recently, for example, has the
the countrys central bank, Bank
known within the Malaysian financial
concept of the fee-based advisory
Negara Malaysia.
134
It has provided some guidelines for
there is pressure from the regulator,
FPAM Boards policy making body, so
the insurance industry, for instance,
explains Foo.
he expects little change from FPAM.
enabling product providers to place
What needs to happen is more com-
The Association of Financial Advisors
non-commissioned products either
petition, whether in the form of local
(AFA), meanwhile, claims to represent
online or through bank branches.
or overseas institutions, adds Foo.
the intermediaries and stand between
Then there will be more emphasis by
the customers and the product provid-
the regulators in terms of advice.
ing institutions.
incurring commissions, individual cus-
He points to the examples set by the
There might be a credibility issue
tomers now have more flexibility.
regulators in markets like the UK and
here, explains Foo, because AFA
the US, which has been intent on
was started by long-time life insur-
driving changes in the industry.
ance agents. So their perspective
by introducing a scorecard system and
This means instead of buying insurance

products through tied agents, therefore
Meanwhile, the Employees Provident

Fund (EPF) is trying to build its own fi-
could be more skewed towards life
nancial planning arm, to employ advisers
Where there is more activity from the
insurance than the whole financial
within its payroll to give advice to people
Malaysian regulators more recently is
planning profession.
on how to invest their EPF money.
in the fintech space, as the authorities

At the same time, however, he explains that some of these advisers are
starting to see the importance of independent advice.
When the public is more educated, then they

will start to demand it, as they can see the
various options and things that are
happening all over the world.
TAKING A BOTTOM-UP
APPROACH
If a top-down approach seems to be
unlikely for the time being in Malaysian wealth management, a bottom-up
effort based on educating the public
seems to be more feasible.
Indeed, there is a pressing need for
RELUCTANT TO CHANGE
want the financial services industry
practitioners at all types of institutions
Reforms have not happened in any
to be prepared for the threat from
to help investors understand and ap-
notable way at the moment, mainly
potential disruptors.
preciate what choices are available to

them to buy.
due to the fact that the market is made

up of a few dominant institutions and
A CREDIBILITY ISSUE
their tied distributors, with a lack of
It is also not very practical to rely on
And this is not just from a Malaysian
competition to change the status quo,
the various industry groups and rep-
perspective; they should be looking
explains Foo.
resentative associations across the
at opportunities globally.
country to lead the necessary changes,

Further, it is unrealistic to expect any-
based on what Foo describes as a
When the public is more educated,
thing far-reaching in terms of an en-
conflict of interest issue.
then they will start to demand it, as

they can see the various options and
tirely new approach from the banks

and the dominant institutional product
While the Financial Planning Associa-
things that are happening all over the
manufacturers in this area.
tion of Malaysia (FPAM) might seem
world, explains Foo.
a natural vehicle to drive reforms, Foo

This will most likely only come about
says that many of the incumbent in-
Then I think the regulators will prob-
when the public demands it, or when
dustry representives dominate the
ably move a bit faster.
135
FEATURE ARTICLE
Re-igniting the revenue engine

Wealth managers have found it tougher than ever to make money in the first half of
2016. But beyond just proposing new investment strategies for clients, they need to
drive needs-based conversations to adapt and provide a more relevant offering.
Amid stagnant transaction volumes and

low risk appetite, more than ever wealth
managers need to approach the conversations with clients with much more of
a longer term and diversified mind-set.
Their focus should be to develop a
Many clients appreciate

fee-based pricing as it is
simple, transparent and
aligns interests.
better understanding of client needs

and expectations to adapt the offering
and recommended asset allocation.
Risk appetite is much lower than last
PAUL STEFANSSON
year. Advisers should adapt to that environment and not try to sell risky products that clients do not want, suggests
Arnaud Tellier, head of investment
services for BNP Paribas Wealth Management in Asia Pacific.
EVOLUTION
Against this backdrop, banks need to
Risk appetite is much lower than last year.

Advisers should adapt to that environment.
enhance the offering for their clients.

This can be done in various ways both
in terms of the assets and solutions they
of conversations and approaches to
At UBS Wealth Management, Paul Ste-
make available, as well as via the types
portfolio management taken.
fansson, head of IPS portfolio specialists
136
A UNIQUE VIEW
ON GLOBAL
INVESTING
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takes a truly global perspective. Ours comes from
over 600 investment professionals on the ground
across more than 25 countries. Put our expertise
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to the specific objectives, financial situation or needs of any particular person who may receive it. The value of investments and the income
from them can go down as well as up and you may not get back the full amount that you invested. Past performance is not an indicator nor
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FEATURE ARTICLE
in Singapore, says the focus this year

has increasingly been on giving clients
greater access to all kinds of alternative
investments, such as private equity.
UHNW individuals need more than
just traditional banking services, he
explains. It is important that we can
provide them with a mix of investment
banking, asset management and
wealth management.
Risk appetite is much

lower than last year.
Advisers should adapt to
that environment and not
try to sell risky products
that clients do not want.
ARNAUD TELLIER
At the same time, UBS will soon offer

mandate portfolios that utilise higher
weights in illiquid asset classes. This
is a common strategy for certain wellknown endowment funds and investors with longer time horizons, explains Stefansson.
The right investment strategy must
inevitably take into account the fact
The wealth management industry in Asia is

going through a profound change in terms of
how we will charge for our services.
that asset allocation and diversification

are key to ensuring stable positive
returns, adds Tellier. Expected returns
have to be adjusted to current market
According to Jean Chia, head of equities
Challenging markets inevitably put the
frequent portfolio reviews are advisable.
advisory and sales at Bank of Singapore,
spotlight on the service and product
creating a structured investment
proposition. From a distributors per-
OUTCOMES AND NEEDS
process, with after-sales delivery is one
spective, this is where it is important
of the ways to make the engagement
for them to ensure that product provid-
with investment solutions more sticky.
ers can deliver on what they need.
environment. Plus, he explains, more
To really be able to determine which

investment solutions are best suited to
todays environment also depends on
the ability of advisers to have more
needs-based conversations with clients,
and create outcome-focused portfolios.
This is starting to happen in some segments. The wealth management indus-
WHAT WILL FINALLY DRIVE CONVERSATIONS WITH CLIENTS TO

BE MORE NEEDSBASED?
16%
21%
RMs being beer educated

to sell these soluons
Regulatory-led reforms
try in Asia is going through a profound
Changes in incenve structures
change in terms of how we will charge

for our services, says Stefansson. At
29%
UBS, we see increasing client interest

in fee-based, as opposed to commission-based, pricing models. In his view,
many clients appreciate fee-based
pricing as it is simple, transparent and
aligns interests.
138
Beer plaorms and

infrastructure
More client educaon
21%
13%
Source: Hubbis Investment Solutions Forum 2016
DELIVERING EXCELLENCE IN
ASIAN INVESTMENT
Hubbis_A4_July16_WIP.ai 1 28/7/2016 11:21:01 AM
DELIVERING EXCELLENCE IN
ASIAN INVESTMENT
At Fullerton, our understanding of the region comes from more than just
analysis and statistics: we embrace the dynamism and energy of Asia. As
committed long-term investors, we see quality beyond the trends. Our recent
awards demonstrate the results.
At Fullerton, our understanding of the region comes from more than just
analysis and statistics: we embrace the dynamism and energy of Asia. As
committed long-term investors, we see quality beyond the trends. Our recent
awards demonstrate the results.
Best Fixed Income House

2016 Morningstar Singapore
Fund Awards
C
CM
MY
CY
CMY
Best SGD Bond Fund

The Edge-Lipper Singapore
Fund Awards 2016
Best Fixed Income House

2016 Morningstar Singapore
Fund Awards
Best SGD Bond Fund

The Edge-Lipper Singapore
Fund Awards 2016
Best Local Currency Bonds

Best Hard Currency Bonds
Best China Offshore Bonds
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Local
Currency Bonds
2016
AsianInvestor
Best
Hard
Currency
Bonds
Asset Management Awards
Best China Offshore Bonds
2016 AsianInvestor
Asset Management Awards
Best Fund Manager, Singapore

Hard Currency Bonds, Asia Pacific
Best Fund
Citywire
AsiaManager,
AwardsSingapore
2016
Hard Currency Bonds, Asia Pacific

Citywire Asia Awards 2016
Best RMB Bonds, Offshore

Asia Asset Management
Best
Bonds,
BestRMB
of the
BestOffshore
Awards 2015
Asia Asset Management

Best of the Best Awards 2015
fullertonfund.com
fullertonfund.com | +65 6828 6100
info@fullerton.com.sg
info@fullerton.com.sg | +65 6828 6100
Source: Citywire,
Morningstar,
Lipper,Lipper,
Asia Asia
Asset
Management.
Awards 2016
2016 Morningstar,
Morningstar,
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Reserved.
Thomson
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Morningstar,
Asset
Management.Morningstar
Morningstar Awards
Inc, Inc,
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Reserved.
Thomson
Reuters Lipper
2016
Thomson
Reuters.
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Rights
publicationisisforfor
information
All applications
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beonmade on
ReutersAwards
Lipper Awards
2016
Thomson
Reuters.
RightsReserved.
Reserved. This
This publication
information
only.only.
All applications
must be
made
the application
form accompanying
the prospectus,
which
can
FullertonFund
Fund
Management
Company
Ltd (Fullerton)
the application
form accompanying
the prospectus,
which
canbebeobtained
obtained from
from Fullerton
Management
Company
Ltd (Fullerton)
[UEN: [UEN:
200312672W]
or its approved
distributors.
Investors
should
readthe
theprospectus
prospectus for
investing.
TheThe
valuevalue
of units
or shares
in the Fund
200312672W]
or its approved
distributors.
Investors
should
read
fordetails
detailsbefore
before
investing.
of units
or shares
in the Fund
and the accruing
income accruing
the units
or shares,
if any
may
rise.Past
Past performance
performance isisnot
indicative
of future
performance.
This
and the income
to the to
units
or shares,
if any
may
fallfallororrise.
notnecessarily
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This
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was, prepared
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to the
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investmentobjectives,
objectives, financial
or or
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of any
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Investors
may wish
publication
was, prepared
without
regard
to the
specific
investment
financialsituation
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needs
of any
investor.
Investors
may wish
to seekfrom
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from a financial
adviser
before
making
a commitmenttotoinvest
invest in any
event
thatthat
investors
choose
not to not
seektoadvice
to seek advice
a financial
adviser
before
making
a commitment
anyFund.
Fund.InInthe
the
event
investors
choose
seek from
advice from
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investors
should
consider
whether
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a financial adviser, investors should consider whether the Fund is suitable for them.
FEATURE ARTICLE
For Stefansson, meanwhile, it is impor-
Creating a structured
investment process, with aftersales delivery is one of the
ways to make the engagement
with investment solutions
more sticky.
JEAN CHIA
Bank of Singapore
tant to understand the value-add that

comes from doing thorough due diligence on products.
More specifically, adds Tellier, the differentiator stems from a particular
banks capacity to the source the right
product, using the right due diligence,
to understand where and how the
product is being packaged. The banks
advisers must also ensure clients understand this as well.
According to Marc Lansonneur, managing director and head of the Singapore

wealth investment & treasury business
at DBS Bank, after-sales service is a
As something happens to the underlying, we need useful

information to pass on to our RMs as well as clients.
key component.
It is easy to price a transaction and
book a trade, but as soon as something
happens to the underlying, we need
useful information to pass on to our
RMs as well as clients, he explains. We
do some of this ourselves, but we also
look to our operators to advise on
whether clients should for example take
While product innovation isnt top of
profit or switch.
the list for all distributors, this can be

important in helping to improve inves-
He adds that the bank will increasingly
tor returns. This is especially the case
assess partners on such services.
if it leads to greater access to unique

products, adds Stefansson, in particular
in terms of alternative investments.
WHICH OF THE FOLLOWING SHOULD BE THE MOST IMPORTANT

THING DISTRIBUTORS LOOK FOR FROM PRODUCT
MANUFACTURERS?
42%
5%
STRATEGIES FOR UNCERTAIN

TIMES
From an investment perspective more
Lower prices
specifically, given the nature of markets
Product innovaon
today, many clients are increasingly
Aer sales-service
Informaon and educaon
taking a wait-and-watch, more tactical

approach.
This includes investments which are
32%
140
21%
non-correlated.
In addition, with so many over-crowded trades in the market across fixed
income, developed equities and emerg-
AV I VA I N V E S TO R S
For specific investor outcomes
At Aviva Investors, we believe its time to think

differently. Thats why our entire organisation
is united behind one common goal to deliver
the specific outcomes that matter most to
todays investor. By harnessing the exceptional
breadth and depth of our global resources,
we cut a path through complexity to focus on
the specific outcomes our clients need.
Visit avivainvestors.com
or call +65 6491 0560
investor outcomes
Sustainable Income | Capital Growth | Beating Inflation | Meeting Liabilities
For todays investor
Except where stated as otherwise, the source of all information is Aviva Investors Global Services Limited (Aviva Investors). Unless stated
otherwise, any opinions expressed are those of Aviva Investors. They should not be viewed as indicating any guarantee of return from
an investment managed by Aviva Investors nor as advice of any nature. This advertisement is prepared by Aviva Investors Global Services
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Asia Pte. Limited does not provide any independent research or analysis in the substance or preparation of this advertisement. Aviva
Investors Asia Pte. Limited, a company incorporated under the laws of Singapore with registration number 200813519W, holds a valid
Capital Markets Services Licence to carry out fund management activities issued under the Securities and Futures Act (Singapore Statute
Cap.289) and is an Exempt Financial Adviser for the purposes of the Financial Advisers Act (Singapore Statute Cap.110). Registered Office:
One Raffles Quay, South Tower #27-13, Singapore 048583.
20150811_02
FEATURE ARTICLE
ing market equities some contrarian
clients to use more passive instruments
trades can offer good opportunities.
in their portfolios.
Building robust portfolios
An uplift in returns is also possible
The region still trails the US and Europe
through alternatives such as private
in this way, given that Asian investors
equity and real estate, to take advantage
still believe they can do stock-picking
of dislocation in the markets or dis-
and out-perform the markets without
counted assets.
too much difficulty.
One of the key ways to build

a robust portfolio for clients is
based on the recognition that
the world is a lot more complex
and volatile than before.
To be able to get through this uncer-
By contrast, pension funds, for example,
tain period, buying some simple put
have for a long time had a core alloca-
options can also make sense, as do
tion to passive investments.
hedging strategies.
This is due to the benefits of such instruMore broadly, structured solutions
ments: they can help portfolio construc-
should continue to play an integral role
tion and management in various ways
in client portfolios not really for
such as transition management, liquid-
speculative purposes, but rather to
ity management, managing portfolio risk
protect portfolios and get access to
and managing portfolio costs.
markets which investors might not otherwise be able to reach.
In reality, it is possible to construct a

very good portfolio with passive invest-
GOING PASSIVE
ments so, in fact, this part of the
There is also increasing scope for Asian
process is active.
Having a very dynamic risk management strategy in place

is essential; this means that as risk changes, the portfolio
adjusts so that it is still optimal for the investor.
WHAT IS THE MOST IMPORTANT INVESTMENT THAT BANKS NEED

TO MAKE TO ENSURE A MORE SUCCESSFUL DPM OFFERING?
28%
For example, a robust portfolio

refers to one that can take
into account current zero
and negative interest rates. It
must also be able to deal with
unexpected potential events,
such as how QE will end.
There are also new approaches
for managers to consider as part
of portfolio construction.
These include factor-based
strategies, to build a more
diversified portfolio which is
not as sensitive to one or two
specific underlying factors.
Another important trend relates
to the importance of cost as
part of the process. This is being
driven by regulation around the
world
Educaon of RMs
Educaon of clients
Porlio /
investment specialists
16%
So having a very dynamic risk

management strategy in place is
essential; this means that as risk
changes, the portfolio adjusts
so that it is still optimal for the
investor. This is a big departure
from traditional portfolio
management theory.
56%
MAKING DISCRETIONARY
OFFERINGS WORK
Todays market landscape also highlights
the importance of managed accounts
and DPM.
This is because the relationship between
142
bankers and end-clients is one where
FEATURE ARTICLE
But the most expensive component of
To speed up the
penetration of DPM
requires a move towards
performance-based fees.
the production chain is sales. Portfolio

specialists, director/executive/senior
director level individuals must be available to support the front-line adviser
to sell this more complex solution. To
make it work, it is key for banks to build
the right tools and have the frameworks
in place.
MARC LANSONNEUR
DBS Bank
At the same time, adds Lansonneur, to

speed up the penetration of DPM requires a move towards performancebased fees.
there must be fiduciary oversight and

an ongoing relationship. For example,
during the financial crisis in 2008, many
WITH SO MUCH VOLATILITY AND UNCERTAINTY

WHAT SHOULD ADVISERS FOCUS ON WHEN DISCUSSING
INVESTMENTS WITH CLIENTS?
advisers realised it presented an opportunity to talk regularly to clients

about the re-allocations in their portfolios as re-balancing took place.
7%
And since 75% of the performance of
folios, it is during such challenging times
36%
that clients can see the value of DPM

especially in terms of the diversification and risk monitoring, says Juan
Aronna, managing director and head of

investment and products for RBC
Wealth Management in Asia.
DPM becomes more relevant in challenging and volatile times and in the
case of black swans, he adds.
So in line with this, and the fall in trans-
DPM becomes more

relevant in challenging
and volatile times and in
the case of black swans.
action revenues, banks need to look at

the way they address the challenges in
technology along with due diligence
and oversight, to present their infrastructure and train their bankers, to
make DPM a more fulfilling and transparent experience for clients.
144
Diversifica on benefits to
the por olio
Ease of explaining the
strategy to clients
average advisory portfolios in a private

bank under-perform discretionary port-
57%
Performance and track record
JUAN ARONNA
RBC Wealth Management
EXPERT INSIGHTS
Physical gold: are you ready?

A low-yield environment should remind investors of golds role as a safe-haven
investment. But wealth managers and investors should also consider physical gold, says
Seamus Donoghue of Allocated Bullion Solutions.
Gold has always been a favourite asset
the domestic economy, capital out-
class for many Asians, particularly
flows and the depreciating currency,
among the Chinese and Indians, serving
explains Donoghue.
as a safe heaven.
STICKY BUSINESS
Data from the World Gold Council
Despite these market signals, not many
shows that since the 1970s, precious
banks do much business in physical
metals have had an average of 63
gold, given its relatively complicated
months worth of bull markets, with an
trading process.
average cumulative return of 385%.

Yet Donoghue believes that these inThis compares with 42 months worth
stitutions would find that it pays off in
of bear markets, with a negative return
the long run.
of 44%, says Seamus Donoghue, chief

executive officer of Allocated Bullion
For instance, he says that physical gold
Solutions.
custody has no capital or leverage

impact on the banks; this is because
Meanwhile, among many asset classes,
the physical gold does not sit on the
only gold has experienced more than a
banks balance sheet.
SEAMUS DONOGHUE
15% return in the first quarter of 2016.

Meanwhile, banks can enjoy a stickier
The demand for gold as a safe-haven
AUM, adds Donoghue, explaining that
investment is also growing in China,
the majority of the gold that gets bought
custody fees and high transaction fees.
for example, happening against the
sits with the banks. What this leads to
Plus, it is a differentiated offering to
backdrop of the uncertainties over
for the banks, he explains, are recurring
show clients.
146
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EXPERT INSIGHTS
Giving clients the product

proposition they want
Lavanya Chari of Deutsche Bank Wealth Management is a staunch believer in
working with clients to meet their shorter and longer term needs not fitting
everyone into the same bucket.
With the potential to access the relevant
sify the product offering is high on the
suite of products from the investment
agenda. It all stems from an approach
banking side of its business and various
which is about having conversations
counterparties across the street,
with clients to help them meet their
Deutsche Banks wealth management
needs whether these are short-term
business is confident that it has weath-
or long-term in focus.
ered the storm over the last 12 months

better than many of its peers.
REFRESHED
The goal for the more forward-looking
We have focused on a few different
private banks is to continuously enhance
things, says Lavanya Chari, head of global
the value proposition and suitability
products and solutions at Deutsche Bank
framework for their product offering.
Wealth Management in Asia Pacific. One

is capital markets, which is our bread-
There is no question in Charis mind that
and-butter business. And we have made
this involves refining the mix.
a concerted effort to grow the accruals

business, both from a funds perspective
This is what we are in the process of
and from a discretionary portfolio man-
doing, she says. For example, we are
agement standpoint.
focusing more on discretionary portfo-
LAVANYA CHARI
lios. We are also making a concerted

At the same time, she adds that in terms
effort to expand our alternatives offering
of structured products, credit-linked
to clients to give them access to oppor-
notes have been a big success story for
tunities they otherwise wouldnt get.
the street, from which it can develop

bespoke alternatives products. For in-
the private bank. But the bank has much

more to offer. And going forward, Chari
This is based on the banks relationships
stance, it works with managers to create
explains that continuing to try to diver-
with pretty much all the fund houses on
feeder funds to essentially give clients
148
Aiming to be the best,

not the biggest.
With capacity-restricted equity funds and experienced

fund managers given intellectual freedom in an
entrepreneurial environment, our accent is on
performance.
Visit us at www.johcm.co.uk or contact our Asian Representatives
Andrew Ang
Director of Asian Sales

+65 6511 6313
aang@johcm.com
Grace Se
Client Service Manager

+65 6511 6303
gse@johcm.com
JOHCM (Singapore) Pte Ltd
138 Market Street, #15-04 CapitaGreen, Singapore 048946

Tel: (65) 6511 6300
Fax: (65) 6511 6319
London - Singapore - Boston - New York
J O Hambro Capital Management Limited (JOHCML) is an investment boutique authorised and regulated by the UKs Financial
Conduct Authority. JOHCM (Singapore) Pte Ltd is a wholly-owned subsidiary of JOHCML and regulated by the Monetary Authority
of Singapore (MAS).
EXPERT INSIGHTS
the ability to invest smaller amounts
lio to a private bank, so the ability to trade
shouldnt impact the long-term rela-
into funds that would not be accessible
FX, equities and other products they have
tionship with the RM.
to them otherwise. Private market op-
a view on becomes the priority.

Our top RMs have known their clients,
portunities are also in focus, involving

sourcing opportunities for clients.
Even though the bank might give them
and often their families, for 15 years or
its house views and access to its product
longer, and they do will not do anything
A further change is likely to come in
suite, they simply wont relinquish
that would negatively impact the client,
terms of the bank doing more on the
control. To Chari, this highlights the
she explains.
digital front. This is a significant focus
stark difference between what happens
area for us, explains Chari. The way
in Germany and in Asia. These are the
According to Chari, the need for broader
clients look at their money has changed
two extremes, and I have several con-
and more open conversations with
because the world has changed, so we
versations with my counterpart in
clients is also a key way for private banks
are working on several initiatives to try
Germany where he wants to make his
to provide more value.
and take this business to the next level,
business more like mine, yet I want to
including portfolio analysis plus our
make mine more like his.
internal straight-through processing to

bring down costs.
Clearly we speak to them about the

markets and the product offering across
Yet while the goal is to take the best-
different asset classes, but we also have
in-class from both sides and try to
conversations with clients around their
More specifically, the bank is building a
combine them, the reality is that the
personal situations, she says.
tool which looks at a clients portfolio
penetration of discretionary mandates
and the extent to which it deviates from
in Asia, for example, will continue to be
This ranges from discussing setting up
the model portfolio based on the clients
limited relative to Germany for the
trusts, to children getting married, to the
agreed risk appetite and requirements.
foreseeable future.
possibility of divorce, to insurance. We
RMs can then discuss this with each
work on every aspect of the clients fi-
client on a regular basis, to determine
The fundamental difference in attitudes
nances and business dealings, she adds.
if thats what they want in the short
and needs of Asian clients is exactly why
We have a wealth planning team whole
term, or if they want to move back to
Chari believes relationship managers
focus is on the clients best interests.
their ideal, or model, portfolio.
(RMs) must have bespoke conversations

with the client rather than try to
BROADENING THE OFFERING
THE RIGHT CONVERSATIONS
squeeze them into a mind-set which just
UHNW clients have been one of
A lot of the time and energy the bank
doesnt seem to fit.
Deutsche Banks key focus areas over

the last several years.
is spending to evolve in these ways is

also for the purpose of facilitating more
Many Asian clients want returns. They
needs-based conversations between
do not want returns only in 20 years
This is driven by its capabilities across
front-office advisers and their clients.
time; they want them annually.
different products and asset classes.
We need to offer clients more of what
As a result, she believes that, in addition
We have every single aspect of the
they need, acknowledges Chari. Some
to a long-term portfolio, it is equally the
product suite, across the spectrum,
clients will definitely want funds, so
fiduciary responsibility of the adviser
which very few other banks do, ex-
those are the individuals to whom the
to try and meet all client needs. It may
plains Chari.
bank will offer managed products and
not be possible every single year to
discretionary portfolios, she says.
achieve the desired returns, based on
In addition, the bank is now targeting
market conditions.
the broader HNW client segment in

Asia. In line with this, the bank is working
Then there are other clients, such as the

young entrepreneurs in some countries
And even where there is a short-term
now on improving its systems as well as
in Asia, for instance, who are unlikely to
focus by clients for a specific investment
its processes, to service this larger group
cede supposed control over their portfo-
or part of their portfolio, this doesnt or
of clients.
150
External
Wealth Management
Platform
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EXPERT INSIGHTS
How Citi is enhancing its

advisory offering
Paul Hodes explains how Citi is enhancing its advisory offering to clients in the region,
as well as improving the education of staff to drive more needs-based conversations.
A huge amount of work has been under-
The CDI measures portfolios in terms
way within Citi to raise the level of
of how they are placed versus the rec-
advice it provides for its clients, says
ommended model portfolio and the
Paul Hodes, head of consumer bank,
underlying holdings, says Hodes.
wealth management in Asia Pacific, in

an interview.
It also tests potential concentration risk

in terms of the extent to which clients
For the banks HNW segment, for
portfolios are diversified across geog-
example, they now get in-depth and
raphies and sectors, for instance,
analytical tools to review their portfolios. This aims to help them to deepen
EDUCATING STAFF
their understanding, not only their hold-
To better educate its front-line staff,
ings, but also of the extent of the diver-
Hodes says Citi works exclusively with
sification of their portfolios.
the Wharton School of the University

of Pennsylvania, in terms of training.
The Citi advisory process has led to
The goal is to deepen the understanding
strong sales and earnings, says Hodes,
of wealth management and relationship
along with positive client feedback.
managers (RMs).
PAUL HODES
Citi
Advice can lead relationships in terms

of deepening understanding, and ulti-
So when recommending a product, this
mately driving the companys business.
should help the RMs understand what

the academic research is behind it.
For the banks affluent customer base,
When we talk about portfolio or
RMs need to get into a more sophisti-
the Citigold Diversification Index (CDI)
manager selection, about diversifica-
cated level of conversations with clients
is a simple tool to help clients better
tion, or about risk versus returns, try to
to provide ideas to them, and the tools for
understand their portfolios.
think about what they really mean.
them will help to educate clients too.
152
EVENT HIGHLIGHTS - INVESTMENT SOLUTIONS FORUM 2016 - JUNE
Finding investment solutions

for challenging markets
Amid highly-challenging markets, product manufacturers and distributors urgently
need to get clients to use a broader range of portfolio and investment solutions. In
particular, diversification and risk management are critical.
In todays uncertain investment envi-
banks, multi-family offices and IFAs, as
ronment, listening to clients to under-
well as relationship managers and in-
stand their needs and present diversi-
vestment advisers from the industry.
fied portfolio solutions to them will

differentiate the winners and losers.

There are clearly many uncertainties in

todays investment markets. For
Indeed, against the backdrop of what
example: Brexit discussions, oil prices,
seems to be the toughest year for a long
US Fed interest rate hikes, Chinas
time for wealth managers to make
growth issues, and more.
revenue product manufacturers and
Franklin Templeton
Investments
iShares
Leonteq Securities
STRATEGY Consulting
Commerzbank
Morningstar
distributors must guide clients to use a
As a result, the focus needs to be on
broader range of investments which are
diversification of risk and also the re-
more suitable and relevant.
balancing of portfolios.
In line with this, we designed and hosted
At the same time, it seems that what-
managing portfolios today is also to
our new-format, investment-focused
ever assumptions that investors might
continue to move in the direction of
event in Singapore in June 2016.
have about the past might not be rel-
removing the responsibility for making
evant for the future.
investment decisions from the end-
An important consideration when
This brought together 275 senior indi-
clients to the investment specialists
viduals including leading product &
Advisers therefore need to question
whether via a discretionary portfo-
fund gatekeepers from the top interna-
their assumptions before building port-
lio management (DPM) model or
tional and local private banks, retail
folios for their clients.
another format.
Advisers, as part of more outcomeoriented and needs-based conversations with cleints, also need to re-align
client expectations in terms of returns
and performance with what the market
is actually offering.
There is, in general, a need to think
longer term which, ultimately, should
mean the longest time period which the
individual client can stomach.
154
Akshay Prasad
Anthony J. Harper
Arnaud Tellier
Arthur Wu
Christophe Aba
Managed Accounts Partners
Morningstar
JPMorgan Private Bank
Conrad Huber
Dr Ekkehard J. Wiek
Emmanuel Guillaume
Franck Fayard
Harold Y. Kim, Ph.D
Straits Invest
Commerzbank
Neo Risk Investment Advisors
Hrishikesh Unni
Jean Chia
Juan Aronna
Juerg Kiener
Leonardo Drago
Taurus Family Office
Bank of Singapore
Swiss Asia Capital
AL Wealth Partners
Marc Lansonneur
Nicolas Rigois
Pankaj Nagrath
Paul Stefansson
Prashant Bhayani
DBS Bank
Standard Chartered
Barclays
Roger Meier
Steven Moeller
Simon Ip
Stanley Sia
Tuan Huynh
Bank Julius Baer
BlackRock
Indosuez Wealth Management
155
Chinmay Patil
Christian Obrist
Patrick Donaldson
Sally Kwok
Scott Collinson
Leonteq Securities
BlackRock
Thomson Reuters
BlackRock
The event attracted a very good turnout, and with a good

cross-section of speakers. So with a large number of people
from diverse streams attending and sharing their views, this
is a great experience for everyone.
Rohit Jaisingh, Head, Equity and Commodities Investment Products, DBS Bank
Rohit Jaisingh
DBS Bank
156
EXPERT INSIGHTS
Getting onto a banks funds

distribution platform
Given the dominance of banks in Asia in distributing mutual funds, Stewart Aldcroft
of Citi reveals what asset managers must do to get approved onto a banks platform,
and how to avoid getting kicked off.
Banks have a dominant position in
Performance is also critical, given the
terms of distribution of funds in Asia.
desire among banks for best-of-breed.
In Hong Kong, Singapore and Taiwan,
Consistency of returns over three and
for example, banks represent more than
five years is key, as is having the same
80% of all mutual funds sales.
manager for these time periods, following a repeatable and definable invest-
According to Stewart Aldcroft, manag-
ment process. This should create dif-
ing director of Citi Markets & Securities
ferentiated alpha to appeal to the bank.
Services, and a senior advisor in the

Asian fund management industry, fund
For pricing, standard funds have a front-
houses must adhere to some specific
end load but often 5% is fully rebated/
criteria in line with the distributors
discountable. They also need annual
clearly-defined processes to get their
management fees with trail commission
product on the platform.
to create annuity fees for the banks.
THE 4Ps
When it comes to people, local represen-
Product is often the most important one,
tation is necessary, as is responsiveness
explains Aldcroft.
in terms of any follow-up on enquiries.
Some key features include being de-
Once on a platform, Aldcroft says funds
nominated in US dollars, although RMB
must be careful not to get de-selected.
is increasingly sought after by mainland
STEWART ALDCROFT
Citi
against the benchmark index and peer
investors. Further, UCITS (Luxembourg
This might happen due to: the departure
group; corporate risk; capacity constraints;
or Dublin) is preferred, and an AUM of
of the fund/portfolio manager; style drift;
and transparency of fund, manager or firm
USD500 million-plus is ideal.
poor risk controls; under-performance
in providing information.
157
EXPERT INSIGHTS
Making the switch from

products to portfolios
Bank distributors are working hard to align their models with the goal of having
needs-based conversations with customers. But matching intention with the reality of
delivering longer term portfolio advice is a challenge that requires support from their
funds partners, says Damien Mooney of BlackRock.
Many of the larger bank distributors in
business in Asia Pacific. But it is very
Hong Kong and Singapore have made a
much early days.
concerted effort over the past couple

of years to head in the direction of more
Ultimately, he adds, there is some
of a portfolio advisory approach. Their
dynamic tension between what the
goal is to genuinely focus on a custom-
banks are trying to achieve versus their
ers needs as the basis for the invest-
ability to execute it.
ment conversation.
HARD TO DO IN PRACTICE
The efforts to move in this direction are
One of the biggest impediments to these
particularly noticeable within those
banks moving from being product-led
private banks which are determined to
sales organisations to being able to offer
try and increase their discretionary busi-
a portfolio advisory proposition, is the
ness, beyond the mainly single-digit
client base itself. Not all of them want
AUM in such mandates today.
to actually be advised, says Mooney.

Many of them prefer to have a trans-
If you talk to the senior management
actional relationship with their RMs.
DAMIEN MOONEY
BlackRock
in these organisations, they say they

have changed their models, that their
Time is also not on the banks side.
RMs are no longer incentivised on
Changing the nature and focus of the
revenue per se, that they have got a bal-
conversation is also difficult amid an
anced scorecard among a mix of KPIs,
environment where regulation on giving
and that every part of the advice process
advice is so onerous.
process, they default to talking to the

customer about something they can
is centred on a needs-based conversation, says Damien Mooney, head of
As a result, rather than an adviser
buy in less time and without as much
BlackRocks retail and wealth advisory
spending up to two hours on this
paperwork required.
158
Another hurdle for the banks in making
I would imagine that 10 years from now,
a portfolio, needs-based approach work
everything will be much more transpar-
is the dependency on having skilled RMs
ent, says Mooney.
and portfolio account managers.

In addition, portfolio-wise, services will
This is where some banks have been
essentially be standardised using tech-
found wanting.
nology, and, in some instances, productbased commissions will have disap-
RM turnover remains high, so the banks
peared. he adds.
ability to develop more of a portfolio

service at a cost they can maintain is a
TRUE PARTNERSHIP
challenge, says Mooney.
In bank distributors trying to move

towards a more sustainable model, fund
AGAINST THE TIDE
houses can help them.
None of these factors are deterring

Asias wealth management industry
One of the things that BlackRock aims
from trying to effect change.
to do in line with this, is have a genuinely differentiated relationship with
The pressure to create more sustain-
its distribution partners.
ability in the advisory model is increasing. This is coming not just from the need
We dont want to be regarded as just
to make the economics of the business
another product provider, says Mooney.
work better, but also from the spotlight

on fee transparency which Mooney
Three or four years ago, our main rela-
believes is only going to get brighter.
tionship with these firms was mutual

funds based. Today, we have a very differ-
There is definitely more connectivity
ent relationship as a result of the breadth
among regulators around the cost of an
of our product and advisory capabilities,
advice-based conversation, he says,
he explains.
and there is much more focus by investors in todays low interest rate, low
For example, BlackRock is making its
return environment on what they are
ETFs available inside the banks discre-
getting for their money.
tionary portfolio teams, plus the firm is

doing much more model portfolio busi-
He also foresees the next five to 10 years
ness in some cases providing asset
as going to be arduous.
allocation services.
The cost pressures are not abating
On top of this product proposition, the
within the industry, with revenues
value-add comes from the firm helping
coming under significant pressure. The
with education, training and also, po-
squeeze is certainly on, he explains.
tentially, with distribution.
It is those incumbents in the industry
More specifically, this might involve
which can migrate to a model where
conversations about how these dis-
they will be able to offer the services
tributors can evolve their business using
that scale, and at a lower cost, which will
various technologies to make it more
win in the long run.
focused on portfolio advice.
Looking onshore
For fund houses looking to
capitalise on the opportunities
in Asia, and not get caught up
doing the same as everyone else,
they need to look onshore.
Thats where the growth
potential is, says Mooney. For
international asset managers
with any medium to long-term
ambition in this region, and
which want to build scale, they
cant be a foreign company. They
can be international, but they
cant be foreign.
This means they need to put
down roots in markets where
they see growth. To do this
successfully requires them to
determine how they can make
themselves relevant.
And that wont only be through
selling offshore funds.
As a result, the historical
approach of importing an
offshore fund range from Dublin
or, predominantly, Luxembourg,
into Asia, is no longer enough.
For Mooney, two simple facts say
it all about the potential from
the vast amount of untapped
wealth onshore: an average cash
balance among Asian investors
of four or five times that in
the West, yet a much lower
percentage of their investments
being in managed funds.
Over time, I think we will see
a greater move into managed
investments, mutual funds and
ETFs, he predicts. Thats going
to come from cash and from
wealth accumulation. And just
having offshore funds wont
be enough.
159
EXPERT INSIGHTS
Why bank distributors must

re-tune product platforms
Intermediaries in Asia are grappling with how they adapt their product offering and
position investment strategies to end-clients in todays environment. June Wong of
State Street Global Advisors explains the role that fund houses can play.
The influences of challenging invest-
The old model of engagement cannot
ment markets, relatively low fund
continue. There should be a better way
penetration and regulation such as fee
of serving clients.
disclosure are driving a much-needed

transformation in product platforms
To do this in practice involves them
at private banks in Asia.
increasingly looking at passive instruments, such as ETFs, smart beta strat-
Over the past 20 years, the dominant
egies, and outcome-oriented invest-
model of client engagement has been
ment solutions.
to use thematic and active strategies,

generally via stand-alone products.
A FULL MENU
The move towards a broader and more
But the limited success that many
holistic product offering is inevitably
banks have had in selling funds cannot
a positive development for a firm like
be ignored.
SSGA, given its focus on active and

passive strategies.
As a result, a growing number of these

distributors are adapting and refining
On the one hand, it has a comprehen-
their approach, including leaning towards
sive range of passive and smart beta
more of a discretionary offering.
strategies, whether in the form of ETFs
JUNE WONG
State Street Global Advisors
or UCITS structures. This is compleMore and more intermediaries need
mented by the more outcome-focused
to prepare and re-invent themselves
solutions, explains Wong.
for todays world, says June Wong,
options in how it can support distributors, depending on their preferences.
head of Asia ex-Japan for State Street
At the same time, the firms active funds
Plus, SSGAs offering is global, so Wong
Global Advisors (SSGA).
and alternatives offerings give it more
says it can work with intermediary
160
partners wherever they make their
For example, she says they need to be
buying decisions.
more technical, to be able to better

understand the needs of intermediary
Further, it can either act simply as a
partners. Their role must develop
provider of individual products and
beyond that of just a relationship
solutions, or work in a more consulta-
manager, so that they can work with
tive way with a bank if they are looking
them to create more relevant solutions.
for advice and guidance on how they

formulate their asset allocation and
Modern dialogue needs to go beyond
populate the product platform.
just performance and talking about
New approaches to
investment models
The results of a recent survey
by SSGA, entitled Building
Bridges, highlights how retail
and institutional intermediaries
can access new approaches, such
as Smart Beta and objective- or
needs-based investing, to have
any chance of meeting their longterm return goals.
Some of the key findings include:
The old model of engagement cannot continue.

There should be a better way of serving clients.
In line with the stage of development
different campaigns to launch togeth-
of the industry, the current discretion-
er, she adds.
ary-focused phase requires a good

supply of underlying products to serve
This is also essential given clients now
as building blocks.
have access to more information, and

new ways of sourcing it, via a greater
In todays low-yielding environment,
variety of communication channels.
characterised by volatile markets

where the outlook for individual asset
BETTER SOLUTIONS
classes is unpredictable, asset manag-
Wong believes that more transparency
ers and investors alike have to work
driven by regulation and a portfolio-led
much harder to generate returns in
approach is a good thing for Asia, to
terms of asset allocation and being
ultimately serve end-clients better.
more efficient, says Wong.
This will steer the industry towards

more cost-effective solutions, she
PROACTIVE
explains. But it is all part of an evolu-
But the help that fund houses like SSGA
tion which will take time.
can give distributors goes beyond the

products themselves.
In particular, she sees this as having an

impact in servicing the growing mass
As part of the evolution that private
affluent and emerging HNW segments.
banks need to go through, asset management companies need to think
There is genuine growth in Greater
about the types of individuals who they
China as well as South-east Asia in
put in-front of fund gatekeepers.
terms of the middle class and mass affluent, adds Wong. They need more
We need to hire differently in terms
assistance in their investment decisions
of front-line staff, says Wong.
and portfolios.
High return expectations

institutional investors are
expecting a 10.9% return
over the next five years and
are pressed to find them
in todays lower-for-longer
environment
Need for change 97% of
respondents expect moderate
to significant change in the
industry. New approaches are
required in todays lower-forlonger return environment to
meet these objectives.
New investment approaches
investors confronting
performance shortfalls are
re-assessing their overall
investing approach to better
target drivers of performance
and to ultimately adapt to
what is believed to be the
new norm
Historically driven by asset

classes, the survey results show
that many investors are looking
to objective- and factor-based
investing to meet performance
shortfalls.
As a result, the investment
paradigm is shifting from
the top-level asset portfolio
construction perspective to
specific implementation of these
new approaches using the
efficient ETF vehicle.
161
EXPERT INSIGHTS
Driving a needs-based
conversation
Shikha Gaur of Aon Hewitt explains the role of advice in guiding expat clients in
Singapore, and explores how the role of robots in the process must push professionals
to up their game.
For many investors, the investment world
[the client] is trying to do from a longer
seems daunting and perhaps overwhelm-
term perspective.
ing when they first start to learn about

it. Then, when they consider investing
With expats in Singapore, therefore, that
outside of their comfort zone, perhaps
means digging into what has brought
in a country whose system is unfamiliar,
them to move to another country in the
yet more uncertainty creeps in.
first place. There is then a place for discussing how investments, in the context
This is exactly the type of anxiety that
of that individuals financial history, can
Shikha Gaur, executive director of wealth
help in meeting those goals.
management at Aon Hewitt, is in the

business to quell. Her clients include
A client doesnt usually have an invest-
expatriates in Singapore, and its her job
ment need, explains Gaur. They have a
to make sure theyre guided through the
purpose that they are trying to [achieve].
investment process.
ADVICE FIRST
So, whats the first step? According to
Aon Hewitt, headquartered in London,
Gaur, it shouldnt start with anything to
provides HR consulting services, cover-
do with an investment. And with her
ing talent, performance, rewards and
12-strong team, she focuses on getting
retirement solutions.
SHIKHA GAUR
Aon Hewitt
the basics right first a lesson that more

advisers in the market need to heed.
Specific to the investment business, it

deals both with individuals and corpo-
insurance requirements. We are not
Our conversation doesnt typically begin
rate clients that pay for advice. From
pushing a product, urges Gaur. We will
with investments, she explains. It starts
there, it can place funds, manage invest-
give clients the advice and they could
with something broader in terms of what
ment portfolios, or help with clients
walk away and do it themselves.
162
In this way, the firm has a clear long-term
Their other needs are simply dictated
There is a need to start teaching about
focus. It can be challenging selling fee-
by the times.
money at a younger age, she says. In
for-advice over a commission-based
schools, it could be mandatory to have
model associated with the sale of product,
We are finding that there is an increas-
which is commonplace in this market.
ing need [in Singapore] for corporates
However, Aon Hewitt is convinced that
subjects related to money.
to put in retirement plans for their em-
FINTECH IN THE MIX
ployees, says Gaur.
The reach and accessibility of financial
the value of advice will start to count
education is increasing all the time in a
sooner rather than later, despite the
As a hot topic, corporates now need to
market like Singapore, which has a well-
digital disruptors.
review any existing schemes they might
populated fintech start-up scene.
have for their employees. They are

One of the reasons for this belief, says
looking to provide equitable benefits
But when it comes to the broader goal
Gaur, is the need for education. This
for their employees, she explains.
of providing advice, robots are a bit of
has become even more important given
a way from doing the job of firms like
the complexity of the industry and
Gaur also believes there is a pressing
often limited transparency in Asia.
need to include women in retirement
Aon Hewitt at this stage.
discussions. [Women] are out of the
Saying this, Gaur does see digital-led
LONGER TERM PLANNING
workforce for reasonable amounts of
disruption as being a distinct possibil-
Working with an expat client base
time due to other commitments, she
ity going forward.
brings with it specific requirements in
says. They typically dont earn as much
terms of the advice that Gaur and her
as men in similar roles, but they have
I think [the industry] will rapidly
team need to offer.
longer lifespans.
change because, if done correctly, it

will create awareness [of the need for
advice] and people will be more savvy.
They will know what to look for, and
they will know what to ask for when
I think [the industry] will rapidly change because, if

[digital is] done correctly, it will create awareness [of the
need for advice] and people will be more savvy.
looking for the next level of advice.

As a result, professionals in the wealth
management business must make sure
they stay relevant for their customers.
As an industry, we could have mentoring programmes in place, she says.
As citizens of at least one other country
Research in 2015 conducted by Fidel-
and living in another, she says they have
ity Investments, for example, suggests
That means apprenticing up-and-coming
fairly complicated tax needs. It is critical
that women save more money than
individuals with those who have good,
that these taxation needs, along with
men; and some other studies which
old-fashioned experience, and factoring
other financial needs, are captured in
have been done point to women being
in that a good portion of customers are
an individuals investment portfolio.
slightly better at investing than men.
in the younger generations.
Now, there appears to be an increasing
Gaur stresses that retirement education
In terms of making it exciting, I think
expectation for companies to provide
needs to be universal; even someone
it is important to represent the diver-
more holistic wellness benefits - a com-
who puts aside 10% to 20% of their
sity that the industry has, adds Gaur.
bination of health, fitness and insurance
income for retirement assuming they
features, to their workforce. This is no
start this early enough can make a
In other words, there is a need to
different for the expatriate population
huge positive impact on their future
balance out greying bankers with some
in organisations.
down the road.
younger blood.
163
EXPERT INSIGHTS
No room for complacency in

distribution
In the face of volatility stemming from Chinas markets, Brexit and global economic
headwinds, Alison Brown explains how HSBCs funds division is positioning itself for
growth across the entire landscape of wealth management distributors.
Expanding and diversifying its universe
with HSBCs private bank, which is also
of distributors in Hong Kong and China
important to us, and we are slowly ex-
has been a key goal for HSBC Global
panding our presence in this segment,
Asset Management and the strategy
says Brown.
has had an increased focus since Alison

Brown came on board in mid-2015 to
BEING RELEVANT
run sales for the wholesale business in
Despite the access that Browns busi-
Hong Kong and China.
ness has to HSBCs retail banking and

wealth management, she knows never
The aim has been to expand beyond
to become complacent.
HSBCs retail banking and wealth management business albeit this remains
In line with this, the past 12 months have
the foundation distributor and integral
been dedicated to servicing the bank in
to the business. We understand the
a way that can add more value to it.
benefits of broader distribution via third

parties, explains Brown.
This goes beyond simply rationalising

the product range, which is common-
Today, it is about working with more of
place at the moment among her com-
a cross-section of firms within retail
petitors. The funds also need to be
banking, with an eye to insurance com-
competitive, and give the distributor
panies as well as third-party platforms.
what it and its customers want at a
ALISON BROWN
HSBC Global Asset Management
particular point in time, in order to fill

Plus, to capitalise on Chinas opening,
gaps they have identified.
three foreign providers of funds to

service the inbound and outbound flow
developing the cross-border business

is another key goal. Last but not least
China has been an obvious example.
of wealth is an important ambition for
is servicing the private banks. We work
For example, becoming one of the top
HSBC in the coming years.
164
We have an established network and
and fund managers, and as the firm
The teams objective is to expand dis-
an advantageous position with HSBCs
wants to be well-positioned irrespective
tribution across retail banks, insurance
presence in the retail space in both
of the market environment. If we can
companies and also on platforms that
Hong Kong and China, and work very
do a decent job in explaining our invest-
are emerging, explains Brown.
collaboratively with our joint venture
ment strategies and positioning our
partner HSBC Jintrust in China, says
funds in comparison to competitors, we
We already have the advantage to be
Brown. This plays to HSBCs strengths
have got more chance of being consid-
able to leverage HSBCs extensive
because China has a high awareness
ered in a portfolio.
network in Hong Kong and China, and

are looking to develop other distribution
of the banks brand, particularly in the

Pearl River Delta.
For example, HSBCs capabilities on the
channels to maximise our reach to cus-
fixed income side have enabled the asset
tomers, she adds.
This objective was given a boost in
manager to buck the trend of many com-
December 2015 when HSBC Global
petitors finding it difficult to attract net
The firms investment in its recent mar-
Asset Management announced its first
inflow in todays volatile environment.
keting campaign, Let Dreams Fly, also
Mainland fund in Hong Kong under the
The flagship HSBC Asian Bond fund cel-
helps in Browns distribution of funds
Mutual Recognition of Funds between
ebrated its 20th birthday in July 2016.
in Hong Kong.
quently launched its second fund in late
RELATIONSHIP DRIVEN
People can understand more who HSBC
June 2016.
Brown is very aware of the need to win
is as an asset manager a disciplined,
the Mainland and Hong Kong. It subse-
over fund gatekeepers as well as rela-
dependable, international and sustain-
The first offering, HSBC Jintrust Large
tionship managers within HSBCs target
able manager which is committed to
Cap Equity Fund, invests in Mainland
distributors.
investing clients money with care, and
China large-cap blue chips; the second
in line with their needs and expectations.
fund, HSBC Jintrust Dynamic Strategy
If you have good information and are
Mixed Securities Fund, is a multi-asset
positioned well, they understand the
With an objective to build awareness
fund which invests in mainland assets
value we can add, she explains.
of HSBC Global Asset Management,
including stocks and bonds through

dynamic asset allocation.
the campaign positions the firm as

This requires her to maintain a sharp
stewards of imagination, where the
focus on continuing to up-skill her sales
asset manager inspires people to
SERVICE UPGRADE
people, and ensure that what they give
imagine their future and invest to make
In addition to product development,
gatekeepers is relevant and consistent.
it possible whether the future imag-
Brown and her team have been working
ined is their own, that of their business
on enhancing key components of the
It has also been important for Brown
service offering. These include: speed-
to re-arrange the structure of the sales
ing up the fund houses response time
team, to ensure that business develop-
Our greatest strength is our client
to client enquiries, the quality of the
ment people are trained in all aspects.
focus: our first objective is to meet our
documentation, providing timely and
or of their clients.
clients expectations, says Brown.
targeted updates, and giving clients
So even if one of them leaves the or-
access to product specialists and port-
ganisation, the team structure enables
To do this, return is obviously impor-
folio managers.
others to have a clear understanding
tant, but just as important is how we
of existing relationships with a par-
manage our clients money. We are one
ticular distributor.
of the few global managers with the
These features, combined with the flexibility and willingness to provide alterna-
ability to understand and support ambi-
tive strategies, has created momentum
They can, therefore, ensure that gate-
tions of individuals, corporations and
with third-party distributors especially.
keepers arent subject to being ap-
institutions with a full range of financial
proached by yet another individual and
services products, services and advice
Brown says this is important since there
then having to start a conversation
that encompass todays needs as well
is a time and a place for different funds
from scratch.
as future plans.
165
FEATURE ARTICLE
Changing the rules of the

advisory game
Better advice in Asia can only come with the willingness and ability of wealth
managers to position products as solutions, drive simplicity and transparency, and
enhance client service. A focus on long-term portfolio value must replace the (continued)
tendency towards short-term conversations.
There is broad consensus among practitioners in Asian wealth management that
the industry lags the US and Europe when
it comes to providing advice to clients.
Yet there is some level of belief that
wealth managers are increasingly positioning themselves as trusted advisers
or at least realise the urgency now of
doing so.
But to achieve this requires firms and
If you incentivise on shortterm objectives you will

always have the mind-set of
short-term product push and
instant gratification from a
revenue stand-point.
ROGER BACON
Citi Private Bank
advisers to engage clients in strategic

conversations around what trusted
advice means. This needs to lead with
asset allocation and risk management,
rather than bottom-up implementation
money should be managed. They are
are able to create wealth for the client,
according to Roger Bacon, head of
looking to share their thoughts and see
maybe you have qualified yourself to
managed investments and advisory Asia
what the reaction is to verify whether
be in a position to give advice, but you
Pacific ex-Japan at Citi Private Bank.
they are on the right track or not, she
shouldnt forget that the client is the
explained at a Hubbis event in Hong
one who has created the wealth.
Meanwhile, Anthonia Hui, chief execu-
Kong earlier in 2016.
tive officer AL Wealth Partners, sug-
MORE TOWARDS THE LONG TERM
gested that rather than advice, clients
Hui also questioned the view that in-
Another challenge is the short-term
are often looking for someone to offer
vestment professionals are automati-
mentality of clients. And in line with this,
an alternative to their view of how their
cally best placed to offer advice. If you
the industry needs to work on identify-
166
they advise their clients. This approach
Clients are looking to

share their thoughts and
see what the reaction is to
verify whether they are on
the right track or not.
demands courage on the part of senior

management, adds Malik Sarwar, global
head of sales management, group
wealth management at HSBC.
Transactional RMs are not likely to be
happy, but that is fine because it is part
of a strategic plan, he said. Those
ANTHONIA HUI
AL Wealth Partners
clients who feel that they were being

pushed products will be happier and if
the institution is getting more new
money coming in than flowing out, the
formula is working.
ing the single most important change

to make relationship managers (RMs)
less focused on pushing products.
I think we have got to the stage where
Transactional RMs are not likely to be happy, but

that is fine because it is part of a strategic plan.
we need to start forcing this issue, says

Bacon. To an extent, all industry participants have been trying to go down
this route over the last several years
and the results are not compelling in
their professional career there, for
MORE EDUCATION
terms of how much we have transi-
example, rather than focusing on build-
Sarwar suggests that the industry has
tioned to this mind-set.
ing a book, getting their bonus every
become too complicated and that client
year and then moving on, that will po-
education is paramount. Each asset
tentially have a profound effect on how
class goes up and down every year, but
He adds that changing the incentive

structure would be the most useful
change. If you incentivise on shortterm objectives you will always have
the mind-set of short-term product
push and instant gratification from a
revenue stand-point, he explains.
WHAT IS THE MOST IMPORTANT CHANGE TO MAKE THE

CUSTOMERRM INTERACTION BECOME LESS FOCUSED ON
PRODUCT PUSHING?
75%
You need to say to people that you are
RMs need to beer understand

client goals and risk appete
going to change your scorecard to be

about long-term client satisfaction and
Change incenve structures
asset growth not measured on a
Diversify the product offering
month-to-month basis, but rather on a

year-to-year basis.
Perhaps the industry should look to tie
down RMs for longer periods? If an RM
joins a firm with the idea that they are
going to spend the next 20 years of
10%
15%
Source: Hubbis - Asian Wealth Management Forum 2016, Hong Kong
167
FEATURE ARTICLE
WHAT WILL FINALLY DRIVE CONVERSATIONS TO BE MORE

NEEDS BASED?
portant, but I think we have a sub-set

of our relationship management universe that needs to go back to
school, he says.
35%
RMs being beer educated

to sell these soluons
18%
You have to start with RMs being better
Changing fee models
educated to sell the solutions; if they
Beer plaorms and

infrastructure
are leading the right sort of strategic
Client educaon
of getting the client to be thinking more
conversation you have a better chance

long term and more strategically.
6%
TOWARDS NEEDS-BASED
41%
CONVERSATIONS WITH
CLIENTS
The desire to develop more needsbased solutions for clients in Asia clearly
seems to be a process which will take
time perhaps another five to 10 years
according to some estimates.
[Asset managers] should not focus on short-term

themes and hype but bring good for clients.
It is happening in the US and Europe,

but for Asia it is unlikely to be one thing
that drives change.
Instead, says Harmen Overdijk, managing partner of Caidao Wealth, it will be
if you take a 10-year average return and
sation, the opportunity has been lost,
a combination of the regulatory envi-
risk, clients can relate to that, he says.
adds Bacon.
ronment, the willingness of the banks
If you take some of those things and
and asset managers to embrace a dif-
explain them to clients without being
I dont think it starts with the client
ferent approach, and the acceptance
condescending, you are building a re-
necessarily. The client is hugely im-
among clients.
lationship to make sure that the client

understands how markets behave.
However, to get to the point of creating better conversations between
advisers and clients, again fee models
need to change.
If they dont, how can senior management incentivise or motivate the RM
to have that discussion without having
the pressure that he needs to do some
sort of transaction?
If the client is getting the wrong message
from the RM at the start of the conver-
168
Transactional RMs are

not likely to be happy
[with changes in incentive
structures], but that is
fine because it is part of a
strategic plan.
MALIKARONNA
SARWAR
JUAN
HSBCWealth Management
RBC
WITH SO MUCH VOLATILITY AND UNCERTAINTY - WHAT

SHOULD BE THE MAIN TALKING POINT FOR ADVISERS TO
FOCUS ON TODAY?
38%
Performance and track record

Diversifica on benefits
to the por olio
13%
The service levels offered

by the manager
Ease of explaining the
strategy to clients
13%
36%
There also needs to be an education
positions within the portfolios, advis-
process to initiate discussions about
ers need to go back to doing proper
such needs-based solutions. Many
portfolio analysis first, position by
clients, for instance, dont really know
position, to be able to deliver very
what to expect from their portfolios in
targeted advice that is, by definition,
terms of investment returns.
needs based.
In practice, in the current environment,
Documentation of advice is clearly
advisers need to focus on clients exist-
critical, as is the provision of materials
ing portfolios, rather than continue to
to help clients fully understand every
try to engage clients with new ideas.
investment before it is made, and then

how that investment is likely to perform
Though these might be part of the
under the very broad range of circum-
solution for replacing or reinventing
stances through the life of the product.
The development of
digital advice platforms
When it comes to digital advice
platforms, there is big potential
for relationship managers to
use technology to help them
get quicker access to more
information and more
relevant data than if they
had to do the research
themselves.
In particular, wealth
management institutions are
increasingly focusing on a few
key areas where digital advice
can help them.
This is aimed at supporting
their bankers in having better
communication with their
clients, and giving them more
personalised advice which is
also more consistent.
Probably the most important
benefit is that they can be a
lot more productive in terms of
being able to speak with more
clients, and more frequently, to
give them the right advice at
the right time.
At the same time, the banks must also
[Banks] need to ensure

that the interest of the
clients, as well as those of
the asset managers and
themselves, are aligned in
this way.
HARMEN OVERDIJK
Caidao Wealth
adapt their incentive structures, to think

longer term, adds Overdijk.
They need to ensure that the interest
of the clients, as well as those of the
asset managers and themselves, are
aligned in this way, he explains.
That will finally drive the change in
thinking needed to lead to a new business model for wealth management
in Asia.
169
EXPERT INSIGHTS
Facilitating a more conducive

investment landscape
Kevin Talbot of Aviva Investors explains how the firms outcome-focused philosophy is
also a positive way to encourage investors to think, in a world where longer term and
needs-based conversations are necessary.
There is no doubt in the minds of many
as often as they can. But it would also
industry practitioners that the wealth
be good for fund houses like Aviva In-
management market needs to move as
vestors. Our multi-strategy funds are
quickly as possible towards being more
based on a three-year view, so we are
advice-focused and longer term in
looking to the future in terms of where
mind-set.
returns are going to come from, explains Talbot.
I can only hope this happens sooner

rather than later, says Kevin Talbot,
This is most likely going to be where
chief executive officer of for Aviva In-
there is a mis-pricing in the market
vestors in Asia Pacific, and alsochief
areas where he says there is potential,
investment officer for Asia.
therefore, to generate excess returns

over the three-year period.
He cites Japan as a positive example,

where some brokers are being encour-
As long as clients take the view that
aged to bring to market just one or two
they are willing to now look at the
key products a year, rather than per
product over this timeframe, then these
month. We think that type of approach
type of funds will have a lot of appeal,
will gather steam more throughout
he explains.
KEVIN TALBOT
Aviva Investors
Asia, adds Talbot, a 38-year veteran of

the financial markets.
THE RIGHT OUTCOMES

Ever since Euan Munro took the helm
Inevitably, this would be a good thing
globally at the firm in January 2014,
In line with this, its multi-strategy funds
from a clients perspective, to remove
the asset manager has been striving
proposition, which is outcome-orient-
the temptation from wealth managers
to be a global leader in outcome-fo-
ed rather than focused on a benchmark,
and advisers to try to churn portfolios
cused solutions.
is a cornerstone of the overall strategy.
170
Talbot says the firms breadth across
Research the firm has done has shown
assets classes via real estate, fixed
that over 20 years, the risk premia in-
income, equity, multi-asset and alter-
vestors can expect from global equities
native investments combined with
is around 5%. Our rationale, therefore,
more than USD427 billion invested on
is to try to achieve this via a portfolio
behalf of its customers, gives it the
which does that, but with one-third to
size and scale to successfully see out
one-half the volatility of investing in
opportunities that will deliver spe-
global equities, he explains.
A range of outcomes at
Aviva Investors

Sustainable income
low bond yields and high
equity valuations mean
that outcome-focused
approaches could secure
the regular investment
income todays investor is
looking for.
Capital growth
as the risks of a market
correction grow, switching
to investments designed
to provide steady capital
appreciation makes sense.
Beating inflation
despite a recent sharp
fall in inflation rates,
unprecedented monetary
stimulus still poses a threat.
Inflation-proofed funds
continue to represent an
attractive investment.
Meeting liabilities
the natural extension
of an outcome-oriented
investment approach is to
help institutional investors,
such as pension schemes
and insurance companies,
to meet their long-term
liabilities.
cific investor outcomes.

This is a key selling point, believes
The investment aspirations and con-
Talbot, given the combination of
cerns that the outcomes try to deliver
volatile markets over the last 12
on might range from individuals saving
months, plus the expectations about
for retirement through to the largest
continued uncertainty as a result of
institutional investors.
geo-political events like the US elec-
tions, Brexit and others.

On the Aviva Investors website,
Munros message defines the approach:
Among another key value-add of these
At Aviva Investors we believe it is time
strategies for clients is that, unlike the
I can only hope this [focus on advice and

longer-term investing] happens
sooner rather than later.
to think differently. Thats why our
dynamic asset allocation approach
entire organisation is united behind
which is dependent on being in the right
one common goal: to deliver the spe-
sector at the right time we believe
cific investor outcomes that matter
that because nobody can predict the
most to todays investor.
future, our outcome-orientated solu-
tions approach will produce superior

MEETING INVESTOR GOALS
risk-adjusted returns over any type of
And for Talbot, whose main role at
The multi-strategy target return funds
business cycle, says Talbot.
Aviva Investors is externalising the

business and its capabilities via third
Talbot markets out of Singapore targets

cash-plus 5%.
NEW MIND-SETS
parties, he sees a lot of growth poten-
The more that the market in the region
tial in the region.
The target income fund, meanwhile, is
moves towards more of a longer-term
focused on cash-plus 4%. The aim is to
approach to investment portfolios,
We manage about USD5 billion in fixed
achieve these returns with significant-
then the greater the likelihood that
income out of Singapore at the moment,
ly less volatility compared to global
the multi-strategy concept will start
and I would like to think this can double,
equity markets.
to flourish.
or more, over the few years, he says.
171
EXPERT INSIGHTS
The changing landscape of

overseas property: China factor
The already-large wave of wealthy Chinese buying residential and commercial property
around the world is only expected to gather momentum, despite government measures
to temper demand, says Piers Brunner of Knight Frank.
According to the Knight Frank definition
year, Sydney 11% and Melbourne 11%.
of upper middle class, there are 63
Yet this can also have a social impact, he
million Chinese who fit into this catego-
adds. For instance, some investors buy
ry. And they are active in the interna-
up units and then leave them vacant,
tional real estate market, despite the
which has a knock-on effect in terms of
countrys USD50,000 capital control
rising rental prices in local areas.
per person per year.

At the same time, some governments
They are motivated to buy offshore by
have taken action.
factors such as education, immigration,

diversification of portfolios and curren-
For example, the UK, has increased
cies, and lifestyle changes are all key
stamp duty; Australia has reviewed
drivers for wealthy Chinese to look
foreign investment policy, and immigra-
outside their own country, explains Piers
tion barriers are rising.
Brunner, chief executive officer for

Knight Frank in Greater China.
GATHERING PACE
According to Brunner, this trend is just
Plus, the sales process is very much
starting and has a long way to run in
driven by relationships and education.
terms of more Chinese money heading
PIERS BRUNNER
Knight Frank
to overseas property markets.

FEELING THE IMPACT
The effect of the mass of money finding
In addition to the US and various
its way into certain property markets
gateway markets, one of the next waves
But he also foresees governments
has led to rapid price movements in
he predicts will be investment into
trying to defend their markets against
these locations. For example, says
secondary cities, such as Manchester
such price rises, via measures to at
Brunner, Vancouver was up 24% last
in the UK, or Seattle in the US.
least try to temper demand.
172
WE DONT
JUST OFFER
INVESTMENT
SOLUTIONS,
WE DESIGN
THEM.
At Principal Global Investors, we believe that successful investment solutions are as
unique as the clients we serve. Our multi-boutique asset management structure provides
our clients with a single point of access to custom-designed investment solutions.
Our boutiques have focused expertise in asset allocation, equity, fixed income, and
real estate expertly delivered with conviction, integrity and commitment. This
multi-asset expertise is why sovereign wealth funds, endowments and some of the
worlds largest retirement plans entrust us with managing assets.
The benefits are clear: customized investment solutions and consistent investment
results all through a single, global investment leader.
For more information visit www.principalglobal.com
2015 Principal Financial Services, Inc. | AD2560-02
FIRM PROFILE
How Credit Suisse is leading an

Asian asset management charge
With a mandate to capitalise on the opportunity that Asias wealth demographics
presents, Credit Suisse Asset Management plans to leverage its own private banking
strengths across multiple distribution partners and markets, reveals Michael Levin.
Having a clear business strategy should
add from the security selection or from
mean that volatile and unpredictable
risk management.
markets are, in fact, an opportunity to

provide more value-added services and
There is a shift today, however, with
investment solutions to clients.
volatility heightened and lower correlation among securities. In Levins view,
We see a renewed awareness of the
therefore, active management through
inherent risk in markets, says Michael
fundamental stock and credit selection
Levin, head of asset management for
as well as risk management will make
Credit Suisse in Asia Pacific.
the difference in the performance realized by investors. This gives us an op-
You dont make double-digit returns
portunity to deliver relevant solutions
without potential downside risk or
to clients.
volatility, he adds.
LEVERAGING RELATIONSHIPS FOR
This has played out in recent years.
NEW GROWTH
From 2009 to 2013, and then again in
This plays to what Levin says are key
2014, high correlations and strong di-
Credit Suisse strengths hedge funds,
rectional performance for both equities
real estate and traditional as well as non-
and fixed income meant that the more
traditional fixed income, such as Asian
risk investors took, in general, the more
corporate bonds and senior loans. And
money they made.
it explains why the firm is increasingly
MICHAEL LEVIN
Credit Suisse
focused on broadening its offering and
Until about two years ago, the firm had
This also meant that passive strategies
relationships, both across the region
a fairly limited asset management en-
performed well relative to active strat-
and via different institutions in the
gagement in Asia in terms of selling its
egies, since there was little value to
wholesale distribution space.
funds through third-party private banks.
174
Third-party distribution is one of our
established relationship with its own
that are suitable for the right clients to
major initiatives for 2016 and going
private bank and offer investment solu-
deliver an investment solution that
forward, and we have invested a tre-
tions, products and services to third
creates a good client experience.
mendous amount in terms of commu-
parties as well.
A SOUND SET-UP
nication, relationship building, and

making our offering relevant for poten-
ESSENTIAL SUPPORT
Levin certainly doesnt expect growth
tial partners, explains Levin.
Inevitably, getting traction with third-
in Asia to be plain sailing, especially
party private banks is never easy, espe-
given the number of established players
cially in such a competitive landscape.
and platforms.
it garners from the direct relationships
A priority for many of these institutions
Yet he is spurred by the fact that, in
it has access to via its own wealth man-
is more support, beyond getting the
many cases, existing platforms have too
agement offering.
product approved.
many products.
While Credit Suisses private bank oper-
This is especially the case at the outset
Many third-party distributors are ra-
ates on an open architecture model, the
of the relationship, when they start to
tionalising the products available on
advantage mainly comes from the prox-
promote a fund.
their platform, says Levin.
asset management division has to the
At such times, they need a lot of guid-
As they shrink the number of counter-
banks relationship managers, as well
ance, requiring the fund manager to
parties they work with, and the number
as its clients.
present to the banks front-line advisers
of funds they offer to enable a greater
as well as portfolio managers, and
degree of focus on the sales effort, we
answer their questions.
have to make a strong and credible case
At the same time, the firm benefits from

being able to leverage the insights that
imity and closer connectivity that the
We are able to better articulate the

benefits and risks of various investments, says Levin.
of the value-add of our products and

They also need regular communication
solutions to justify replacing someone
on an ongoing basis, as part of the
on the platform.
And I feel that the more informed the
support they might require for their
view that we share with clients, it makes
end-investors.
them more durable investors, in order
As a result, Credit Suisse has been investing in building up its product spe-
to stay invested through good and bad
Another hurdle is the limitation to
cialist team as well as its pool of local
periods to get the benefits of a long-
having conversations with Asias
portfolio managers.
term investment approach, he adds.
wealthy about funds, given the ongoing
Tied to this is the added bonus of being
challenge to raise their penetration as
Offering that access in the Asian time
a percentage of AUM overall.
zone is a material differentiator, ex-
able to get closer to clients in terms of

communication during periods of stress.
We are in the process of determining
plains Levin.
Addressing this, says Levin, requires
conversations to be about investment
This combines to form a multi-boutique
solutions that match client needs.
model which is focused on specialised

investments and relevant expertise,
a select group of the best distribution

partners and the products that are most
This calls on the client adviser to have
sitting within a broader governance
relevant to their clients, says Levin.
greater awareness of the set of offerings
framework which is the institutional
relevant to the client.
infrastructure of Credit Suisse from
But looking at Asia generally, with
the operational, legal, compliance and
Singapore becoming a leading wealth
So, I view our first job as being educa-
regulatory perspectives to navigate
centre globally, plus the influx of capital
tion, explains Levin.
local geographies.
of a better opportunity than to take an
It is not about selling products; its
We think this gives us the best of both
institutional asset manager with an
about identifying the right products
worlds, he adds.
from Greater China, it is hard to think
175
EXPERT INSIGHTS
Facing up to the regulatory

reality of transparency
Andri Manatschal of PwC explains the impact of the wake-up call for wealth
management firms and clients in the face of global regulatory measures to try to
ensure transparency.
In the face of changing regulations and
agencies which are likely to now be in
the impact on the types of structures
communication with each other.
that are now relevant, wealth management firms need to figure out how to
This has to be cleaned up before the
adapt their offering in line with whats
transparency initiatives are enacted in
allowed and what will meet the needs
2017 or 2018, says Manatschal.
of clients.
As a result, he explains, there is a small
Clients today need to think about what
and closing window of opportu-
does this transparency mean for me?
nity to get this right.
says Andri Manatschal, partner, international private wealth and entrepre-
CLARITY NEEDED FOR HNW
neurs, tax and legal services, at PwC.
CLIENTS
The upshot for banks and other wealth
In other words, what do they need to
management organisations is they
understand first, and then what do they
need to be clear with clients who are
need to do to make sure either them-
no doubt receiving a lot of different
selves or their organisations can
and conflicting information from
control the flow of information?
multiple sources.
Control in this case, he says, doesnt
The Panama Papers incident, involv-
mean hiding information.
ing 11.5 million leaked documents
ANDRI MANATSCHAL
PwC
detailing attorney-client transactions,
There is all the more reason, therefore,
Instead, it is about ensuring the true
highlighted many examples where
for firms to make sure that paperwork
and consistent information goes to
various parties have side-stepped the
is filed properly, and in a timely manner,
various authorities and government
reporting required of them.
explains Manatschal. Plus, an indepen-
176
dent assessment is needed to see if
TEAM EFFORT
structures set up 10, 15 or 20 years
PwCs experience with clients around
ago, for example, are still up-to-date.
the world can only be an advantage

going forward, says Manatschal.
The challenges start, for instance,

where clients may have possible tax
While Russia is his teams focus for now,
information that was not documented
he sees this shifting to Asia in time as
as there was previously no requirement
well. An entrepreneur in Russia is not
to do so in a particular jurisdiction.
much different from an entrepreneur

in South America or China, he explains.
As a result, filing that taxable information becomes impossible, says
They all have the same basic ques-
Manatschal, because there is no docu-
tions and share similar concerns
mentation to back it up.
about their families, their personal

safety and how their business works
TAKING A COMMON SENSE
within the local rules.
APPROACH
Amid all of these new developments,
This also serves as a reminder that no
Manatschal says it is critical for organ-
single person cannot tackle these prob-
isations to adopt a common-sense
lems alone; it takes a team.
approach. And this is unlikely to entail

any easy way out.
Thats simply a reality because it is

impossible to have a one-man show and
The first mistake is to believe that
be an expert in everything, he explains.
nothing has changed that you can

simply continue to do now as we did
For example, many of the structures
in the past, he says.
previously put in place were unregulated, so now need a lot of attention
By contrast, changes in regulation and
given they are coming under the regu-
structuring mean major changes both
latory spotlight.
in terms of the way in which firms do

business, and how clients approach
Taking a practical, pragmatic attitude
their portfolios.
helps at times like these, adds Manatschal

which means deciding between what
In short, they need to face up to the
to retain and what to either change or
new realities of lower returns, higher
let go to secure ones future.
Avoiding common
mistakes
In general, many clients dont
seem to understand the full
magnitude of the potential
problems they face.
One of the common mistakes
many clients make when thinking
about their tax and reporting
situation relates to mind-set.
The first mistake, explains
Manatschal, is they believe
nothing has changed, and that
they can simply act as they did in
the past for example, change
their contracts and structures.
But this doesnt work, as
substantive changes are often
required, including to their
lifestyle.
Or, they might have to accept
that they will pay more tax.
Another mistake he sees is when
people ignore the requirements.
And because they do this, they
are not dealing with the situation
in the way they need to.
One of the consequences
for such clients who arent
committed to being compliant, is
they will find it difficult to find a
reputable service provider willing
to work with them.
risk and greater volatility.

His work in Russia has shown him the
Its this type of philosophy which Swit-
importance of avoiding complexity.
zerland, where Manatschal is based,
Keeping business methods straightfor-
has taken to implementing new
ward not only helps to withstand
works, they may not face the same
changes. While this has created a stir,
change but it is also an advantage when
amount of restructuring.
he believes that the ultimate result will
it is time to submit paperwork for
be greater longevity and stability for
taxes, he explains.
more organisations. And any business
But they should, however, still listen

to such advice, to keep in mind to avoid
which gets lost in the transition is a
Yet he believes that for many clients
costly, time-consuming work in the
small price to pay.
in Asia, where regulation is still in the
future.
177
EXPERT INSIGHTS
Plugging a gap for long-term

structuring advice
Nigel Rivers has been inspired by a lack of real advice in navigating todays complex
regulatory, asset structuring and succession planning landscape. He expects his new
firm, Capital Solutions, to fill a hole in finding the right solutions for each client.
Despite the economic challenges and
well as quality, the roles they play are
general slowdown globally since 2008,
still very transactional. They charge a
Asias wealthy have seen continued
fee for a specific service, but have little,
growth in their personal wealth. And in
if any, ongoing involvement.
turn, they have increasingly sought

geographic diversification and a wider
Meanwhile, insurance companies tend
array of asset classes.
to provide a product offering related to

estate planning, mostly still focused on
Yet in the face of these families growing
universal life.
needs to manage business and personal wealth, service providers dont
And independent trust companies often
seem to have made as much of this
only provide a relatively limited scope
opportunity as they might have given
of services.
that they typically operate in silos.

As a result, there is a role for an adviser
For instance, explains Nigel Rivers,
who is genuinely independent rather
founder of newly-formed Capital Solu-
than product specific, but who also has
tions, private banks and the new breed
sufficient knowledge and experience of
of multi-family offices tend to mainly
all the tools available to families.
NIGEL RIVERS
Capital Solutions
focus on bankable AUM. However, most

family wealth resides in less liquid
Families need someone who can
assets, such as the family business or
provide advice and guidance on what
in real estate.
is best for them and their specific
CATERING TO REAL NEEDS
profile, he adds, and can ensure this
Rivers has his sights on opportunities
When it comes to tax and legal advisers,
is properly implemented in a rational,
in both North and South Asia. Out of
while they have increased in number as
consistent and independent way.
his office in Hong Kong, he will service
178
local clients, as well as those from main-
and decide who should participate in
They need to do this before the patri-
land China and Taiwan. His Singapore
management, while at the same time
arch or matriarch dies, or are no longer
office expects to work with clients from
making sure the family gets a fair dis-
able to make rational decisions, or before
countries like the Philippines, Indonesia,
tribution of the income the business
family members get disgruntled and start
Thailand and Malaysia.
makes when the patriarch dies.
fighting, he explains.
He is confident that the independence
Further, the solution must also ensure
NETWORKED MODEL
of his new firm will mean he can help
that money is fairly distributed to all
A big part of the value that someone
clients to identify those professional
family members, regardless of whether
like Rivers can provide wealthy families
services firms which are best-of-breed
they are in the business or not. You
in Asia is to ensure they can access the
technically, and also aligned in the way
need to be independent to help in these
right professionals. They shouldnt rely
they work, to the specific needs of each
cases, says Rivers. It requires knowl-
just on their private banker for this, nor
client. Its advisory, first and foremost,
edge and experience of these issues, but
even the advisers to their business.
he stresses.
also the ability to offer different solutions
However good their advice has been in
for discussion, so that the family can
relation to their specific field, there are
decide what suits them best.
special dynamics to creating and man-
This covers a range of services, including wealth asset structuring, succession
aging an infrastructure for legacy
planning, family business governance,
Another reason a truly independent ap-
wealth. It is important that the family
compliance and reporting, and family
proach is essential in todays environment
gets the best help, he adds.
office architecture.
is tied to the complex compliance regime.

For instance, wealthy families want to
Instead, it is vital that families are able
For example, broadly across South-east
invest in assets in other geographies, so
to look at the big picture and explore
Asia, he sees a big difference in terms
must understand how to do this and be
their options, and ensure they are acting
of the current wealth owner being older.
compliant, given the financial and repu-
in the most effective and optimised way.
As a result, they are more likely to be
tational consequences otherwise.

While we are small, we have the cred-
at the point where they are transitioning the ownership of the family business
So if a family wants to buy real estate
ibility thats required by the people who
and their wealth to the next generation.
in the US, for example, which structure
recommend us to their clients in the

first place, says Rivers. Clients are able
to tell the difference between someone
who can genuinely offer advice in a
You need to be independent to help in these cases....

It requires knowledge and experience of these issues, but
also the ability to offer different solutions for discussion.
common sense and independent way.

By getting this type of offering right,
the relationship with the client can also
become a bit stickier. In turn, it will
enable him to charge for his service.
Historically there has been an aversion
in Asia to paying fees for advice. But I
In such a situation, the business might
is appropriate, and what reporting they
think thats been changing in the last
have been built up 40 years ago or more,
must be aware of (in the US and at
few years, and I believe people are much
and there are often a number of chil-
home), are essential elements to know.
more prepared to do this if they see the
dren, some of whom work in the business, others dont.
value, he explains.
Helping families avoid making mistakes
during these and other situations is also
The fact that there is growth in family
Some of the common issues that need
a critical role for Rivers new firm to take.
offices around the region, especially in
to be addressed, therefore, include how
These often happen because families
China, is proof for Rivers of this change
to transition the business ownership
dont consider the options early enough.
in mind-set towards advisory.
179
EVENT HIGHLIGHTS - INDIAN FAMILY WEALTH FORUM 2016 - APRIL
Managing Indian family

wealth
At our 2nd annual Indian Family Wealth Forum 2016 in Mumbai in early April leading
practitioners from single- and multi-family offices, private banks and professional services
firms explored some of the key themes in this space. This looked at how to give advice
on the critical issues they face and need to plan for when it comes to their businesses,
personal portfolios, next-generation planning, tax affairs, legacy matters and more.
Wealth managers face a relatively un-
In determining how to reach these
tapped market in India when looking to
wealthy families, understanding their
woo families, as wealthy clients looking
financial situation and concerns has
to increasingly separate their personal
become an integral part of the sales
and business wealth.
process today. This gives them insight

into what to offer to these clients, and
But this requires a certain skill-set to
how to offer it.
be successful in managing family dynamics.
There is no one-size-fits-all solution to

help family businesses transition from

IIFL Private Wealth

Management
Jersey Finance
Motilal Oswal
Pafilia
BVI House Asia
One thing that is clear is that products
one generation to the next. But first
alone will not get Indian wealth manag-
identifying the needs and goals of each
ers far enough with wealthy individu-
promoter and the wider family will
als and families in India who have all
ensure the right structure for a smooth
Anyone advising wealthy Indian busi-
the assets and the disposable income
succession plan.
ness-owners also need to understand
to hire the best advisers from around

the world.
how to guide their clients on how best

There are various dynamics that result
to invest their personal wealth for the
in conflicts and challenges in creating
long-run.
This means advisers in India are forced
a smooth succession for family busi-
to look for new ways to distinguish
nesses. The relationship between the
For example, there is a mind-set shift
themselves from others and to add
promoter and the next generations is
under way in India. Increasingly, wealthy
value to their clients.
chief among them.
families and individuals are becoming

more risk-taking and willing to embrace
business ideas which they wouldnt have
less than a decade ago.
HNW individuals and families in India
are also moving towards sustainable
philanthropy, and want to give in a way
that makes significant social impact.
This also means that they favour organisations that use technology for
maximum impact.
180
Aditi Shrivastava
Ajay Agashe
Angelo Venardos
Anupam Guha
EY
ICICI Securities
Benaifer Malandkar
Dhruv Mehta
Elise Donovan
Gaurav Arora
Raay Global Investments
FIFA
BVI House Asia
Religare Private Wealth
Gautami Gavankar
Kanwar Vivek
Shanker Iyer
Manish Singla
Munish Randev
Kotak Mahindra
Yes Bank
Client Associates
Waterfield Advisors
Nipun Mehta
Nishant Agarwal
Poonam Mirchandani
Sharad Mittal
Himadri Chatterjee
BlueOcean Capital Advisors
ASK Wealth Advisors
Barclays
Motilal Oswal Financial Services
Sunil Sharma
Tarun Birani
Vinay Bajpai
Shweta Shah
Aashish Somaiyaa
Sanctum Wealth Management
TBNG Capital Advisors
Deutsche Bank
Edelweiss
Motilal Oswal Asset Management
Abhisek Puglia
Intellecap
Arpita Vinay
Centrum Wealth Management
181
FIRM PROFILE
Shedding light on the anatomy

of a family business
Running a family business successfully is not just about lineage, creating a need
for a range of services that Heritage Trust Group is offering to fill some potentially
problematic gaps.
Running a family business is highly-
ping nature of business and personal
complex, challenging and emotional.
wealth, there is plenty to be done to
Getting it right, therefore, depends on
align affairs for the future.
a host of factors that most entrepreneurs either dont have time or the ex-
In Diederens opinion, family offices are
perience to focus on.
best equipped to survive if they have a

strong foundation, starting with a shared
This is the opportunity which Heritage
understanding about why the family is
Trust Groups new family office ser-
in business together in the first place.
vices unit has identified. It is an add-on

to the corporate and fiduciary services
This is often under-estimated, he says.
offering it provides across Asia and the
Advisers such as lawyers, accountants
BVI, including incorporation, business
and even philanthropy specialists ap-
services, estate structuring and suc-
proach the family from their specific,
cession planning.
expert angle, but tend to forget that the

family is intra-dependent.
Basically, we want to look very holistically into business families, says Hans
A strong foundation, however, pre-
Diederen, head of this new division at
pares the family for when its time for
Heritage, to increase the success rate
the baton to be passed to younger
of business continuity and, at the same
generations. Succession is regarded
time, family harmony.
as an event, but this only happens once
HANS DIEDEREN
in a generation, explains Diederen.
Given that family values can quickly
A SOLID STARTING POINT
Its the process and the timely plan-
become intertwined with corporate
In line with the dynamics of Asian family
ning of the preparation of this process
ones, such planning must take both sides
businesses, coupled with the overlap-
that is most crucial.
into account to succeed.
182
FIRM PROFILE
A GAP TO FILL
them to probe their parents with the
Heritages independent role puts the
right questions to address the succes-
firm in a good position to do this, be-
sion planning challenges. This is an issue
lieves Diederen, as this means it gets to
he commonly refers to as the elephant
hear what maybe bankers and financial
in the room.
advisers dont.
But not being prepared can have sigThis is especially important amid the
nificant consequences. Not having a
particular challenge that families face
basic will, let alone a trust structure
today in light of the characteristics of
in place, creates huge challenges
the millennials generation.
which families probably wont find

until they go to the bank, and the bank
While every generation differs from the
says that everything has been frozen,
one before it, millennials have grown up
explains Venardos.
in a more globalised environment with

ANGELO VENARDOS
rapid technological change.
THE FAMILY NICHE

For Heritage, family office services rep-
This generation has studied abroad and
resent a significant opportunity but
worked around the world, so they are
one which will take time to realise as
developing different values, and this can
the firm looks to carve out this niche.
Yet in dealing with people who have

worked hard to create a successful
business and at the same time bring up
their family, agreeing on a set of consistent values is easier said than done,
Its the process and the timely planning of the

preparation of this process that is most crucial.
especially with generational differences to consider.

Angelo Venardos, chief executive officer
of Heritage, recalls a recent example of
this in Indonesia. We met with three
alienate them a bit more from the pa-
This is due, in part, to the fact that dif-
generations of the family over five hours,
triarchs and matriarchs than has hap-
ferent countries are at different stages
discussing all types of matters. At the
pened in the past, explains Venardos.
of development and awareness in terms

of the need for more formality around
end of these conversations, one of the

brothers quietly said that he didnt agree
This is one of the ways he and Die-
with the current shareholding.
deren are looking to help: offering
managing the family business.
advice for a fee, in addition to other
But it is an invaluable component of
This type of problem needs to be figured
services and solutions once the needs
the advice the firm gives overall. It
out earlier, so that all parties involved
have been identified.
accelerates the discussion within the

families to do something to review
can seek the guidance they need.

Diederens approach is to tailor the
what has been in place and, by bringing
This really requires a third party with
message, depending on which genera-
the generations closer together, it
which the family has a relationship to
tion he is speaking with. I think my
forces also the patriarch to not leave
sit down patiently and work it through
major task with the second generation
the next generation with any legacy
with them, says Venardos.
[of millennials] is to guide and prepare
issues, explains Diederen.
183
EXPERT INSIGHTS
Greater transparency raises

privacy and advice red flags
The aftermath of many data leaks of greater tax compliance around the world also
threatens the privacy and confidentiality of the majority of individuals who legitimately
use offshore structures, explains Stephanie Jarrett of Baker & McKenzie.
As politicians scramble to further
On the flipside, however, regulation has
tighten the noose around tax evasion
arguably gone a step too far.
and money laundering through farreaching measures like the Common
There are legitimate reasons for
Reporting Standard (CRS), Automatic
wanting confidentiality of information,
Exchange of Information (AEOI) and
adds Jarrett. Some of the transparency
FATCA, this sudden urgency to enforce
measures are causing considerable
compliance, although desirable, may
physical danger as well as business
have gone too far.
disadvantages to many people.
And, in their zest to ensure transpar-
KEEPING INFORMATION IN THE
ency, lawmakers may be ignoring the
RIGHT HANDS
bad side of transparency; or information
A real threat that has not been the
going astray.
centre of much attention to date, is the

fact that information could be passed
I think going forward there is going to
to people who use it for personal gain
be a lot of transparency because of CRS
or other questionable purposes.
and FATCA, but this has a good and a

bad side, says Baker & McKenzies
For example, politicians might mis-use
Stephanie Jarrett, a Geneva-based
data for arm-twisting; criminals, on the
partner who specialises in trusts, estate
other hand, might be able to access in-
and international tax planning.
formation and use it to threaten some-
STEPHANIE JARRETT
Baker & McKenzie
ones physical safety. Further, leakage of
At the same time, Jarrett says the prime
The positive aspect is that many people
sensitive materials to business com-
concern of many wealthy clients, regard-
now realise they must pay their taxes.
petitors could also be damaging.
less of their geography, is the security
184
of their assets because of geo-political
Otherwise, she explains, clients are
offshore structures, she cautions about
uncertainty globally.
more likely to start to face litigation or
the need for them to be discerning.
tax issues with structures because of

As a result, while sharing information
greater transparency.
with tax authorities is clearly justifiable,
I think some of the offshore centres,

like Belize, are going to face a hard time
there is a pressing need to ensure it is
THE RIGHT ADVICE
going forward. They risk being shut out
kept confidential, and used solely for
The consequences of these regulatory
of the banking system if they dont play
tax compliance.
initiatives are increasingly impacting
the [transparency] game properly.
the nature of wealth management,

The other major concern for clients,
which is slated to undergo a significant
MAKING WISE CHOICES
adds Jarrett, is preserving their wealth
shift going forward.
Consequently, there is a need to choose
and passing it on to the next generation.
the offshore destination carefully.

More specifically, says Jarrett, they will
This, too, is becoming more and more
limit the role for each type of adviser
This must be based on the tax regime
of a challenge given the transparency
manager - such as private banks, family
a client lives under, since this will dictate
which is now required of various struc-
offices, independent asset managers
whether or not an offshore company is
tures, she explains.
(IAMs) and lawyers.
likely to be a good idea from a tax point

of view.
For a resident in Hong Kong or Singapore, for instance, Jarrett says it makes
While sharing information with tax authorities is clearly

justifiable, there is a pressing need to ensure it is kept
confidential, and used solely for tax compliance.
sense for them to hold assets outside

of those jurisdictions in an offshore
company; those markets do not consider offshore accounts illegal.
At the same time, it is important not
to tar everybody with the same
brush, since this might lead to some
politicians and others in power to take
hurried decisions.
Consider the following: laws today often
For example, she adds, the increasing
allow a claim on family assets to two
risk of litigation has already led to many
people living together for a certain
private banks shying away from the
The solution, therefore, lies in looking for
amount of time without them being
concept of actually giving advice.
a middle ground, says Jarrett, rather than

crafting rash laws that can lead to unfore-
married.
Another big emerging challenge for
seen or undesirable consequences.
Other areas of complexity could also
banks, trust companies and IAMs alike,
stem from multiple marriages in a
is how to manage the presentation of
A middle road regarding the ownership
number of different jurisdictions, and
mountains of documentation to clients.
of private companies, regarding to

whom information could be transferred
due to any children from those marriages, including issues of illegitimate,
At the end of the day, however, there
and what safeguards one could have,
adopted and step-children.
is no under-estimating the importance
needs to be found, she explains.
of (re)establishing a close working relaMore attention needs to be paid [by
tionship with clients, she advises.
This can be done, she adds, if the

reasons for using so-called offshore
wealth managers] to the overall planning for the preservation of wealth,
While private bankers typically know
companies and other structures are
explains Jarrett.
their clients well, when it comes to
articulated more clearly.
185
FEATURE ARTICLE
Making the most of

Chinese wealth
Estate and inheritance taxes are among the various the risks for Chinese HNW and
UHNW clients. Increasingly, they are looking for new options, especially offshore ones,
to diversify, protect and grow their wealth in todays complex world. The potential to
offer them advice in this presents significant opportunities for Asias wealth managers.
Yet as the China market continues to
[Chinas wealthy] are turning

to wealth management
specialists, both offshore
and onshore, to help them
achieve their objectives.
open and the wealthy become more

sophisticated, they are increasingly
looking to diversify their holdings
outside of the Mainland.
They also see overseas investments as
a way to achieve higher returns through
access to a broader selection of prod-
JING ZHANG BROGLE

Edmond de Rothschild
ucts and services than is available domestically, explains Jing Zhang Brogle,
chief executive officer of Edmond de
Rothschilds Hong Kong branch. So
they are turning to wealth management
specialists, both offshore and onshore,
to help them achieve their objectives.
Statistics show that there are two
edge of managing risks among many of
primary needs for Chinas HNW and
these individuals.
To be profitable in servicing these individuals, therefore, Amanda Chen,
UHNW populations. The first is to diversify and protect the wealth in an
Specific issues that some clients might
deputy head of wealth management
increasingly-complex world; the second
face, therefore, include the depreciation
for Nomura in Asia ex-Japan, suggests
is to have proper succession planning
of RMB against the US dollar, invest-
that it is essential to provide Chinese
for the family businesses and wealth.
ment in unfamiliar markets (overseas
clients with a full suite of wealth man-
real estate and financial products), and
agement services including estate
This is highlighted by the general a lack
understanding the implications of in-
and wealth planning, corporate finance
of diversification of assets and knowl-
heritance taxes in mature markets.
and real estate.
186
This is becoming more of a reality than

in the past.
While Chinas wealthy prefer to take a
predominantly active role in their investments, there are signs that more of
them are entrusting a larger share of
their wealth to private banks or independent asset managers.
At the same time, HNW individuals in
China tend to prefer to hold less in cash
It is essential to provide
Chinese clients with a full
suite of wealth management
services including estate and
wealth planning, corporate
finance and real estate.
AMANDA CHEN
Nomura
and deposits, and it creates a lot of opportunities for wealth managers who
offer professional advisory and investment services.
quality of their lifestyle, now they are
from the current anti-corruption cam-
Clients in China have become much
more focused on the preservation and
paign, and potential future PRC estate/
more receptive to direct investment
transfer of wealth to the next genera-
gift tax will potentially subject their
opportunities and advice on alternative,
tion, adds Brogle.
wealth at huge risk, says Lee.
hedge funds and private equity, ex-
MORE STRUCTURING NEEDED
In China, most of our clients understand
plains Brogle.
There are various drivers for Chinese
the use of a will, but utilisation of other
clients to engage wealth structuring.
planning ideas such as pre-nuptial agree-
non-traditional investments such as
Perhaps most exciting for long-term
ments or trusts or foundations are still
opportunities is the fact that in the
According to Kevin Lee, partner at
in the relatively developmental stage,
recent volatile environment, demand
Zhong Lun Law Firm, there are also
he explains. We have been advising
by HNW Chinese for financial planning
various concerns for Chinese HNW
HNW clients on using such estate plan-
and wealth structuring expertise has
clients to address. Key among them is
ning tools, but adapted to the PRC
increased. Whereas in the past, their
how to protect wealth. Constantly-
context to the extent possible.
main investment objectives were to
changing policies, uncertainty about the
grow their wealth and improve the
future of the country, collateral damage
Another risk is family business succession. We see examples of children of

HNW individuals who are not keen to
take on responsibilities of family busi-
I dont see demand for wealth

planning diminishing instead,
sophistication is evolving
towards structures which are
more secure and transparent.
nesses, adds Lee. For family governance, some firms have found that
advising PRC clients on creating family
charters and setting up family councils
has been well-received.
Philanthropy is also a concept which is
gaining some traction among PRC
clients, although domestc laws are not
MARTIN CRAWFORD
Vistra Group
well developed yet in this respect.

When it comes to trusts, most of the
planning done to date has been based
187
FEATURE ARTICLE
on offshore models where offshore
dont see demand for wealth planning
trusts own offshore assets.
diminishing instead, sophistication is
evolving towards structures which are
According to Martin Crawford, chief
more secure and transparent.
executive officer of Vistra Group, tax is

often around 25% of the driver for a lot
To play a role as more Chinese wealth
of the cross-border structuring out of
moves offshore in search of protection
China. The rest is done for the pur-
and other wealth solutions, Roger Steel,
poses of asset planning, family succes-
president, new markets and business
sion and diversification of wealth.
development for Sun Life Financial in

Asia, says there are some key ways to
Clients accept they will pay certain
do this. Product not an issue; as always,
types of taxes at some point, he ex-
its first and foremost about distribu-
plains. They are just trying to minimise
tion, he explains.
it legally and use structures which are

more dependable.
In addition, firms need to understand

the onshore market, which is shifting
Domestic PRC trusts are not being used
to protection, and be able to manage
in any material way for such planning
within the changing regulatory and
yet, says Lee, and clients still face dif-
enforcement environments. Regulation
ficulties to inject onshore assets into
is driven by macro-economic consider-
offshore trusts.
ations, not just customer protection.
But subject to currency controls, there
GATEWAY
should be growth in the offshore trust
Depending on who you talk to will lead
market at least in the near term pending
to different answers to the question of
the anticipated amendment of the In-
where the gateway of the future will
dividual income tax laws and possible
be in access to Chinas wealth.
introduction of gift/inheritance tax.

Broadly, there is a swing among wealthy
Crawford is also optimistic for the op-
Chinese individuals from offshore to
portunity to service Chinas wealthy. I
mid-shore jurisdictions, such as Singa-
Changing tax laws

One of the biggest issues the
wealth management industry is
likely to be dealing with over the
next couple of years stems from
the changing tax laws in China.
With the new individual
income tax law, it will affect all
the offshore structuring that
clients in China have done to
date. Further, CRS means that
governments from 100 countries
will be reporting to the Chinese
tax authorities the details about
all the bank and other accounts
that Chinese residents have in
those countries.
This will lead to a new era of
tax audits and investigations,
requiring compliance with
the laws, predicts Michael
Olesnicky, partner and senior
adviser at KPMG.
As a result, for advisers with
Mainland China-based clients,
he says it is time to look at their
tax affairs to ensure they will
remain compliant and survive
detection going forward.
pore and Hong Kong.They are looking

for structures which stand the test of
Product not an issue;

as always, its first
and foremost about
distribution.
time, explains Crawford.

According to reports, Chinas HNW
growth has resulted in a 47% increase
in the amount of money flowing into
Hong Kong between 2012 and 2014.
Similarly, Singapore saw a 32% increase.
ROGER STEEL
Sun Life Financial
For the time being, it seems, Hong Kong

is certain to continue to be a key centre
for Chinese offshore wealth, alongside
Shanghais growing importance.
188
Yet Singapore also has an increasingly

role, given that it has become an important, well-regulated and reputable
wealth hub internationally.
Though not as convenient a base as
Hong Kong, Singapore remains an attractive market for Chinese investors
for its reputation as a stable, peaceful
and affluent country with a vibrant
economy and strong banking sector,
says Jason Lai, founder and chief ex-
[Chinese clients] may

be surprised that their
offshore assets will be
exposed to the government
authorities in China or
adopted new countries.
KEVIN LEE
Zhong Lun Law Firm
ecutive officer, Thirdrock Group.

EDUCATED AND PREPARED
There are various ways that the wealth
management industry as a whole can
make the most of the offshoring of
going to be CRS, other exchange of
holdings in an increasingly transparent
Chinese wealth.
information initiatives and money
and compliance-driven world.
laundering issues. And for Chinese

For many UHNW clients from China,
clients, while they like the idea of
At the same time, however, advisers
for instance, they need to be educated
setting up trusts, many dont really
need to be cautious about exposing
on how wealth should be managed
understand that this involves the
themselves to offences or charges
overseas, properly and professionally,
transfer of control to their trustees.
under relevant CRS or other regimes

by taking too proactive a role in struc-
with optimal results. They also need

to be educated to accept not-too-ag-
CRS is going to have an impact
gressive returns relative to the yields
because it seems that most Chinese
turing advice.
they may otherwise receive from the
clients are setting up structures which
More broadly, insurance, pensions and
domestic China market, says Lee.
are either not compliant with Chinese
other more sophisticated planning tech-
tax laws, or will not be compliant as
niques will become increasingly impor-
Further, and more broadly, many clients
the tax and reporting laws inevitably
tant and plain vanilla offshore structures
from China are not fully aware of the
change, says Howard Bilton, chairman
will be useless.
implications of FATCA and the Common
of Sovereign Group.
To be well-positioned in this way, there
Reporting Standard (CRS). However,

some of them already feel the inconve-
He sees many wealthy Chinese still
are several things that insurers can do
nience of dealing with banks where their
seemingly working on the assumption
to capture and be successful in the
foreign nationalities might have an
that money held offshore in an offshore
Chinese market.
impact such as in cases where they
structure can be hidden from the tax
have become US citizens or a perma-
authorities. It is going to be increas-
According to Steel, these include:
nent resident.
ingly important that any structure set
getting an onshore licence; keeping up
up by a Chinese client (or any client
with the pace of digital innovation and
They may be surprised that their off-
anywhere in the world) works because
online sales; being creative when it
shore assets will be exposed to the
it is legal and compliant rather than
comes to social media promotions, such
government authorities in China or
because relevant tax authorities do not
as on WeChat; selling through banks
adopted new countries, says Lee.
find out that it exists, he says.
and their brokers, and looking at new
Many practitioners agree that the
Such clients need professional advice
for example real estate buyers or soccer
most pressing issue going forward is
on how to properly structure wealth
club members.
and alternative distribution channels,
189
FIRM PROFILE
A generational mind-set to
servicing family wealth
Planning for the future requires a sense of the past. Now, more than ever, it also needs
expert knowledge of the constantly-changing regulations. This is the approach that
Shanker Iyer takes in spearheading Iyer Practice Advisers.
There has always been a tension
his two sons, Sunil and Sanjay, to see
between tradition and innovation. The
things in a similar way.
challenge for advisory firms today is

understanding how to deliver a service
EVOLVING PROPOSITION
that can respond to what clients want
Shanker initially qualified as a Chartered
and what regulators demand.
Accountant in London and was a partner

of a leading accounting firm in the UK
In the past few years, increasing atten-
for more than 10 years before he came
tion has been paid to what tax really is,
to Singapore.
and how it should be paid and where.

The accountancy background is imporBut tax should not be the sole or even
tant because it provides the fundamen-
primary factor driving family wealth
tal tools for any business model.
structures. Advisers should first understand the specific circumstances of the
I came to Singapore in the 1980s with
family, and how to effectively cater for
my UK firm, says Shanker, and I went
both the current and future generations.
back to the UK in 1992. But then the UK
Only once this is determined, can the
economy wasnt very good at that time
structure (and the tax, regulatory and
and so we came back to Singapore and
fiduciary aspects) be effectively planned.
I set up my own practice in 1993.
Shanker Iyer is in a unique position to
Initially he ran a traditional accounting
appreciate the past and invest in the
practice. We are chartered accountants
But accounting and audit were not the
future. He is the Founder and Chairman
by qualification and thats been my ex-
ways into the future. The audit business
of Iyer Practice Advisers, a specialist
perience, so it continued to be the case
in Singapore was expected to decline
advisory firm, and has been grooming
for the initial period.
because of the impending law abolishing
190
SHANKER IYER
FIRM PROFILE
The trust companies tend to do fidu-
The three most impactful developments
ciary work and most of the accounting
in the tax world where advisers must be
firms are largely audit focused, he adds.
up-to-date on their knowledge and

analysis are: Base Erosion and Profit
FINDING A NICHE
Shifting (BEPS an OECD project), a
That evolution has given Iyer Practice
new view of defining where sales and
Advisers the unusual position that it
profits and tax liabilities are declared;
now holds with fruitful relationships
FATCA and the Common Reporting
across financial services, including in
Standard (CRS), the use of automatic
the wealth management industry.
exchange of tax information(AEOI).
We became something in the middle,
Sanjay Iyer, who leads the firms tax
explains Shanker.
practice, takes a common sense view of

all these matters.
Accounting firms dont seem to regard

SUNIL IYER
us a competitor, and, in fact, a number
He thinks BEPS will affect business, but
of them consult us on specialist tax
less with regards to private clients. He
matters which are quite complex and
is also sanguine about FATCA. It primar-
beyond their normal experience.
ily affects those involved with the US.

CRS, meanwhile, is different and will be
The same business model applies to
much more widespread, he explains,
trust companies. They play a more
because it affects everybody. Whether
audit for many companies in the future,
volume game and we are more advisory;
all countries that have signed up to CRS
and so we decided to exit that business.
thats the way we focus the firm.
will implement it at the same time will

be interesting to see.
There was personal and professional
That focus is emphatically towards
logic in deciding to move into advisory.
clients. Many of Iyer Practice Advisers
KEEPING IT SIMPLE
clients are in the private client space.
In general, Iyer Practice Advisers prefers
We felt professionally that we pre-
They may come through corporate
to stick to basics.
ferred to do advisory work, he explains.
structures but, behind these companies,
Audit was becoming over regulated and
even public listed companies, there are
Businessmen can make multi-million
stopped us providing many other ser-
usually families, entrepreneurs and high
dollar decisions very quickly, but when
vices to clients which other-wise we
net worth individuals who want a more
it comes to their personal lives (family
wanted to.
personalised service.
succession planning, wealth planning)

they often take a long time to decide
That was the game changer. We divested
They are very demanding in the quality
because they must think of all the things
our audit business at that time and we
of work and depth of knowledge that
that can go wrong and which often do.
switched our focus to the advisory busi-
they require from us, says Sunil Iyer,
ness, says Shanker. We suddenly became
director, who oversees private client
It can sound like a clich , but I strong-
a very different firm in town.
services and regulatory compliance.
ly feel there is no one formula that works

for everybody, says Shanker.
Today, Iyer Practice Advisers is quite
NEW LANDSCAPE
unlike any other accounting practice,
Knowledge and understanding of trends
Each family is different, the way they
and also quite unlike any traditional
are becoming ever-more important in
do things is different, and the solutions
trust company which typically does not
advisory work. With the changing land-
are different, so we try case-by-case to
give advice (particularly with regards
scape, good advice is imperative to
work with them and give our inputs to
to tax).
ensure clients keep up.
their decisions. The final decision is
191
FIRM PROFILE
always reflective of the clients per-
There is still more to do and to contem-
sonal preference.
plate. For example, one recent development at the firm was its relationship
Inevitably, he and his family have a big
with WTS, the fifth largest German tax
influence on the culture of Iyer Practice
consulting firm after the big four, with
Advisers. I guess being a family busi-
an international network. The upshot
ness we dont have the type of turnover
was dealing with some high-level tax
at the senior level that other firms might
issues of German multi-nationals that
have, he says.
are doing business in Asia, in turn

helping Shanker and his team to grow
A four-generation family of chartered
the firm because it had to bring in ex-
accountants does have a certain flavour.
pertise that was in need.
There are firms who have much more
The relationship was a start but it also
resources than we would ever have, so
gave a further impetus to the culture

SANJAY IYER
We want to be focused on our strategy.

So we dont see much change. The type of
work could change, it might become
more complex, but I think the better we get
the better we can advise our clients.
Fiscal Association, and Chairman of the

Tax Policy Committee of the Singapore
International Chamber of Commerce.
This doesnt equate to cronyism. I do
not mean that they do favours to us,
but the fact is we know how the system
works and we know the people personally, he explains.
we have to know our place in the market
and growth of the business, he explains.
and not try and compete head-on with
It actually forced us to build up our
the big players - it doesnt make sense.
team (for instance in transfer pricing)
We think people get a certain comfort
So we have a niche play and we are very
much sooner than we ever would have
when they come to us because we are
happy in it.
done. So we are happy about that.
not new in town and experimenting.
NO STANDING STILL
At the same time, Shanker is a strong
Iyer Practice Advisers now has offices
believer in tradition as well as in rela-
Concludes Shanker: We want to be
in Singapore, where it has close to 70
tionships.
focused on our strategy. So we dont
We are established here.
see much change. The type of work
staff, and in Hong Kong, with around

15 employees. But Shanker is still
He has been President of the British
could change, it might become more
looking for growth.
Chamber of Commerce and the Euro-
complex, but I think the better we get
pean Chamber of Commerce in Singa-
the better we can advise our clients.
Areas where we currently are seeing
pore as well as Chairman of Singapore
most demand and find the most inter-
the International Chamber of Com-
Iyer Practice Advisers has clearly evolved
esting now are international tax and
merce. He is currently Chairman of the
into an advisory firm in response to client
regulatory compliance services.
Singapore branch of the International
needs and changing times.
192
EXPERT INSIGHTS
Knocking on Asias onshore

opportunity
Emerging trends in Asia in terms of how and where clients have their wealth managed,
give private banks with the resources and expertise an enticing source of work onshore,
especially in China, says Jonathan Hubbard of UBS Wealth Management.
One of the biggest opportunities that
CHINA FOCUS
UBS Wealth Management foresees for
China clearly presents the biggest
its business in Asia over the next 15 to
appeal, particularly as it emerges as a
20 years is providing onshore wealth
market for such onshore services. And
planning services for domestic clients
this trend is only expected to continue
for certain markets.
in line with the changing dynamics of

the economy over the next 10 years.
As in the past, an increasing amount of

wealth continues to be created at home
For example, it will start depending
rather than overseas.
more on domestic consumption rather

than exports, and a lot of wealth will
The vast majority of the growth of
increasingly be generated from within.
wealth [in Asia] is going to be onshore,

predicts Jonathan Hubbard, head of
The discussion Hubbard is engaging in
wealth planning for UBS Wealth Man-
at the moment to gauge the potential in
agement in Asia Pacific.
China is about what can really be done

today around structures such as a family
International banks are unlikely to get
trusts and insurance for succession plan-
too close to the entrepreneurs busi-
ning onshore.
JONATHAN HUBBARD
nesses, due to the individuals ties to

their commercial banking provider.
There has been a developing theme

towards this over the last two or three
However, the need for services like suc-
years, as some of the Chinese trust
This highlights the possibility of an estate
cession planning, lifecycle planning and
companies move away from just being
planning business developing in China,
more is a big enough draw card.
deposit takers, he adds.
explains Hubbard.
193
FIRM PROFILE
Sun Life embarks on path to tap

the wealth pipeline
With a new chief executive in Hong Kong, Sun Life finds itself at the start of a
strategic journey which will reposition the firm to be able to deliver needs-based,
holistic financial planning.
After 124 years established itself as one
more from their wealth managers, insur-
of the leading players in Hong Kongs
ance companies have been rethinking
insurance and MPF markets, Sun Life
their business.
Financial is ready to embark on a new

journey again.
It is more than evident than ever to

Dehni that clients no longer want to deal
Assuming its new chief executive officer,
with multiple advisers.
Jason Dehni, can achieve all the goals

he has set out, he will have transformed
Our clients want one relationship
the business to deliver a broader prop-
manager, not one for their investment,
osition with a finger in every slice of
one for their pension and another for
the wealth management pie.
insurance, he emphasises. The writing

is on the wall in Hong Kong.
Further, Sun Life as an organisation

wants to be best-placed to work with a
At the same time, Asia is now a more
wider variety of organisations going
important region for Sun Lifes global
forward, given that the traditional
business than ever before.
agency model looks to have run its

course as the distribution channel of
So the push to grow market share in the
choice in Hong Kong.
region, and match the scale of its busi-
JASON DEHNI
Sun Life Hong Kong
ness globally, gives the new strategic

The vision reflects an evolution under
direction further fuel.
way across the region, explains Dehni,
In his role as chief marketing and distri-
who joined the firm from Manulife in
REDEFINING THE OFFERING
bution officer for Manulife in Asia, he
May 2016. With the next generation of
Dehni is no stranger to the kind of stra-
helped transform the end-to-end advi-
young and savvy clients demanding
tegic shift he envisages in his new role.
sory sales model, which included a com-
194
plete redesign of its recruiting, training,
versal life proposition, which is set to
based on trust, advice and delivery of
technology and product offering plat-
make its debut in the third quarter.
service, he explains.
It will be our signature product for
His commitment to this involves taking
He now plans to lean on this experience
HNWs, explains Dehni. Clients have
on board as much client feedback as he
to repeat that with Sun Life.
a choice, but when they come to a Sun
can get, in order to continually ensure
Life adviser, we are going to offer them
he and his staff provide the desired
In line with this, his goal is to stretch the
solutions that we believe meet their
consistent experience.
boundaries of the firms offerings to
financial needs.
form, including wealth management.
This will also involve reviewing internal
complement its life insurance and pension

services with a spectrum of wealth plan-
But the overall goal goes beyond just
processes and policies to identify areas
ning and investment expertise.
the products individually; it requires
for improvement.
integration so that each solution creates

He can then say with conviction that the
complementary value to a clients
However, the biggest challenge he faces
firm can meet the different financial and
overall financial plan.
is how to get Asian clients to look

beyond their short-term, tactical ap-
protection needs during the different

stages of the clients lives, under one
Geographically, Dehnis immediate
proach towards focusing on longer-term
roof. It is part of our DNA, he adds.
focus is to serve the needs of people
goals such as retirement planning and
across various income spectrums in
saving for the future.
STEP-BY-STEP
These changes, though, are not going to
come about quickly.
This requires a certain mind-set, combined with a lot of training, support,
technology, back office infrastructure,
adding mutual funds to our own platform, governance and, obviously, licens-
Our clients want one relationship manager, not one for

their investment, one for their pension and another for
insurance. The writing is on the wall in Hong Kong.
ing, explains Dehni. So it is a journey

we will be taking over the years to come.
Top of his agenda to move up the ladder
as a fuller-service wealth manager is to
drive needs-based financial planning as
Hong Kong. Saying this, China will obvi-
But he doesnt subscribe to the notion
Sun Lifes core offering.
ously remain important as the firm
of expecting clients to change overnight,
continues to focus on the needs of PRC
without helping them to change.
The firms asset management division
clients in Hong Kong.
plays an important role too enabling
Instead, Sun Life plans to leverage tech-
it to offer a multi-manager platform.
QUALITY NOT QUANTITY
nology to give investors a glimpse into
This is a point of differentiation for us,
Yet, while products are inevitably im-
the future.
says Dehni. Our clients value it, the
portant, they offer relatively limited
agents value it, and the market values
scope for differentiation.
it. We want to extend this platform to

our agents and clients.
This mind-set can be changed through

education and by using technology in a
Instead, Dehni is looking to find a niche
way that it can help them envision their
for the wealth management offering by
life after retirement, says Dehni.
And for the HNW population, Sun Life
focusing on the quality of advice. And
Engaging clients through such tools will
is currently developing a premium uni-
he wants to create a value proposition
encourage them to continue saving.
195
EXPERT INSIGHTS
Broadening the insurance focus

on Hong Kongs wealthy
Generali is bringing a range of new life insurance solutions to meet growing appetite
among the citys HNW and affluent populations, explains Thomas Young.
The increasing awareness and open-
The product itself has been around in
ness among affluent HNW individuals
Asia for a long time in Hong Kong, and
in Hong Kong about the need for pro-
has been offered to date by insurance
tection in various formats is creating
companies such as AIA, Transamerica
new opportunities for some of the more
Life Bermuda, Sun Life Financial,
proactive life insurers.
Manulife, HSBC, Met Life, AXA (more

recently) and others. For Generali,
Generali counts itself among them.
meanwhile, the focus is to build on

relationships with brokers.
It has set up a new life insurance business in the market to target these
COMPETING AT THE TOP END
customers with a product range that
According to Young, there is a lot more
includes a range of traditional life, unit-
to doing these products successfully
linked and universal life (UL) insurance
than just the price.
targeted at the wealthier segments of

the population.
He is referring to various aspects

around the support and services clients
For Thomas Young, in particular, as
get. Everyone is trying to get into the
head of the firms HNW business, the
HNW space because its the least
new UL offering in Hong Kong is espe-
crowded compared with retail.
THOMAS YOUNG
Generali
cially exciting.
Yet standing out amid those insurers
This is a new proposition of Generali.
competing in the HNW space is obvi-
First, he says the firm currently offers
We have never done this before any-
ously key. And Young believes that
most competitive UL product in terms
where globally.
Generali has a few unique selling points.
of price. Secondly, a novel element he
196
highlights is an underwriting class
The multi-dimensional nature to UL
which is currently not being offered by
is an important aspect of the market
anyone else: an underwriting class for
that Young says needs to be better
extremely healthy clients.
highlighted to clients.
We reward customers who are healthy
The current challenge that providers
with lower premium, explains Young, so
face in this segment, for example, is
we pass the savings to the customers.
the fact that clients and potential

clients are focusing on one particular
At the same time, he cites innovation in
product offering.
terms of Generali being the first insurer

of its type to offer the product to
I think thats just because clients are
Chinese residents of 51 cities in China,
not aware of the many different options
with the same rating as in Hong Kong.
available, he adds.
The current challenge that providers face in this

segment... is the fact that clients and potential clients
are focusing on one particular product offering.
Thats just because clients are not aware
of the many different options available.
Indeed, the business out of Hong Kong
For example, critical illness is another
services clients from around the region,
area where clients can look at getting
dominated by individuals from main-
protection on a living benefit cover.
land China and Taiwan, in addition to
This is where Generalis new offering,
the population in Hong Kong.
called La Vita, comes into play (see

adjacent box).
A MULTI-DIMENSIONAL
Expanding the Generali

life insurance offering
to HNW
Generalis Sigillo Universal Life
Plan reflects the inspiration
behind the firms solution for its
most valued clients.
It enables them to pass on their
unique heritage and legacy to
future generations.
Key product features include:
lifelong protection, adjustable
death benefit, guaranteed
crediting interest rate lock
options, guaranteed minimum
crediting interest rate, highlyflexible premium options,
product transparency, easy
access to liquidity, and free
partial withdrawal.
Meanwhile, La Vita Critical
Illness & Savings Plan is designed
to cater for clients different
needs through their life stages
such as planning for retirement
or a childs education with
guaranteed income feature and
multiple risks coverage.
Key product features include:
wealth accumulation with
life and waiver of premiums
protection, comprehensive
coverage for 100 illness
protection until the age of 100,
guaranteed monthly income
options, guaranteed crediting
interest rate lock options,
guaranteed minimum crediting
interest rate, highly-flexible
premium options, product
transparency, and easy access
to liquidity.
OFFERING
The living benefit segment is under-
The focus for many of the clients that
served at the moment, says Young,
Young sees buying UL should start with
and the annuity gives clients the
a growing understanding of the prod-
option to have a regular income stream
ucts large cover.
for the future.
This enables them to do much more
He is a strong proponent of the idea of
than just protection.
giving clients more options.
They can use it for wealth transfer,
Banks also need to look at how they
legacy planning, estate equalisation
can service a clients more comprehen-
side, he explains. And that protection
and even key-man protection, he says.
sive needs, including the protection
is much more than just life.
197
FIRM PROFILE
Tokio Marine carves life

insurance niche in Singapore
James Tan of Tokio Marine Life Insurance Singapore Ltd. explains to Hubbis how the
firm is leveraging its first-mover advantage to establish a new niche in developing
solutions for the insurance needs of Japanese corporates.
Tokio Marine Life Insurance Singapore
This is an incredible accomplishment
Ltd. (TMLS) has been recently named a
for the first and only Japanese life
Tier-1 Significant Insurer by the Mon-
insurer to have established a successful
etary Authority of Singapore, recognis-
foothold on local shores.
ing its status as a direct life insurer with

at least SGD5 billion in assets.
Behind the story of TMLS strong growth

trajectory is a core focus on its group
With this, TMLS has not only maintained
insurance in-force business, which has
a leading position in Singapores fierce-
reaped excellent results for the firm.
We see great potential in the J-Business segment,

and our long-term objective is for TMLS to become the
choice insurer for Japanese companies in Singapore.
JAMES TAN
TMLS
ly competitive life insurance landscape,
From Q1 2015 to Q1 2016, group insur-
This performance has been driven by
but also expanded one of the areas of
ance business at TMLS outstripped the
the J-Business segment TMLS new
growth the Japanese group business
industrys growth by nearly six times
niche in the firms group insurance busi-
segment (J-business).
(Source: LIA Singapore).
ness, which was first started in 2015
198
and now attaining a year-on-year
first-mover advantage and unique areas
looking to gain inroads into the South-
growth of 20%.
of expertise at TMLS.
east Asian market, one of the largest in

the world.
According to James Tan, chief executive
THE J-BUSINESS OPPORTUNITY
officer at TMLS, J-Business is specifi-
As at end-2014, nearly half of the Japa-
As Japanese companies continue to in-
cally tailored to the insurance needs of
nese companies in Singapore hosted
crease their investments in Singapore,
Japanese corporates, leveraging the
regional headquarter functions, accord-
notes Tan, insurance will naturally
insurers expertise in holistic, compre-
ing to a survey conducted by the Japan
emerge as an important consideration
hensive and customised group insur-
External Trade Organisation (JETRO)
for them.
ance solutions.
Singapore, a Japanese government-re-
At present, J-Business is the fastest-
lated organisation promoting external
Japanese companies will be looking for
trade and investment.
a partner whom they can trust and work
growing among TMLS group business
effectively with, he adds. This poses a
segments and accounts for approxi-
The trend of Japanese companies setting
critical gap in the local life insurance
mately 10% of the group insurance
up regional headquarter operations in
landscape that can only be filled by an
business. Tan, an industry veteran with
Singapore looks set to continue, with
insurer who is already familiar with the
decades of experience across Asia,
another 30% noted as considering similar
ubiquitous workings of Japanese busi-
Middle East and the US, intends to
moves in the same survey. It is easy to
nesses, and can adapt their offerings to
further develop this niche.
understand Singapores appeal to the
anticipate and address the specific

needs of these companies in a new
foreign market.
TMLS UNIQUE POSITIONING
Japanese companies who are venturing into Singapore

need a partner whom they can trust to understand their
business priorities and concerns, and develop solutions
in anticipation of their needs in this new market.
At the heart of its strategy to capture

and grow business relationships with
Japanese companies in Singapore is
TMLS expertise in developing tailored
solutions, along with its heritage as part
of the Tokio Marine Group, one of the
largest insurance groups in the world
and a household name in Japan.
As an insurer and adviser to our clients,
We see great potential in the J-Busi-
many Japanese companies keen on
our business at TMLS is founded on trust
ness segment, and our long-term objec-
setting up regional headquarter func-
and understanding, explains Tan.
tive is for TMLS to become the choice
tions in the country.
insurer for Japanese companies in Sin-
Japanese companies who are venturing

The city-state has established a formi-
into Singapore need a partner whom
dable reputation as one of the most
they can trust to understand their busi-
As the pioneer in the J-Business niche,
business-friendly countries in the world,
ness priorities and concerns, and
we are already working with nearly 200
with a comprehensive financial services
develop solutions in anticipation of their
Japanese corporate clients across a wide
infrastructure, strong risk management
needs in this new market.
range of industry sectors including con-
ecosystem and pro-business laws.
gapore, he says.
struction, retail and logistics. In the year
Adds Tan: As a Japanese company
ahead, we will be exploring new avenues
Its strategic position in the region also
which has also embarked on our own
to engage the Japanese business com-
means that Singapore is seen as an ideal
expansion into Singapore, we are
munity in Singapore, leveraging our
starting point for Japanese companies
naturally able to understand the intri-
199
FIRM PROFILE
cate concerns of our Japanese corpo-
The firm is already an established
saving towards a pre-determined sum,
rate clients, especially in relation to
member of the Japanese Chamber of
individual plans should be developed
the market entry process. Our solu-
Commerce and Industry (JCCI), and
based on lifestyles and spending habits.
tions at TMLS are therefore informed
Tan believes that key to further expan-
by our expertise in bespoke offerings,
sion of the J-Business is continued
Adds Tan: The worksite sessions allow
and our first-hand understanding of
engagement within the community.
us the time and flexibility to explain this
Japanese corporate culture and the

market entry process.
In staying true to the Good Company
advice at length, and to better underThis year, TMLS J-Business team has
stand our customers thinking and ap-
embarked on a series of initiatives to
proach to retirement planning. This in
reach out to the community.
turn helps us to come up with retirement
philosophy of the Tokio Marine Group
solutions that are more suited to their
and the distinctly Japanese concept of
These include worksite events in infor-
omotenashi (to entertain guests whole-
mal and intimate settings, such as lunch-
heartedly), TMLS is constantly on a
time talks and seminars, where TMLS
Other initiatives that TMLS has
quest to perfect its J-Business approach
experts can share their knowledge with
adopted to establish its Japanese iden-
right down to the smallest detail.
employees at Japanese companies.
tity and build camaraderie among the
lifestyle preferences.
It speaks volumes about the insurers

standards in client servicing that for
instance to ensure the effectiveness
of the J-Business team in developing
solutions for Japanese corporates,
some of whose key decision-makers
may be more comfortable conversing
in Japanese, TMLS has ensured the JBusiness team comprises fluent Japa-
Our current overall persistency in renewal

ratios stands at above 95%, and this
gives us confidence that we are
heading in the right direction.
nese-speaking product experts.

In Tans eyes, these efforts in sincerity
go a long way. Our track record bears
testament to the TMLS teams efforts
These worksite events enable our
Japanese business community include
in ensuring long-term, sustainable
experts to engage employees on a per-
sponsorship of outreach events.
client relationships based on trust and
sonal level, says Tan.

These include Japan Hour, a popular
satisfaction, he says.
We make it a priority to cover financial
Channel NewsAsia programme that
Our current overall persistency in
planning topics that they are genuinely
spotlights Japanese culture.
renewal ratios stands at above 95%,
interested in, such as writing wills, re-
and this gives us confidence that we
tirement planning or MediShield Life.
Our commitment to the Good

Company principles of integrity and
are heading in the right direction with

our dedicated efforts in strengthening
He shares that the most frequently-
stakeholder trust will continue to be
our J-Business approach, he adds.
voiced concern is retirement adequacy.
the cornerstone of our work in the

decades to come, he explains.
FORWARD VISION
The most common question we en-
As the insurer for nearly 200 Japanese
counter in discussing retirement plan-
Being an international organisation
corporates in Singapore, TMLS is on
ning with employees is the magic
allows us the opportunity to expand our
track to choice-insurer status for the
number that they need to save towards,
business prospects, while keeping our
Japanese business community.
he explains. Our counsel, is that beyond
Japanese heritage close at heart.
200
2016
SUMMARY
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WEALTH-THINK 2015
EXPERT INSIGHTS
Eyeing healthy profits from a

more mobile China
The rapid growth in Chinas insurance sector is fueling Bupa Globals desire to craft
medical plans tailored to the countrys affluent population. Rainbow Pan reveals the
vision behind the strategy.
According to data from the China Insur-
says Rainbow Pan, the firms general
ance Regulatory Commission (CIRC),
manager for the Greater China region.
the mainland became the worlds thirdlargest insurance market in 2015 with
And with more of Chinas wealthier
an annual growth rate of 13.4%. And
population becoming not just globally
from 2010 to 2015, the market saw an
minded, but also internationally mobile,
increase in insurance premiums from
there is good reason for optimism.
RMB1.3 trillion (USD196 billion) to

RMB2.4 trillion.
Further, the firm already works with a

local partner, Alltrust Insurance, which
The Chinese government has also ini-
has over 200 offices across the main-
tiated major reforms to provide cus-
land, licensed to write medical insurance
tomers with access to improved
business and is the local insurer for
medical services.
products issued under another agreement Bupa has with Hang Seng Bank.
Eyeing these trends, Bupa Global aims

to play a big role in the market and
So after tapping into the key initial op-
even see potential for its portfolio in
portunities in Beijing, Shanghai, Guang-
mainland China to overtake that of
zhou and Shenzhen, a host of other
Hong Kong within three years in terms
cities are on the radar, adds Pan.
RAINBOW PAN
Bupa Global
of international private medical cover.

CONSISTENT OFFERING
Despite a relatively low base at the
Pan says she sees first-hand evidence
trip to the US West coast. One can see
moment in China, Bupa Global has been
of the significant rise of international
them where ever you go travelling in
investing a lot in Asia and we see this
mind-set of Chinese nationals during
the world these days. So they need
part of the world as a growth region,
her visits overseas, including a recent
good cover just in case. And it doesnt
202
matter where they go. Thats the op-
ance company for their medically-re-
Through this arrangement, a range of
portunity I see, she explains.
lated assistance services.
global medical insurance products
Service-wise, what Bupa offers in main-
Patients get informed about the best
Hang Seng Banks personal and cor-
land China is comparable with whats
doctors available, and if required, Bupa
porate customers.
available in Hong Kong.
will confirm the appointment at no
and services are made available to
extra charge, says Pan.
DEMAND DRIVING TRAJECTORY

One of the main reasons for the growth
For instance, it offers the Bupa Global

Health Plan range, a new product
Yet all plans still come with annual
in private medical care in mainland
launched in 2015 as a tiered proposition
health check-ups and medical con-
China stems from the desire among the
with pricing to reflect this structure.
cierge services, including emergency
ever-larger numbers of wealthy for
assistance and evacuation, repatria-
higher-quality services.
We will be co-branding the Global
tion, second opinion and a round-the-
Health Plan range with Blue Shield
clock helpline.
But concerns among these individuals

about the cost of getting access to
Global, as part of the next phase of our

partnerships and this will be delivered
EXPANDING ITS CHANNELS
this in comparison with state-run
in a phased approach, starting in Asia
IN CHINA
facilities.
with Hong Kong, explains Pan.
Partnerships are key to the success of

Bupa Globals strategy in China.
The hospitals which are empanelled

by Bupa Global will seek pre-authori-
The coming together of the two names

means consumers who require global
Given its target market of wealthy in-
sation for direct billing of our custom-
coverage can now have access to the
dividuals and families, the firm looks
ers, explains Pan.
largest network of health care provid-
to intermediaries like private banks
ers worldwide.
and wealth management firms to help
Our care managers, who have a
reach this audience.
medical background, will look at the
This combined strength, knowledge

and expertise means customers can be
confident in knowing that they have
access to quality health care when and
where they need it, she adds.
More specifically, this involves a range
of premium policies for the affluent to
Bupa Global has been investing a lot

in Asia and we see this part of
the world as a growth region.
HNW audience.
Pan explains that this came about after
some extensive research revealed that
customers prefer something which is
The bancassurance channel is also
treatment offered by the doctors, and
simple and easy to understand.
proving increasingly popular.
then help customers better understand

their medical condition, she adds.
Within Bupas Global Health Plan
A 10-year exclusive partnership with
range, a product called Ultimate has
Hang Seng Bank began in Hong Kong
They can then suggest the best pos-
no annual and lifetime limits.
in September 2014.
sible alternative treatment, doctors

and/or hospitals related to the cus-
And the level of medical concierge
A similar venture got off the ground
tomers medical conditions in order to
service is akin to customers having
in China in September 2015, also with
give the policyholder more options,
their own secretary within the insur-
Hang Seng Bank.
explains Pan.
203
EVENT HIGHLIGHTS - DIGITAL WEALTH - ASIA 2016 - JUNE
Turning digital into reality

Speaking at Hubbis flagship annual Digital Wealth event in Singapore in mid-June 2016,
senior industry practitioners highlighted some of the most pressing considerations and
objectives to ensure institutions get moving in the right direction along their inevitable
digital path.
Financial institutions are re-assessing
to offer to clients to service their wealth
their strategies and engagement of all
management needs.
kinds of technology.
Yet disruption in any dramatic way looks
Amid all the hype and talk among banks
unlikely. So management need to focus
about them looking to enhance their
on how to evolve and enhance their
digital propositions and offer clients
businesses to thrive, not wither, in
more via these channels, they need to
todays challenging environment.
act if they want to address the real

challenges they still face. While the
This is needed in private banking, for
demand for digital wealth management
example, given the move away from
is growing among Asian investors,
purely face-to-face conversations, to a
many traditional players are struggling
landscape where clients can interact
to respond.
with an individual adviser as well as the

institution through different and mul-
For those institutions in search of in-
tiple channels. Plus, the trend is heading
novation and digitisation for their
in a direction where it will be possible
wealth management business, there-
for customers to transact directly
fore, they need to carefully consider
through the bank.


Appway
EY
IMTF
Pershing
IRESS
SIX Financial Information
Vermilion Software
Assentis Technologies
Orbium
Synpulse
Temenos
Thomson Reuters
end solutions, some industry leaders
how they work ever-closer with (the

right) fintechs as the former rely on the
Plus, while a lot of people get most
think the right approach is to start at the
latter for something interesting and new
excited and focused in relation to front-
back end especially given regulations

and operations are critical areas of
concern for many senior management.
One of the principal premises of roboadvisory, meanwhile, has always been to
change the way of thinking about investing towards being more goals based. This
resonates with many investors. Institutions will increasingly see the advantages of going down this route, to
ensure their end-customers remain
satisfied and can be self-directed.
204
Adrian Gostick
Andrew Koh
Andy Feitknecht
Charles Wong
Dirk P Sibiet
BondIT Asia
China Construction Bank
Assentis Technologies
Priv Holdings
ABN AMRO Bank
Dr Lee Ng
Eddy Tai
Evy Theunis
Frank Henze
Frank Troise
MetLife
Bank of Singapore
DBS
Gary Mellody
Antony Lewis
Joyce Tan
Julia Walker
Ketan Samani
EY
Bitsonblocks.net
Joyce A. Tan & Partners
Thomson Reuters
Luke Janssen
Mark Buesser
Mark Nelligan
Neal Cross
IMTF
Pershing Securities
Mark Wightman
Tigerspike
EY
DBS Bank
Ned Phillips
Peter McMillan
Pranav Seth
Sandipan Ray
Bambu
Thomson Reuters
OCBC Bank
Leonteq Securities
205
Sanjoy Sen
Stefan Arn
Steve Monaghan
Urs Lichtenberger
Valerie Bruce
ANZ
UBS
AIA
Credit Suisse
Alessandro Tortelli
Bhaskar Prabhakara
Jaideep Billa
Jason Hoang
Jeroen Buwalda
Appway
WeInvest
Intellect Global Consumer Banking
IRESS
EY
This event has been very important in highlighting and

re-enforcing the issues the banks face and the challenges
in terms of moving forward.
Ravish Khanna, Vice President, Change Management, APAC, BNP Paribas Wealth Management
Zoe Niu
Appway
206
EXPERT INSIGHTS
A process to digitalisation
Artificial intelligence, machine learning and other digital capabilities make it possible to
connect multiple information sources and systems to come up with solutions and views
to ensure advisers are more productive, says Peter McMillan of Thomson Reuters.
Digital platforms have gathered a lot
explaining that it isnt practical for rela-
of momentum in the US over the past
tionship managers (RMs) to join the dots
12 to 36 months, says Peter McMillan,
to help them understand what is hap-
head of wealth management for
pening in the market, how it relates to
Thomson Reuters in Asia.
their CRM database and the suitability

for their client.
This shows the focus on enhancing digital

platforms with the aim of reaching more
In line with this, creating a smooth com-
customers and provide better advice, to
munication path is also a key compo-
provide a better user experience.
nent, adds McMillan.
In Asia, many banks are involved with
An RM should have multiple ways to
accelerators, innovation labs and other
connect with clients, to get the informa-
initiatives to try to understand the
tion they need, on the device preferred,
fintech arena and enhance platforms
and when they want it. Plus, it should
with capabilities that enable them to
connect to all the other databases if
better service clients, says McMillan.
they need that information.
Private banks, in particular, are looking
This is essential from a suitability per-
at ways to address the margin, regula-
spective, for example, explains McMil-
tory and investment pressures they face.
lan, to know what investment product
PETER MCMILLAN
Thomson Reuters
is pre-qualified.
CREATING DIGITAL PLATFORMS
Ultimately, he says this reduces the time
One of the first steps institutions should
By extension, this can integrate model
RMs spend on research and processing,
take along this digital journey is to
portfolios, to assist in comparisons with
to free them up to focus on prospecting
connect multiple databases, he advises,
client portfolios at different risk levels.
and servicing clients.
207
EXPERT INSIGHTS
Why banks must rely on

fintechs
Ralph Mogicato, a fintech angel investor, explains why banks and fintechs will work evercloser as the former rely on the latter for something interesting and new to offer to clients
to service their wealth management needs. Disruption in any dramatic way looks unlikely.
Because most banks are not innovative
But there will be no brave new world
by nature, they will increasingly rely on
along the lines of earlier predictions.
fintechs to drive client interactions and
Instead, Mogicato says banks need to
engagement within wealth manage-
work out how to get the most value for
ment. As a result, they are more eager
their wealth management businesses
than ever before to get these companies
from collaborating with fintechs today.
on board.
And the consequences for banks which
This is according to Ralph Mogicato, an
dont take these developments seri-
entrepreneur and independent senior
ously will be severe, he predicts. In the
adviser, who says this explains the hype
medium term, they will be less interest-
and potentially large bubble emerging
ing and relevant to their clients. And in
in this space.
the long term, they wont be in business

at all if they dont offer attractive prices,
This also explains the shift in what fin-
good execution and a quality service.
techs are focusing on. The original

fintech companies were supposed to
A NEW FINTECH FOCUS
RALPH MOGICATO
be disruptive. However, today every
Against this backdrop, now is the
Angel investor and entrepreneur
start-up which writes a line of [program-
moment for more fintechs to enter the
ming] code calls itself a fintech, says
limelight given that their agility and
Mogicato. There are not many firms
pace provide them with the opportu-
which are genuinely disruptive.
nity to implement their ideas without

the baggage of legacy systems.
to those banks shackled by a heavy level

of financial regulation and compliance
As a result, while some fintechs will

inevitably be successful, many wont
It is in this way which they will be criti-
issues. Testament to this trend is the
survive for long.
cal in providing a competitive advantage
number of innovation labs and accel-
208
EXPERT INSIGHTS
erator programmes which have sprung
exist, but they will have been able to
up around the world and initiated by
use fintechs in ways to help to trans-
some of the worlds largest banks.
form their businesses.
Further, a recent study by Accenture of
To get to this stage, however, more
global investment in fintech ventures
banks need to start focusing on change
in the first quarter of 2016 showed that
management. If they dont get the
this reached USD5.3 billion, a 67% in-
basics right, such as the right core plat-
crease over the same period last year.
form and clean up their application
The report also noted that the percent-
landscape, then they will fail, explains
age of investments going to fintech
Mogicato. They will prove to be too
companies in Europe and Asia Pacific
slow and its too expensive to survive.
As a result, he is positive about fintech.
What to look for when

investing in a start-up
It is generally quite easy for
fintechs to raise money and get
a first meeting. The elements
they need to survive over time,
however, include:

nearly doubled, to 62%.

Perhaps most notable about the report,
Banks must be more focused on their
and backing Mogicatos observations,
client and their needs, which means
is that collaborative fintech ventures
better products and faster execution.
those primarily targeting financial
Banks can do more with start-ups which
institutions as customers are gaining
can produce software for business-to-
ground over so-called disruptive
business applications.
A good and highly-motivated

founder team
A good simple idea
complexity is not good
Fast execution of the idea
Find one or two existing
clients using the product
or service
Payment-oriented firms, for example,

and those at the retail end of the busi-
players that enter the market to

In particular, the back-end must work
ness with customers as their focus, are
and be flexible, and straight-through
going to be big the most likely among
For example, funding for collaborative
processing is a crucial component of
all fintechs to become the future Ubers.
fintech ventures, which accounted for
this. But this is a key area of the business
38% of all fintech investment in 2010,
which most banks have ignored. They
Robo-advisers will be the other big
grew to 44% of funding in 2015, with
neither renovated what they have
disruptive force, with the more success-
the remaining investments made in
already, nor put in place a new one.
ful ones which get the formula right to
compete against those institutions.
be the defining element of wealth man-
ventures competing with institutions.

Without this, what most banks have,
agement driving the future of advi-
Yet, the proportion of competitive
says Mogicato, is akin to putting a Ferrari
sory and marketing in the near future.
fintech ventures in Europe and Asia is
engine in an old-timer it wont work.

The game-changing firms, therefore,
much higher than in North America,

reflecting the earlier stages of maturity
Yet the banks arent the only firms in the
are those which can be unencumbered
of fintech markets, outside of London.
ecosystem which need to adapt. Core
by the constraints of the traditional way
banking providers such as Avaloq and
of thinking in wealth management.
However, while so-called disruptors
Temenos, for example, are confronted
may compete against banks at first, they
by new technologies such as blockchain.
Yet banks need to do more in their

pursuit of fintech. They need clearly
often end up aligning with them through

investments, acquisitions and alliances,
These firms have responded in other
identified long-term goals in collabora-
said the report. It highlighted BBVAs
ways, by building their own app stores
tions with such firms such as increas-
recent stake in Atom, a mobile-only
where banks can plug into their plat-
ing the companys revenue or profit.
bank in London that launched last week.
forms new solutions from start-ups.
DRIVING CHANGE
SET FOR SUCCESS
they offer is tangible with valuable
In the years to come, Mogicato believes
It has also become clearer which kind
output. This will prevent them falling
that many financial institutions such as
of fintech has the biggest potential to
prey to cost-based decisions when pres-
banks and insurance companies will still
create a splash.
sures increase, explains Mogicato.
For fintechs, they need to ensure what
209
EXPERT INSIGHTS
Turning digital into reality

Speaking on the sidelines of Hubbis flagship annual
Digital Wealth event in Singapore in mid-June 2016,
senior industry practitioners highlighted some of the
most pressing considerations and objectives to ensure
institutions get moving in the right direction along their
inevitable digital path.
Financial institutions are re-assessing their strategies and engagement of all
kinds of technology.
Amid all the hype and talk among banks about them looking to enhance their
digital propositions and offer clients more via these channels, they need to act
if they want to address the real challenges they still face. While the demand for
digital wealth management is growing among Asian investors, many traditional
Delegate, speaker and

sponsor summary

players are struggling to respond.

For those institutions in search of innovation and digitisation for their wealth
management business, therefore, they need to carefully consider how they
work ever-closer with (the right) fintechs as the former rely on the latter for
something interesting and new to offer to clients to service their wealth
management needs.
Yet disruption in any dramatic way looks unlikely. So management need to
focus on how to evolve and enhance their businesses in order to thrive, not
wither in todays intensely-challenging environment.
Against this backdrop we designed our flagship annual digital wealth event
in Singapore.
DRIVING INNOVATION AND EVOLUTION
Digital disruption is continuing to influence private
banking, with a move away from purely relationship
manager (RM)-driven, face-to-face conversations, to a
landscape where clients can interact with an individual
adviser as well as the institution through different and
multiple channels. Plus, the trend is heading in a
direction where it will be possible for customers to
transact directly through the bank.
210
More than 35 high-profile

speakers and 330 attendees
Delegates included CEOs,
COOs, heads of technology
/ digital, and other senior
practitioners attended
from a mix of Private Banks,
Retail Banks, Insurance
Companies, Independent Firms
& Family Offices, and Asset
Management Firms
Sponsors: Appway, EY, IMTF,
Intellect Design Arena,
Pershing Securities, Allocated
Bullion Solutions, IRESS, SIX,
Vermillion, Assentis, Orbium,
Synpulse, Temenos, Thomson
Reuters
EXPERT INSIGHTS
WHICH OF THE FOLLOWING IS THE TOP TECHNOLOGY-RELATED

PRIORITY IN ASIAN WEALTH MANAGEMENT?
55%
Key topics and themes

Enhance the client experience

Create digital advice plaorms
(to lower costs, boost efficiency)
Automate risk / compliance processes
Ensure connecvity between internal

& external systems
23%
8%
14%
Source: Hubbis Digital Wealth - Asia 2016, Singapore
In line with this, fintech is having a big impact on this space as a catalyst to
spur innovation at traditional organisations across the industry, and more
Technology - its role in the

future of wealth management
Digital enablement redefining the client
experience
Change management or
change the management?
Getting your digital bank
ready
Fintech: fantasy or reality?
Regulation and compliance what can technology really do
to help?
What will you be in the
future: a platform? A
product manufacturer? Or a
distributor?
Innovation
quickly, than would be the case if these disruptors didnt exist.

As a result, the market will become increasingly fragmented, but complete
disruption is unlikely.
Indeed, some practitioners believe the change is coming more from the tech
aspect rather than the fin element.
Further, it is not a process which can happen overnight. It also takes time to
convince all stakeholders and staff about the right way to do this.
In addition, while a lot of people get most excited and focused in relation to
front-end solutions, some industry leaders think the right approach is to start
at the back end especially given that regulations and operations are critical
areas of concern for many senior management.
60%
The proportion of respondents who said

technology should play an offensive role as
part of the strategy to expand the offering
to drive revenue
Pranav Seth, OCBC Bank
211
EXPERT INSIGHTS
This is key, given that businesses need to be based on

how they feed information into their systems and also
how it is reconciled as well as the accuracy of all this.
Getting this right then enables firms to deliver
information to clients in as efficient and fast a way
as possible.
Saying this, the front end does need to develop in
parallel given the role it plays in the customer
engagement and experience.
Although Asia is lagging the US and Europe in many areas, those institutions
which can catch up fastest will be the firms which can reap the biggest
rewards, at least in the short term.
WHICH OF THE BELOW DO INSTITUTIONS MOST NEED TO CHANGE

TO ADAPT & THRIVE AGAINST DIGITAL DISRUPTORS AND
COMPETITORS?
24%
Culture & mind-set of staff
Leadership
Taking a strategic not silod
approach to systems
33%
24%
Willingness to collaborate
with fintechs
Value proposion
10%
9%
ROBO-ADVISORY HERE TO STAY

One of the principal premises of robo-advisory,
meanwhile, has always been to change the way of
thinking about investing towards being more goals
based. This resonates with many investors.
Coupled with the greater transparency created, in terms
of options, track record, and lower costs and fees, and
robo-advisory becomes ever-more compelling for clients.
Jeroen Buwalda, EY and Mark Nelligan, Pershing Securities
212
EXPERT INSIGHTS
Institutions will also increasingly see the advantages of

going down this route, to ensure their end-customers
remain satisfied and can be self-directed.
However, despite there being no doubt that this is the
right place at the right time, as this new way of investing
gathers momentum, the market will need to wait and see
which solutions prevail.
TRANSFORMATION
In terms of the transformation process underway within
Neal Cross, DBS Bank
private banks, it is important that the senior management at these institutions

have a clear vision.
WHAT WILL MAKE THE DIFFERENCE BETWEEN THOSE FINTECHS

WHICH SURVIVE, AND THOSE WHICH WILL DIE OUT?
81%
Commercial viability /
demand including
profitability
Quality of management
Commercial relaonship
of the fintech
Strength of technology
6%
6%
7%
Business leaders must drive the change, by picking the

right people and choosing the right methodology to
execute the plan which often requires a bank to
be agile.
Although some of the changes to come might not be as
drastic as what is happening in the fintech space, the
focus must still be on client engagement and delivering
solutions to improve the client experience.
213
EXPERT INSIGHTS
What if an Uber wealth

was born?
Financial institutions face a strategic choice: either be disintermediated or become part
of the new reality. Raj Ganesarajah of Intellect Design Arena explains why and how the
latter is the only route to survival.
The rise of Uber, which is estimated to
whether they want to be displaced or
have taken about 50% of the share of
become part of the evolution, as the
taxi usage, has convinced a lot of people
wealth management industry strives
that digital will if it hasnt already
for greater efficiency.
change the world.

THE UBER OF WEALTH
These proponents include Raj Gane-
MANAGEMENT
sarajah, the Malaysia country head
According to Ganesarajah, relationship
and senior vice president at Intellect
managers (RMs) and IFAs would react
Design Arena.
in the same way to an equivalent to

Uber in this industry.
An example in the context of the financial space, he says, is the birth of online
This is because it can help them find
peer-to-peer lending companies.
an easier and more efficient way to

serve clients.
The digital trend is only likely to gather

momentum in the industry, believes
His firms digital platform, he explains,
Ganesarajah.
enables investors to manage their port-
RAJ GANESARAJAH
folios in a self-service style.

For instance, he says the emerging affluent like to use digital devices, indicat-
This ranges from creating and refin-
ing that they are looking for a service
ing their own portfolios, to tracking
that matches such a lifestyle.
and analysing the performance, and
Yet while this Uber-style approach to
even includes back-testing various
wealth management gives investors
In turn, financial institutions must now
model portfolios to develop their own
more control, they can still call on advis-
think much more carefully about
model portfolios.
ers for help.
214
Digital Wealth - Asia 2016

10 November, 2016
Island Shangri-La, Hong Kong
REGISTER NOW
At the Registration desk
World-class speakers
300+ Delegates
www.hubbis.com/mainEvent/
Thought-leadership
Networking
Hubbis digital learning solution

We help practitioners at Private Banks, Retail Banks, Insurance Companies, IFAs,
Multi-Family Offices and Independent Asset Managers meet their professional education
obligations via various digital learning content, event presentations, videos and more.
100+ assessed courses

Digital learning modules
Hubbis offers 100+ proprietary training courses covering
core topics relevant to compliance obligations, investment
and product knowledge, advising families on long-term wealth
structuring, and generally building and improving effective
& appropriate advisory skills in an Asian industry context.
Analyse results
Reporting
The Hubbis system allows the recording and reporting of all
online and offline internal and third-party training in order to
provide a complete training record for each individual. The
Hubbis digital learning platform also offers a dedicated reporting feature enabling HR and / or compliance managers to generate customised data sets to match both internal and regulatory training reporting requirements.
200+ hours of live content

Presentations, video Q&As
Hubbis augments formal digital courses with over 200 hours
of live-learning content that ranges from videos to engaging
presentations from Hubbis highly-acclaimed Wealth Management events. Each training course and many of the additional materials are in modules of 30 and 60 minutes for
CPT/CPD/OPT. And all Hubbis modules are assessed prior
to completion to assist in demonstrating users learning
success for regulatory reporting.
Hubbis events
Access to our Forums
Attendance at any of the Hubbis events throughout the
Why we are different

ASIA-SPECIFIC CONTENT - Hubbis is the only
provider of online learning that is solely dedicated to
the Asian wealth management industry
VALUE FOR MONEY - We want to ensure learning is
affordable and accessible to everyone in the wealth
management industry. We never charge any fees for
on-boarding or end-user training
GOVERNANCE - We constantly review & upgrade
the relevance and timeliness of the platform this
includes adding new courses every week, adapting
functionality to the needs of different markets and
types of institutions, and improving the technology.
We also regularly bring together - via our events
and private thought-leadership discussions - market
experts on all topics. This enables us to check our
existing content and plan new courses
COLLABORATION - We collaborate with more
than 100 existing partners on the learning platform
getting feedback and incorporating new ideas for
content, functionality and technology. Plus, we work,
across the overall Hubbis business, with more than
375 partners continually discussing with them their
problems to understand the reality of the market
EDUCATION - The material we produce is USEFUL
and USEABLE. It helps wealth managers and other
practitioners meet their continuing professional
development needs in a practical and robust way
CONTENT DEVELOPMENT - We source content and
insights from the most respected and experienced
practitioners at the leading firms in the market and
package it for our learning platform
year at no additional cost - including forums in 10 markets

across Asia, plus in Switzerland and Dubai.
REPORTING We enable users to generate

individual, team and annual training records on
demand. We offer built-in, customised reporting tools
to quickly meet regulatory requirements
Our learning platform

HR & compliance
The user
Administrators
Live learning
LEARNING PLAN
Tracking
Online
Simple access through an internet
portal that is available 24 hours a day,
Online courses
We give HR & compliance managers

the ability to build learning plans, and
365 days a year. You will have access
apply those plans to defined groups,
to 100+ engaging e-learning courses
and track and record each individuals
that enable users to conveniently earn
learning progress.
CPT / CPD / OPT points.

Tracking
Reporting
Records
Not all e-learners are at the same stage
The e-learning reporting function
in their professional development or

training lifecycle. The integrated
Reporting
also allows all offline and 3rd-party

training to be uploaded to give a single,
reporting system allows HR &
consolidated history for each user. It
compliance managers to monitor
also enables organisations to report
employee progress - highlighting areas
this training to the regulator in a fast,
of weakness / strength.
accurate and consistent format.
Consolidated record
Meeting your critical

compliance requirements
Contact us: learning@hubbis.com
DIRECTORY
People and firms who supported

this publication
We very much appreciate the participation and contribution of key individuals and
organisations in the asset and wealth management communities to the content in
this publication.
PEOPLE QUOTED
Adriel Loh, Bank of Singapore
Jonathan Hubbard, UBS Wealth Management
Alan Luk, Hang Seng Bank
Joseph Tam, Wing Lung Bank
Albert Chiu, EFG Bank
Juan Aronna, RBC Wealth Management
Alison Brown, HSBC Global Asset Management
June Wong, State Street Global Advisors
Alvin Lee, Maybank
Karan Bhagat, IIFL Private Wealth Management
Alvin Ma, EFG Bank
Kevin Lee, Zhong Lun Law Firm
Amanda Chen, Nomura
Kevin Talbot, Aviva Investors
Andri Manatschal, PwC
Kris Chantanotoke, Thai Life Insurance
Angelo Venardos, Heritage Trust Group
Lavanya Chari, Deutsche Bank Wealth Management
Anshu Kapoor, Edelweiss Global Wealth Management
Lonnie Howell, UCAP Asset Management
Anthonia Hui, AL Wealth Partners
Malik Sarwar, HSBC
Arnaud Tellier, BNP Paribas Wealth Management
Marc Lansonneur, DBS Bank
Bassam Salem, Citi Private Bank
Marc Van de Walle, Bank of Singapore
Benjarong Techamuanvivit, Kasikorn Asset Management
Martin Crawford, Vistra Group
Bernard Renell, HSBC Private Bank
Michael Blake, UBP
Brian Shegar, Emirates NBD
Michael Levin, Credit Suisse
Catherine Kirchmann, Investec Wealth & Investment
Mignonne Cheng, BNP Paribas Wealth Management
Damien Mooney, BlackRock
Nanjo Berba, Philam Asset Management
Danial Mah Abdullah, Labuan IBFC
Neil Harvey, Credit Suisse
Don Charnsupharindr, Citi
Nick Pollard, CFA Institute
Eleanor Wan, BEA Union Investment
Nigel Preston, St. Jamess Place Wealth Management
Evrard Bordier, Bordier & Cie
Nigel Rivers, Capital Solutions
Febby Avianto, Falcon Private Bank
Paul Gambles, MBMG Group
Fredrik Lager, SEB Private Banking
Paul Hodes, Citi
Georg Schubiger, Bank Vontobel
Paul Stefansson, UBS Wealth Management
Grace Chow, Bank of East Asia
Peter McMillan, Thomson Reuters
Hans Diederen, Heritage Trust Group
Philippe Legrand, London and Capital Asia
Harmen Overdijk, Caidao Wealth
Piers Brunner, Knight Frank
James Tan, Tokio Marine Life Insurance Singapore
Rainbow Pan, Bupa Global
Jason Dehni, Sun Life Hong Kong
Raj Ganesarajah, Intellect Design Arena
Jason Lai, Thirdrock Group
Ralph Mogicato, Angel investor and entrepreneur
Jing Zhang Brogle, Edmond de Rothschild
Robert B Ramos, Union Bank of the Philippines
Jirawat Supornpaibul, Kasikornbank
Robert Foo, MyFP Services
Joachim Straehle, EFG International
Roger Bacon, Citi Private Bank
John Cappetta, Bank Julius Baer
Roger Steel, Sun Life Financial
218
Ron Lee, Goldman Sachs
Generali
Sandeep Sharma, HSBC Private Bank
Henley & Partners
Sanjay Iyer, Iyer Practice Advisers
Heritage Trust
Seamus Donoghue, Allocated Bullion Solutions
HP Wealth Management
Shanker Iyer, Iyer Practice Advisers
HSBC Private Bank
Shikha Gaur, Aon Hewitt
IMTF Group
Stephanie Jarrett, Baker & McKenzie
IRESS
Stewart Aldcroft, Citi
Sunil Iyer, Iyer Practice Advisers
J O Hambro Capital Management
Thomas Young, Generali
JPMorgan
U Chen Hock, RHB Bank
London & Capital Asia
Vincent Chui, Morgan Stanley
Nordea Bank
Numerix
Orbium
ADVERTISERS
Pershing
AAM Advisory
Appway
Rosemont
Asiaciti Trust
St. Jamess Place Wealth Management
Avaloq
Sun Life
Aviva Investors
Swaen Capital
Bain & Company
Swiss Asia
Bank of China (HK)
Swiss Life
Bank of East Asia
Synpulse
Temenos
BlackRock
ThirdRock
Thomson Reuters
Bordier & Cie
Tokio Marine
British and Malayan Trustees Limited
TTG
Bupa Global
UBP
BVI House Asia
Vermilion Software
Caidao Wealth
Vistra
Capital Solutions
VP Bank
CFA Institute
Willis Towers Watson
Citi Private Bank

Credit Suisse
DBS Bank
EFA Group
Enhanced Investment Products
EY
EFG Bank
Falcon Private Bank
Finaport
First Names Group
Fullerton Fund Management
219
Residence programmes offer

solutions to security risks
Dr. Juerg Steffen of Henley & Partners explains the value and merits of residency
programmes, especially in Singapore and Malaysia.
The quickening pace of globalisation
sponding country-to-country agree-
has given rise to a growing demand for
ments to be executed.
greater transparency among financial

institutions and tax authorities.
It is a big step towards a globally-coordinated approach to disclosure of
In response to this, the Organization
income earned by wealthy individuals
for Economic Co-operation and De-
and organisations.
velopment (OECD), with the support

and endorsement of various countries
There is potentially however, some risk
and international bodies including the
involved to the security of these indi-
G8, G20 and Central Bank Governors,
viduals and their families once govern-
has called for the global implementa-
ments begin exchanging sensitive fi-
tion of its Standard for Automatic
nancial information.
Exchange of Financial Account Information (The Standard).
For wealthy families who have concerns

regarding their privacy, one option is to
The Standard, which was developed as
consider moving to another country
a proactive measure against tax evasion,
where the overall situation is more fa-
outlines how financial account informa-
vorable with regard to security, tax,
tion of foreign tax residents may be
lifestyle and education.
DR. JUERG STEFFEN

Henley & Partners
disclosed by financial institutions and

governments to relevant authorities in
Henley & Partners, the global leader in
order to locate untaxed wealth.
residence and citizenship planning,
children with future options of living,
offers several residence options that
working and studying in several coun-
This would require domestic legisla-
are tailor-made to the needs of affluent
tries, can help them achieve interna-
tion to be implemented and corre-
families, and through providing their
tional success.
220
Key residence programmes of real inter-
mies, due to its continued industrial
Steffen adds: Most investors who are
est today include Singapore and Malaysia.
growth and political stability over the
searching for alternative permanent
past few decades.
residence are motivated beyond money;
Dr. Juerg Steffen, Group Board Member
instead they are often looking to invest
of Henley & Partners and Managing
It is a highly-open, upper-middle income
in countries from a family, social and
Partner of its Singapore office, says:
economy and the third largest economy
cultural perspective.
in this region.
The Singapore Global Investor Program
Residence-by-investment programmes
(GIP) and Malaysias My Second Home
Successful applicants and their depen-
can deliver the quality of life and secu-
Program (MM2H) both offer significant
dents are granted a 10 year multiple-
rity these individuals seek, concludes
attractions and benefits to those able
entry visa.
Steffen.
to diversify their lives and assets.

He continues: Singapore is considered
one of the worlds best places to live,
and is frequently voted as the top Asian
city to live in, because of its excellent
infrastructure and public services.
It is also one of the wealthiest countries
in the world measured by GDP per
capita. Its GIP allows investors and entrepreneurs to apply for a permanent
residence permit.
The MM2H meanwhile, has accepted
more than 27,000 applicants since its
inception in 2002. Malaysia is one of
South-east Asias most vibrant econo-
221

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2016

In many cases, this involves redesigning

larly tough for all industry players. The

the core service model and digitising

various challenges that organisations

parts of the value chain.

face are nothing new, but the pressures

A lot of conversations at the moment

chief executives are reconsidering their

among industry leaders revolve around

business models, along with the strate-

efficiency and enabling front-line staff

gic choices they need to make, to remain

to be more productive to generate

revenue opportunities rather than

In short, this means re-focusing on the

areas within which they believe they

Meanwhile, the desire to develop more

needs-based solutions for clients in Asia

For some players, this has meant exiting

will finally drive the change in thinking

certain markets or locations, or the in-

needed to lead to a new business model

for wealth management in Asia.

For those with the conviction to con-

The content in this publication covers

tinue to compete in this space, they need

these issues and more. I hope you enjoy

to determine how to build a sustainable

reading and are able to benefit from

platform for the future.

A NEW LOOK-AND-FEEL FOR ASIAN WEALTH MANAGEMENT

In a more challenging year for wealth management and private banking

WILL PRIVATE BANKING IN ASIA THRIVE OR WITHER?

As consolidation gathers pace and polarisiation within this segment

WEALTH MANAGEMENT IN ASIA 2016

RE-IGNITING THE REVENUE ENGINE

Wealth managers have found it tougher than ever to make money

CHANGING THE RULES OF THE ADVISORY GAME

A PRESSING NEED TO ENHANCE THE DISTRIBUTION MODEL

Having discussions which are more focused, relevant to clients needs

THE EMERGENCE OF ASIAN MULTI-FAMILY OFFICES

Philippe Legrand of London and Capital Asia

PROVING THE VALUE OF PROFESSIONALISM

Nick Pollard of CFA Institute

WHY PRIVATE BANKS WILL LIVE OR DIE ON INNOVATION

Mignonne Cheng of BNP Paribas Wealth Management

MAYBANK KEEPS FOCUS ON SUSTAINABILITY IN PRIVATE WEALTH

Alvin Lee of Maybank

Brian Shegar of Emirates NBD

HOW BEA IS EYEING CHINA FOR WEALTH MANAGEMENT GROWTH

Grace Chow of Bank of East Asia

WEALTH MANAGEMENT IN ASIA 2016

THE COMPONENTS OF A SUCCESSFUL WEALTH OFFERING IN INDIA

Karan Bhagat of IIFL Private Wealth Management

KASIKORNBANK SHOWS WAY TO SERVICE HNW THAIS

Jirawat Supornpaibul of Kasikornbank

BRINGING A BROADER AND DEEPER OFFERING TO THAILAND

Don Charnsupharindr of Citi

THAI INSURERS JUMP ON DIVERSIFICATION BANDWAGON

Kris Chantanotoke of Thai Life Insurance

CHANGING THE PHILIPPINES INVESTMENT MIND-SET

Robert B Ramos of Union Bank of the Philippines

CATERING TO A MORE GLOBAL OUTLOOK IN THE PHILIPPINES