Issue 107 Awards Edition January 2017 Full by Asian Private Banker

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LETTER FROM THE EDITOR

f 2016 is a year best forgotten, then we should take heart from the fact that adversity is the single most potent stimulator of progress, improvement and innovation.

Indeed, a perfect storm of market uncertainty and client inactivity, regulatory tightening and political upheaval did its best to curtail the customary ebullience of an industry that plies its trade at the global epicentre of wealth creation. The individuals and institutions celebrated in this edition are clear proof that Asiaâ&#x20AC;&#x2122;s private banking industry, for the most part, does not harbour a slavish obsession with the bottom line, but rather possesses a nuanced understanding that, by prioritising clientsâ&#x20AC;&#x2122; best interests, business performance and sustainability will follow. This is the sixth year Asian Private Banker has set itself the task of identifying best-in-breed institutions across a diverse range of categories. Practice, as they say, makes perfect. Even so, the framework that we employ to judge these awards will continue to evolve in line with the evolution of private banking. What will never change is the independence and attention to detail that underpin our adjudication process and, of course, our entire editorial product. I therefore thank the industry for pitching with earnestness and transparency to ensure that the Awards for Distinction remain the benchmark for private banking excellence in Asia.

Sebastian Enberg Editor Asian Private Banker

ASIAN PRIVATE BANKER

CONTENTS ISSUE 107

Awards for Distinction 2016

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CEO Andrew Shale Editor Sebastian Enberg Editorial Richard Otsuki Priyanka Boghani Charlene Cong Managing Director Paris Shepherd Business Development Madhuri Chatterjee Sonia Lam Sam Chan Joanne Tse Stacey Wong Kale Law Olaide Ogungbesan Eldar Gainutdinov

Digital Tristan Watkins Yiyang Zhou CĂŠcile de Buor Wilfred Lam Koye Sun Jacqueline Lau Gloria Fan Alice Wong Finance & Operations Karman Wu Benjamin Yang Jessie Cheng Dennis Luk Production DG3

Published by Key Positioning Limited 13B Greatmany Centre 111 Queenâ&#x20AC;&#x2122;s Road East Wanchai, Hong Kong Tel: +852 2529 1777 Fax: +852 3013 9984 Email: info@asianprivatebanker.com ISSN NO. 2076-5320 4 asian private banker

Letter from the Editor

About the Asian Private Banker Awards for Distinction 2016

The most important stories that we broke in 2016

Private Banker of the Year Albert Chiu

A year of Straight Talk

Best Private Bank - Asia Credit Suisse

16 Best Private Bank - Hong Kong HSBC 17

Best Private Bank - Singapore Bank of Singapore

Best Private Bank - Pure Play Julius Baer

Employer of the Year Goldman Sachs

21 Best Private Bank - Australia Westpac 22

Best Private Bank - China International Goldman Sachs

Best Private Bank - China Domestic China Merchants Bank

Best Wealth Manager - China Domestic Noah Private Wealth Management

Best Private Bank - India Domestic Standard Chartered

Best Wealth Manager - India Domestic IIFL Wealth & Asset Management

45 Best Private Bank - Wealth Planning Services HSBC

Best Private Bank - NRI Services BNP Paribas

Best Private Bank - Fund Advisory Services Credit Suisse

Best Private Bank - Indonesia International Credit Suisse

Best Private Bank - Alternative Investments Goldman Sachs

Best Private Bank - Indonesia Domestic Bank Mandiri

49 Best Private Bank - Philanthropic Services HSBC

Best Private Bank - Malaysia International Credit Suisse

33 Best Private Bank - Malaysia Domestic Maybank 34

Best Private Bank - Philippines International Bank of Singapore

Private banksâ&#x20AC;&#x2122; AML budgets unchanged despite Panama Papers, 1MDB shocks

37 Best Private Bank - Philippines Domestic BDO 38 Best Private Bank - Taiwan International UBS 39 Best Private Bank - Taiwan Domestic UBS 40

Best Private Bank - Thailand International Credit Suisse

Best Private Bank - Thailand Domestic Siam Commercial Bank

42 Eight exclusive data points that mattered in 2016

Best Private Bank - External Asset Managersâ&#x20AC;&#x2122; Choice Credit Suisse

51 Best Private Bank - Discretionary Portfolio Services UBS 52

Best Private Bank - UHNW Services J.P. Morgan

Best Private Bank - Digital Experience Credit Suisse

Best Private Bank - Next-Gen Programme Credit Suisse

55 Best Private Bank - Tech Disruption UBS 56

New data points to client onboarding pains at private banks

57 Best Private Bank - Family Office Services UBS 58 Best Private Bank - Training and Development Programme UBS

asian private banker 5

ABOUT THE ASIAN PRIVATE BANKER AWARDS FOR DISTINCTION 2016

Since 2011, the Asian Private Banker Awards for Distinction have set the standard for excellence in private banking in Asia Pacific. The Awards, which are open to private banks and institutions with private banking facilities in the region, stand apart due to the independence, objectivity, and rigour of the judging process. CAT E G OR I E S Institutions are invited to make submissions on a category-specific basis and only those institutions that do so will be considered for an award. The Private Banker of the Year and Best Private Bank - External Asset Managers’ Choice awards are exceptions to this rule, being respectively determined by the Judging Panel and feedback gathered from external/independent asset managers and multi-family offices in Asia. A total of 36 categories were awarded for 2016. M E T H ODO LO GY Winners are selected by the Judging Panel on the basis of any and all information submitted. The Judging Panel assesses submissions using weighted quantitative and qualitative metrics, with great emphasis on the former, as defined by the Submission Guidelines (visit apb.news/afd2016 for details). The Judging Panel recognises and understands the nuances of running a profitable and sustainable private banking business and therefore retains some flexibility regarding weightings. JUD G IN G PA N E L The Judging Panel is made up of Asian Private Banker’s editorial team. Combined, this is the industry’s most experienced and connected bureau of journalists covering private banking in the Asia Pacific region.

Sebastian Enberg editor

ASIAN PRIVATE BANKER

Richard Otsuki senior reporter

Priyanka Boghani senior reporter

Charlene Cong reporter

EDITORIAL

The most important stories that we broke in 2016 2016 was an eventful year in private banking. But not all stories are created equal and many of the year’s most important news was broken here at Asian Private Banker. We round up just a few of our exclusives in 2016.

Crédit Agricole PB rebranded as Indosuez WM

AUM growth stalls for first time since 2012

We kicked off the year by revealing that Crédit Agricole, the French lender, was reorganising and rebranding its private banking division under the name ‘Indosuez Wealth Management’. CredAg’s wealth management head for Switzerland, the Middle East and Asia, Patrick Ramsey confirmed the change in an exclusive interview with Asian Private Banker and said that it was “part of a wider process of aligning subsidiaries in different geographies to offer a streamlined and cross-border service to families and entrepreneurs across the globe.” Indosuez WM also revealed that it had about €10 billion of global AUM in Asia and 62 relationship managers in Hong Kong and Singapore.

Assets under management (AUM) growth at Asia’s top 20 private banks stalled for the first time in 2012, according to Asian Private Banker’s 2015 AUM League Table, released in April. Perhaps indicative of the tough times ahead, the total value of client assets contracted by 4.3% to US$1.47 trillion for the full year ending December 31, 2015. Half of the League Table recorded negative or flat YoY growth, while only two private banks experienced growth in excess of 10% in 2015. Private banks were better off in 2014, with 19 out of the top 20 recording an increase.

Project “LAND” grounded

The Canadian lender decided to consolidate its Hong Kong and Singapore core operating platforms into a single platform. Previously, RBC Wealth Management used separate platforms, due in large part to the bank’s brokerage-led model in Hong Kong and its private banking model in Singapore. Asian Private Banker revealed that the move was designed to boost efficiency and cut operating costs. It also led to “operational headcount cuts,” an industry insider said. News of RBC WM’s restructuring and platform consolidating in Asia was in line with a wider restructuring trend amidst cost pressures. Swiss major UBS Wealth Management announced that it would merge its back

2016 got off to an inauspicious start on the tech front. Asian Private Banker first reported the disintegration of LAND, an automated structured products distribution consortium comprising of Leonteq, Avaloq, Numerix and DBS Bank. LAND was formed in March 2015 and was earmarked to go live in 2016 however the partnership fell apart after news broke that DBS Private Bank – the only party on the consortium’s buy-side – pulled the plug. Two weeks later, Leonteq revealed the official reason for the consortium’s demise: “diverging interests on some business models and exclusivity discussions.”

RBC WM consolidates HK & SG platforms, headcount cuts

and middle office functions and streamline its internal IT operations.

Chinese bank takes stake in HK MFO Panelists at Asian Private Banker’s IAM and Family Office Leaders Conversation in November agreed that they would resist M&A opportunities that involve large financial institutions – especially banks. And yet, three months earlier, we broke the news that China Minsheng Banking Corporation had taken a stake in Hong Kong-based MFO, Carret Private, through its wholly-owned subsidiary, CMBC International Holdings. The impetus behind the deal was to “develop a mutually beneficial core product offering for Chinese UHNWIs,” Carret Private said in a subsequent media release. Cofounded by Julius Baer’s former Asia head of investment solutions group, Kenny Ho, Carret Private Investments – an affiliate of US-based Carret Asset Management – launched in Asia in 2015 and, in early 2016, onboarded a handful of senior private bankers with client books of US$500 million to US$1 billion. Then in July, Carret Private merged with QL Asset Management Company. Carret Private counts among its staff Victor Choi, former head of markets and investment solutions in Asia for Crédit Agricole Private Banking, and Coutts’ ex-head of North Asia, David Lam. Continued on page 9.

ASIAN PRIVATE BANKER

INDUSTRY

BOCHK in regional expansion drive

Deutsche WM: changes in leadership

In August, Asian Private Banker revealed that Bank of China (Hong Kong) was undergoing a wholesale transformation in a bid to become a fully-fledged regional player. BOCHK told Asian Private Banker in an exclusive statement that its private banking business will be a key strategic focus for the group and that it will establish a regional platform targeting mid-to-high-end clients. Accordingly, BOCHK has been actively acquiring Bank of China’s (BOC) branch and sub-branch network in six ASEAN countries — Singapore, Thailand, Malaysia, Cambodia, Vietnam and the Philippines — using funds from the HK$68 billion sale of subsidiary Nan Yang Commercial Bank to China Cinda Asset Management.

A flurry of changes to Deutsche Bank Wealth Management’s leadership in Asia took the industry by surprise, even as the bank was coming under immense pressures at the global level. Ravi Raju, the private bank’s Asia Pacific head left for Swiss major, UBS Wealth Management, was quickly followed by Anurag Mahesh, Deutsche Bank WM’s global head of key client partners. Raju had been with Deutsche Bank in Asia since 2007 and was known for his fierce loyalty to senior management, relationship managers and clients. Meanwhile, Deutsche Bank WM quickly named Lok Yim as its new APAC head. Raju was the third regional head of wealth management to leave under Fabrizio Campelli, Deutsche Bank’s global head of wealth management. The wealth management franchise had already lost its head of America (Chip Packard in March) and the Middle East (Marco Bizzozero). Campelli told Asian Private Banker that the bank has a “robust succession plan”.

CSAM fixed maturity bond APB Mandate, Asian Private Banker’s sister website which focuses solely on investment-related content, broke the news of 2016’s most successful mutual fund raise that took Asia’s wealth management industry by storm. Credit Suisse made industry headlines by raising US$2 billion from private banking clients through its asset management arm’s fixed maturity bond fund. The fixed maturity bond fund floodgate subsequently opened and both wealth and asset managers attempted to mirror CSAM’s success. Julius Baer was the latest private bank to do so, raising US$600 million from an AllianceBernstein fixed maturity bond fund – another APB Mandate exclusive.

We called it: LGT as one of the top two bidders to take ABN AMRO’s private bank in Asia [November] Asian Private Banker led the way in reporting the sale of ABN AMRO’s private bank in Asia, having tipped LGT to take the honours in what proved to be a closely guarded bidding process. LGT did indeed acquire ABN AMRO’s private banking business in Asia and the Middle East. The deal is pegged to push LGT’s assets under management (AUM) in Asia to US$40 billion. In the leadup, Asian Private Banker reported on a number of changes at ABN AMRO Private Banking in Asia, including significant staff cuts. Amidst the noise, ABN AMRO named an industry veteran and former Pictet Southeast Asia CEO, Anuj Khanna as its new head of private banking business for the Southeast Asia region.

ASIAN PRIVATE BANKER

P R I VAT E B A N K E R O F T H E Y E A R

ALBERT CHIU

A L B ERT C HI U

he quest to identify one outstanding private banker amongst a pool of supremely talented practitioners invariably throws up a number of sinewy questions: does one prioritise business acumen and performance, leadership qualities, strategic foresight or legacy? Ultimately, there can be no definitive answer; and because Asia is home to a miscellany of institutions, business models and value propositions, private bankers rarely conform to a single ‘ideal’. But peel back the layers of any private bank in Asia and one will often find an individual who consistently sets themselves apart. 2016, as most would readily agree, was no ordinary year for the industry, but rather a moment of sustained uncertainty, replete with shock political events and regulatory tightening. Such conditions provide fertile ground for individuals to distinguish themselves from the rest. It is against this challenging backdrop that we have sought to identify a private banker who has demonstrated leadership, business smarts and fortitude under intense pressure. Arguably, few practitioners faced a more pressing set of challenges in 2016 than Albert Chiu, EFG Bank’s chief executive for Asia Pacific and an EFG banker since 2000. Indeed, Chiu, who has had an instrumental hand in building out EFG’s lean and entrepreneurial franchise in Asia, spent 2016 contending with an integration that would cause a less-mettled private banker to wilt. The BSI deal is, of course, global in scope, but the Asia region assumed particular import due to BSI’s well-publicised regulatory transgressions that cost the bank its licence in Singapore and that will continue to reverberate throughout the industry in 2017.

While not the only acquisition to take place last year, the EFG-BSI deal threw up a singular set of challenges that had Chiu shuffling between Hong Kong, Singapore and Switzerland, actively engaging with clients, employees and regulators to ensure a smooth and, ultimately, optimal solution for all stakeholders; and by November, the Singapore integration - facilitated by an accelerated asset deal - was complete. Such was the “success” of the integration process in Singapore that EFG is using it as the “blueprint for other international locations”. Market conditions did little to moderate Chiu’s task list in 2016. An industry-wide slump in transactional business hit private banks throughout the region, with some players recording as much as a 40% drop in volumes, according to APB Mandate data. EFG in Asia was not insulated from this dynamic, but by the year’s end, Chiu had guided the bank to within par levels, all the while executing a number of key hires, including a high-profile market manager and a DPM head. Chiu’s resume, which includes a seven-year stint as treasury manager for HSBC Bank USA Hong Kong Branch before joining EFG, does not read like the archetypal private banker. But it is perhaps for this reason that he has successfully carved out such a nodal role at an institution that epitomises the ambition and tenacity of entrepreneurial Asia more than most other private banks. To be sure, EFG has garnered its fair share of admirers and detractors in the industry, but few would deny the leadership and mettle Chiu demonstrated throughout 2016 as well as the vital role Chiu has played at bringing EFG to where it is today in Asia. Albert Chiu is Asian Private Banker’s Private Banker of the Year for 2016.

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EDITORIAL

A year of Straight Talk Michael Blake CEO, private banking Asia Union Bancaire Privée [T]he primary objective at the moment is to double the size of the [Asia] business off the back of the Coutts acquisition. So the immediate priority now is to consolidate and double in size. Whether that takes us two, three or four years depends to a certain extent on the steps we take and also the market environment.

Fabrizio Campelli global head of wealth management Deutsche Bank The beauty of this business [wealth management] is that it generates unbeaten revenues on risk weighted assets. Indeed, across all the bank’s businesses, wealth management provides the best return on risk-adjusted capital. Not only is it capital efficient, it also generates fee income in a low interest rate environment, both of which are very strategic to Deutsche Bank right now. So there is a very good reason to stay [in wealth management]. As far as wealth management in Asia is concerned, my brief is to grow it, not ring fence it to prepare it for an exit.

Mignonne Cheng chairman and CEO BNP Paribas Wealth Management, APAC I’m not downplaying Hong Kong and Singapore; but I am saying that we need to consider seriously how we should tap into onshore markets. What I can say is that those domestic onshore markets – whether Taiwan, Indonesia or China – will be the new focus. There is going to be a transformation.

ASIAN PRIVATE BANKER

Albert Chiu chief executive, Asia Pacific EFG Bank Moving forward, I believe that pure plays continue to have a better chance than universal banks at growing assets, as we have a stronger value proposition relating to our independence.

Boris Collardi CEO Julius Baer That one [M&A] opportunity for us, I’m convinced, will exist again. I don’t think Merrill was a once in a lifetime deal. It was a good deal – we got a lot of criticism for the transaction initially – but there could and will be something else. I just don’t know when. The important thing for us is not to do the wrong transaction because this occupies capacity. It can destroy our reputation because you’re only as good as the last deal you’ve done.

Francesco de Ferrari head of private banking, Asia Pacific and CEO Southeast Asia, Credit Suisse How we play China onshore will be the key to the next stage. We are tackling this question from a One Bank (investment banking and wealth management) perspective. If I look at our competition, we also have a lot of room to grow in Hong Kong and, like any domestic business, that actually is a very safe bet for us to make.

Wang Jing general manager China Merchants Bank Private Banking Many people assume that foreign banks, given their maturity and experience, are a natural source of competition for onshore majors in China. However, their growth has been unexpectedly slow due to licensing and product-related issues. Some foreign private banks have even laid off staff in the Mainland, or have merged with retail banks. It seems to me that they do not have a consolidated foundation to grow in a profitable manner.

Edmund Koh head of wealth management, Asia Pacific UBS We believe you cannot put a price on innovation or cultural transformation. Our approach has been to invest wisely and we believe our approach is the best combination of making sure we get the most out of our learnings while making sure that we don’t spend too much.

Alan Luk head of private banking & trust services Hang Seng Bank Most of our core clients are Hong Kong Chinese, of course, but with China’s wealth pool growing exponentially, we are now onboarding more and more Mainland Chinese. Right now, about 50% of our new clients are Mainlanders.

Vincent Magnenat head of private banking Asia Lombard Odier We believe onshore will grow. That doesn’t mean that offshore will decrease, but I expect less assets will go [offshore] as soon as the capabilities of the local banks serve clients in the same way as they may be served offshore. So when it comes to the choice of [onshore] partners, we meet a lot of candidates, and based on the understanding, vision and values of the banks, we make a decision.

Bahren Shaari chief executive officer Bank of Singapore I am a hands-on manager and I expect all managers to be like that. I conduct spot checks occasionally where I ask bankers to show me their best and worst accounts. Through such sampling, I know how a banker is doing.

Andrew Tjia head of private banking, Asia VP Bank [G]lobally we have CHF33 billion in AUM. By 2020, we hope to hit the CHF50 billion mark with 50% of the revenue generated from Asia… At the moment, VP Bank has 12 RMs in Singapore and eight in Hong Kong. We have onboarded very experienced bankers with sizeable book sizes of US$200 million or more. Globally, we plan to hire 25 RMs every year over the next three years.

ASIAN PRIVATE BANKER

Credit Suisse. Delighted to receive 8 Asian Private Banker awards. We capped 2016 by winning an unprecedented number of trophies at the Asian Private Banker Awards. We thank our clients and employees for this great achievement. Since 1969, we’ve been helping entrepreneurs in Asia Pacific thrive. We do this by connecting our clients to a dedicated team that harnesses our combined investment banking, asset management and private banking expertise. This allows us to constantly identify new ways for our clients to grow and succeed. To find out how our award-winning services can help you, visit credit-suisse.com Best Private Bank – Asia Best Private Bank – Thailand International Best Private Bank – Fund Advisory Services Best Private Bank – Indonesia International Best Private Bank – Malaysia International Best Private Bank – External Asset Managers’ Choice Best Private Bank – Digital Experience Best Private Bank – Next-Gen Programme

CR E DI T SUI SSE

hough the conversation may have skewed towards Asia’s impending intergenerational wealth transfer and the growing need for preservation and planning services, a dominant pool of Asian UHNWIs remain in the wealth accumulation phase, with ambitions to develop global businesses and world class products. This fact has not been lost on Asia’s private banking industry, and universal banks are using their scale and diverse capabilities to deliver ‘one bank’ solutions to clients. In 2016, Credit Suisse demonstrated that it is the ‘one bank’ leader to be reckoned with.

Francesco de Ferrari head of private banking Asia Pacific and CEO Southeast Asia Credit Suisse

By partnering with its top-tier investment banking arm, Credit Suisse’s private bank successfully delivered bespoke financing solutions and a leading multi-asset trading platform to UHNWIs and family offices throughout Asia. But its success is not solely attributable to the group’s investment banking prowess or the infrastructure it has put in place to enhance synergies within the group. The remainder of Credit Suisse’s private banking business across advisory and discretionary registered strong growth, notching up impressive returns that showcase its due diligence capabilities. And who can forget the private bank’s blockbuster delivery of a fixed maturity bond fund to its broader high net worth client base - a collaborative play with Credit Suisse’s asset management arm that prompted the industry to follow suit. Ultimately, the results speak for themselves: consistent multi-year net new asset growth, revenue growth totaling more than CHF80 billion in the past few years significantly outpacing the industry average in challenging market conditions and deep and focused coverage of the region’s top UHNWIs. “For more than a decade, Credit Suisse has been committed to serving its clients in Asia on an integrated platform with strong private banking and investment banking capabilities,” says Francesco de Ferrari, head of private banking, Asia Pacific and CEO Southeast Asia, highlighting that the successful approach to the business is to treat it as a marathon and not a sprint. “This business model has been further solidified in Asia Pacific since October 2015 when the bank combined private banking and investment banking into one business division in the region, with integrated coverage and platform delivery that supports entrepreneur clients’ corporate and private wealth growth. With our vision of being the ‘Entrepreneurs’ Bank in Asia’, we are convinced this is the most relevant and powerful business model for Asian clients for where they are at in their business and wealth cycles.” Despite a material slump in investor appetite, driven in no small part by market uncertainty, Credit Suisse pushed back against the headwinds, posting positive growth across a balanced and diversified mix of business lines in its private bank. Asian Private Banker is proud to name Credit Suisse Best Private Bank - Asia for 2016.

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HSB C

Chinese slowdown and the aftermath of the recent A-shares fiasco sent ripples through the Hong Kong investing community, dramatically affecting investors’ appetite for trading and the outlook for family businesses. A structural transformation of the Chinese economy and its potential impact on Hong Kong has opened up opportunities for private banks to deliver timely advice, while a regional demographic shift, led by many of Hong Kong’s relatively elder UHNWIs who wish to pass on wealth and businesses to the next generation is increasing the premium placed on wealth planning.

Kevin Herbert co-head, North Asia HSBC Private Bank

One and a half centuries in the city has undoubtedly helped the “Hong Kong Bank” to develop deep multi-generational relationships that have been tested throughout multiple market cycles and wealth stages. But it was HSBC Private Bank’s decision to refine its ‘one bank’ strategy to better realise synergies across business lines and eliminate the silo mentality that plagues so many universals that enabled it to withstand market headwinds and post stellar results across key financial metrics in 2016. HSBC’s pedigree in Hong Kong has allowed the private bank to develop deep and mature business lines, especially in philanthropy and wealth planning. The former, which many banks treat as a marketing cost or a value-added service is, for HSBC Private Bank, a self-sustainable business line and the latter leverages upon established client relationships, delivering truly bespoke solutions that surpass generic trust and estate planning offerings. “The client will always remain at the centre of our approach and we have a dedicated team of global solutions specialists who offer bespoke corporate finance and non-traditional wealth structuring solutions, which as appropriate, connects our clients to HSBC’s investment banking and commercial banking businesses,” says Kevin Herbert, co-head, North Asia, HSBC Private Bank. “Our Private Wealth Solutions business is one of the global leading private trustee and family office services providers, with over 70 years of experience advising generations of family businesses in Hong Kong and Asia. Our expertise, insights and resources ensure our bespoke counsel and wealth solutions align with the families’ shared vision of wealth management and trust structure, as well as retaining control and wealth for the founding families across generations.” HSBC Private Bank is Asian Private Banker’s Best Private Bank - Hong Kong for 2016.

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B A N K OF SI NGAPOR E

t is in moments like these, when client portfolios face excessive turbulence and transactional flows dry up, that the traditional private banking model is at its most compelling. The delegation core portfolio management duties (especially in a still ultra-low rate environment) the avoiding of excessive client-directed risks is a lofty ideal that few banks have managed to meet.

Bahren Shaari chief executive officer Bank of Singapore

However, Bank of Singapore’s pursuit of this ideal has, in turn, insulated clients and bankers from the risks posed by unsound opportunities, undisciplined investing and unchecked zeal. Unwilling to settle for just gathering brokerage revenue from regional HNWIs, Bank of Singapore has cultivated a diverse business that encompasses all facets of wealth management. It has already built a deep pool of discretionary assets - its last publicly disclosed penetration rate of 17% has since grown to over double Asian Private Banker’s estimate of the industry average in Asia. The bank has achieved this impressive rate in a mere eight years, even as pedigreed European players struggle to break double digits. Its focus on fee-based offerings has enabled it to moderate expenses and register a cost/income ratio significantly below industry average. The bank’s investment solutions have been proven to deliver long-term returns across the board. Its equity, fixed income and funds solutions have all posted benchmark-beating performance. Perhaps the most indicative quantitative hint of the bank’s culture of risk management is the track record of its buy, sell or hold recommendations: its marginal sell recommendations have still eked out slight gains, illustrating a healthy skew towards risk aversion. Most impressive is that Bank of Singapore has achieved such stable growth amidst its integration of Barclays’ wealth businesses in Hong Kong and Singapore - a deal that saw it transfer US$13 billion in AUM and more than 60 bankers. Bank of Singapore’s rise owes a lot of its success to the arm’s-length relationship it has with parent group OCBC. Running on a separate balance sheet, profit and loss account and with independent management, Bank of Singapore has circumvented the challenges that many Asian peers face when building out private banking arms, including resource sharing across platform and talent. Bank of Singapore is Asian Private Banker’s Best Private Bank - Singapore for 2016.

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FIRST MOVERS WILL ALWAYS CHANGE THE WORLD. BUT WHICH ONE? >> Discover our approach at juliusbaer.com/visionary-thinking

Julius Baer is the leading Swiss private banking group and present in some 50 locations worldwide. From Dubai, Frankfurt, Geneva, Guernsey, Hong Kong, London, Lugano, Monaco, Montevideo, Moscow, Mumbai, Nassau, Singapore to Zurich (head office).

SINCE 2011 JULIUS BAER HAS BEEN REPEATEDLY HONOURED WITH AWARDS FROM “ASIAN PRIVATE BANKER”.

J U L I US B AER

ulius Baer refers to Asia as its “second home market” - and rightfully so. Since 2007, when the pure play received its first banking licence in the region, Julius Baer has continued to pour resources into a region that is today the epicenter of wealth creation.

A critical juncture in Julius Baer’s story is the widely lauded acquisition of Merrill Lynch’s International Wealth Management business - a deal that catapulted the pure play into the major leagues both in Asia and globally. Indeed, from 2012 to 2015, Julius Baer grew its assets under management (AUM) in Asia at a CAGR of over 20%, according to Asian Private Banker estimates, ranking it among the top five private banks by AUM and the largest pure play in the region.

Jimmy Lee head Asia Pacific Julius Baer

But 2016 will go down as a landmark year for Julius Baer in Asia in its own right. Group CEO, Boris Collardi, has consistently spoken of his desire to pursue an organic growth path, telling Asian Private Banker last October that the current M&A market “does not fulfil [the bank’s] criteria”. Putting plans into action, Julius Baer hired vigorously throughout 2016, adding in excess of 100 private bankers across key markets in Asia. “We had a strong hiring momentum in the past year and it is reassuring to see that in this challenging environment, many seasoned professionals from different banks believe in our unique positioning as a real pure play and a distinguished employer of choice,” says Jimmy Lee, head Asia Pacific, Julius Baer. “While we will continue to hire the right talent, we would also like to focus more on training and developing our own people in 2017. Developing our own talent remains as one of the key priorities.” New hires do not immediately translate into increased profits, but Julius Baer enjoyed strong asset inflows in Asia that well-exceeded the bank’s 2017 target range of 4-6%, helping to push the group’s AUM total to a bank record CHF327 billion at the end of October 2016, with Asia AUM accounting for approximately 20-25%. And Julius Baer rounded out an exciting year by raising over US$600 million for a fixed maturity bond fund - testament to the quality of its Asia-based advisory team. Julius Baer is Asian Private Banker’s Best Private Bank - Pure Play for 2016.

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G O L DM AN SAC HS

iscovering and retaining quality talent is a challenge that confronts each and every private bank in Asia, but few institutions have proven themselves to be as effective as Goldman Sachs.

In 2016, Goldman Sachs demonstrated that it is the industry leader in terms of seeking out and attracting a diverse cast of talent and, in turn, cultivating a work environment that encourages performance, progression and a healthy work-life balance.

Ronald Lee head, private wealth management, Asia Pacific Goldman Sachs

Goldman Sachs’ pedigree as an employer stems in large part from its hiring strategy: the bank goes to extraordinary lengths to uncover and attract talent from a diverse range of backgrounds and cultures. Here, diversity is considered a non-negotiable means to creating value for clients and shareholders and not just box-checking exercise. Of particular note is Goldman Sachs’ campus recruitment strategy. Committed to seeking out best graduate talent, the bank utilises technology to reduce geographical/resource barriers facing students and, ultimately, to cast the net across a wider pool of campuses and individuals who may otherwise be overlooked. Once inside, private wealth management staff receive targeted training across a range of soft and hard topics and are exposed to periodic, institutionalised feedback from senior staff across the bank. The private wealth curriculum includes a stint at the New York headquarters, as well as an Asia-specific programme that runs out of Hong Kong. Furthermore, employees receive best-in-class access to educational, health and lifestyle services - testament to the seriousness with which Goldman Sachs treats the wellbeing of staff, both in and beyond the office. Ultimately, Goldman Sachs’ forward-thinking initiatives and attention to the specific needs of new and seasoned talent alike have contributed to double-digit growth in the private bank’s headcount over the last four years and an extremely low turnover rate in 2016. “Growing wealth in the region presents a compelling business opportunity, but the talent pool is limited as the industry is still in a relatively early stage of development,” says Ronald Lee, head of Goldman Sachs Private Wealth Management in Asia Pacific. “That’s why we put a lot of focus on attracting and cultivating the best talent. People are our most important asset and the cornerstone of our success.” Goldman Sachs Private Wealth Management is Asian Private Banker’s Employer of the Year for 2016.

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W ESTPAC

ustralia’s private banking space has undergone considerable change in recent times, headlined by widespread restructuring, rebranding, outright exits and new entries. Amidst this flux, Westpac Private Bank has remained a consistent achiever, posting double digit revenue growth and earning best-in-class client and employee satisfaction ratings.

Jane Watts general manager BT Private Wealth

2016 was a year when the private bank worked to further align its offering with the needs of its clients - a multi-pronged strategy that has included the introduction of a digital concierge service, broadening client access to global and domestic high net worth investment opportunities and strengthening its ‘direct wealth investment’ capabilities for the growing pool of ‘self-directed’ investors in Australia. “In a dynamic global landscape, we have been able to respond to changing consumer sentiments, providing digital innovations and outstanding service experiences,” said Jane Watts, general manager of BT Private Wealth, a division of the Westpac Banking Corporation. “The recent achievements highlight the strength of our business and the exceptional client management we provide our clients.” Westpac Private Bank has also adopted an efficient investment framework for its operations that has enabled it to maintain a healthy cost/income ratio. On the technology front, the bank has committed to a range of digital initiatives such as client-facing tools that allow transaction and balance views through mobile portals and a dedicated service improvement team to ensure the efficient execution of trades and seamless client onboarding processes. The private bank has also delivered a comprehensive wealth curriculum to upskill its private bankers on both technical know-how and soft skills. Westpac Private Bank is Asian Private Banker’s Best Private Bank - Australia for 2016.

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G O L DM AN SAC HS

he growth and structural transformation of the Chinese economy - from domestic and capital-driven to internationalised and consumption-driven - poses acute challenges for international wealth managers. Old economy participants are either diversifying their businesses, both by sector and geography, or outright exiting, while new economy participants are positioning their businesses so that they can benefit from a surging middle class that, by 2022, will be large enough to be the third-most populous country. Differences aside, few expect the path to the ‘Chinese dream’ to be smooth - a point exemplified by the financial markets, where a weakening yuan and dichotomous monetary policies promise to inject home-skewed Chinese HNWI portfolios that with episodes of high volatility

Nick Yim head North Asia private wealth management Goldman Sachs

Against such a backdrop, the level of care that is required when managing business and non-business assets has increased, and private banks that can earn and retain clients’ trust and manage portfolios through market cycles stand to benefit from fee-based revenue growth. Goldman Sachs has proven itself to be a resilient and progressive player within the largest HNW segment in Asia and, in 2016, the American bank continued to carve intrepid inroads in China, further transitioning brokerage-centric clients into fee-based mandates. Indeed, in a market of reluctant adopters who are often overconfident when it comes to their trading capabilities, Goldman Sachs has established itself as a leading discretionary manager, by asset size and penetration rate, in Asia. And as short-term volatility haunts public markets, its critically acclaimed alternatives platform has played a critical role in helping clients diversify across hedge funds, private equity, global real estate and more. Ultimately, in 2016, Goldman Sachs’ unwavering commitment to extolling the virtues of a portfolio-centric approach to wealth management yielded stellar results in its China business. Remarkably, this has been achieved in the UHNW space, where investors’ multi-banking tendencies increase the pressure on private banks to outperform competitors. “Our China business has continued to grow despite the challenging market environment in the past year. Chinese clients value our advice and global capabilities as they increasingly recognise the need for wealth advisory services,” said Nick Yim, head of the North Asia region at Goldman Sachs Private Wealth Management. “China is an important growth driver for us and we are committed to expanding our business.” Goldman Sachs is Asian Private Banker’s Best Private Bank - China International for 2016.

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C H I N A M ER C HANTS B ANK

f there is one market globally that stimulates both excitement and trepidation among private banks, it’s China. Most private banks operating in Asia will readily agree that China is the toughest nut to crack, citing regulatory hurdles and the complex human terrain as key hurdles, but few would agree that China can be disregarded. Onshore, the private banking space remains in its nascency, although the sheer scale of the market in terms of population and wealth creation means that a number of domestic institutions have themselves achieved considerable scale in recent years.

Wang Jing general manager China Merchants Bank Private Banking

China Merchants Bank (CMB), winner of the Best Private Bank - China Domestic award for 2016, has been a major benefactor of rapid onshore wealth creation, with assets under management reaching a mammoth RMB1,423.7 billion and client numbers swelling to 53,954 midway through 2016 (private banking clients must have minimum total daily average assets of RMB10 million per month). Scale itself is no guarantee of quality, however, and CMB Private Banking spent 2016 further developing and refining its offering to remain ahead of a rapidly evolving industry of ‘traditional’ private banks and wealth managers. Key recent initiatives include a “scientific” asset allocation system that has been configured for the China market, the implementation of what the bank calls the “4-Step Spiral Lifting Working Method” - a process designed to ensure that clients are consistently presented with the most suitable solutions - and the introduction of a door-to-door offering to complement its global hotline, whereby managers can provide core services to clients “outside” the bank. And, reflecting a growth in demand for wealth planning services in China, CMB Private Banking further added to its team of tax consultants and legal advisors, while enhancing its consultancy services for immigration, children’s education and private collections. Ultimately, CMB Private Banking rounded out 2016 with healthy pre-tax profits and a cost/income ratio well-below the offshore industry average. Furthermore, the bank is well-positioned to increase its share of the international Chinese market, with a growing network of overseas branches, including in Singapore, Luxembourg and New York. China Merchants Bank is Asian Private Banker’s Best Private Bank - China Domestic for 2016.

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N OA H PR I VATE W EALTH MA NAGEM ENT

nprecedented economic growth in China has created profound opportunities for private banks and wealth managers to harness a HNW market that, by global standards, remains severely underpenetrated. And as the first private wealth manager in China, Noah Private Wealth Management has enjoyed something of a firstmover advantage. Even so, Noah PWM has continued to develop and refine its offering to remain at the forefront of the Chinese wealth management industry, boasting a differentiated and innovative product platform, a strong talent pool and second-to-none coverage of China’s complex human terrain.

Kenny Lam group president Noah Holdings

Noah PWM has a client pool of over 110,000 clients (over half of which are business owners) with average investable assets of over US$30 million and a demonstrated track record of transacting. Moreover, the firm’s penetration of Chinese HNW clients is not limited to tier one cities, but rather includes second and third-tier centres where China’s entrepreneurial verve is in full swing and the demand for quality investment opportunities remains unsated. Its team includes 1,098 relationship managers (RMs) with a remarkable 0% turnover rate amongst high-performing RMs. Noah PWM has carved out a name for itself by bringing to clients exclusive opportunities, particularly in the private equity, hedge fund and real estate spaces, leveraging Noah’s asset management arm, Gopher Asset Management, and partnerships with leading global players. And its ethos is simple: if it takes care of clients’ money, the rest will come. To this end, the firm employs a stringent and rigorous, multi-step due diligence process on all products to ensure that only bestin-breed solutions reach the shelf. 2016 will go down as a formative year for the Noah Group as a whole. Now more than ever, Chinese investors are looking to diversify internationally. Understanding this, Noah became the first Chinese wealth manager to establish a Silicon Valley office with a complete investment team and to obtain a trust licence in Jersey. It continues to grow its Hong Kong-based business at a rapid clip and was the first Chinese wealth manager to obtain Type 1, 4, 9 licences from Hong Kong’s Securities and Futures Commission. “We believe the China onshore market is one of the most important wealth markets globally. Noah has been a leader and pioneer in private wealth services in China for 14 years”, says Kenny Lam, group president, Noah Holdings. “We will continue to focus on what is most important – long-term stability, value for our clients, and continued innovation in products and services.” Noah Private Wealth Management is Asian Private Banker’s Best Wealth Manager - China Domestic for 2016.

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STA N DA R D C HARTER ED

hen foreign private banks look towards India, they typically see a US$797 billion1 opportunity ripe for the picking. But India is a market where the homeground advantage counts for a lot and, recently, foreign players have struggled in the face of stiff competition and regulatory complexities. Moreover, the UHNW space is becoming increasingly crowded with local outfits that typically leverage independent stock broking houses, putting them in direct competition with independent asset managers, family offices, private equity firms and, of course, wealth managers.

Sandeep Das head, private banking clients India Standard Chartered Bank

An exception to this is Standard Chartered Private Bank. With a deep-rooted history of 150 years, universal banking capabilities and a comprehensive network, Standard Chartered Private Bank stands out for its ability to draw upon its tie ups with its securities and brokerage entities and non-banking finance company to bring clients an innovative suite of solutions and services. 2016 was a year when Standard Chartered’s private banking business in India delivered strong financial results, headlined by a 50% YoY increase in assets under management (as of October 2016), robust profits and a healthy cost/income ratio. Standard Chartered’s ‘one bank’ approach has helped it deliver new business throughout its client pool, with clients enjoying a full-spectrum offering, including private equity, lending, mortgages and corporate banking. Leveraging the whole bank has enabled Standard Chartered’s private bank to keep costs and talent-related pressures in check. Investments in talent in 2016 resulted in a net increase in frontline numbers, while institutionalised training and feedback mechanisms have helped keep retention rates high. On the tech front, Standard Chartered Private Bank’s pledge of US$250 million to build a single wealth management platform across its regional offices has had a positive effect on its India operations. “We support our clients through our team of experienced bankers who understand their needs and can provide them with access to a comprehensive suite of wealth management offerings, even in increasingly challenging market conditions,” says Sandeep Das, Standard Chartered Private Bank’s India head. “Our strong balance sheet further enables us to provide a wide variety of lending and funding services, both domestically and across our network, to these entrepreneurs with whom we have established strong relationships.” Standard Chartered is Asian Private Banker’s Best Private Bank - India Domestic for 2016. 1

Source: Capgemini World Wealth Report 2016

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IIF L W E A LT H & ASSET M ANAGEM ENT

IFL Wealth & Asset Management, buoyed its unique operating model and India’s recent economic fortunes over the past year, had an outstanding 2016, achieving positive growth across key financial metrics.

With 22 offices across eight countries and multiple Indian cities, the domestic wealth manager has amassed US$15 billion in assets under advice, distribution and custody, and continues to build a formidable army of relationship managers, cherry-picking from top-tier foreign private banks in India.

Amit Shah co-founder and executive director IIFL Wealth & Asset Management

IIFL Wealth & Asset Management’s wholly-owned non banking finance company (NBFC) has also allowed it to consistently deliver a deep shelf of innovative in-house products, portfolio customisation and wealth structuring services to India’s wealthy individuals and families. “Product innovation has been a strong driving force at IIFL Wealth & Asset Management, and we have the expertise to manage multiple asset classes,” says Amit Shah, co-founder and executive director, IIFL Wealth & Asset Management. “As the leading wealth management company in India, we have positioned ourselves to participate in a larger share of the client’s wallet by offering family office, estate planning and offshore advisory.” IIFL Wealth & Asset Management’s employee ownership model, whereby employees are offered a 25% stake in the firm, has engendered high employee retention rates in an industry well known for its shortage of quality talent. Furthermore, IIFL Wealth & Asset Management has rolled out an impressive dossier of digital initiatives to keep pace with the evolving needs of high net worth individuals and emerging entrepreneurs in India, offering services to clients across a range of channels, including mobile and social media, and employing advanced analytics and cloud-based computing. IIFL Wealth & Asset Management is Asian Private Banker’s Best Wealth Manager - India Domestic for 2016.

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B NP PAR I B AS

lobally, the non-resident Indian (NRI) market accounts for US$1 trillion according to market estimates - a fact not lost on private banks in Asia, which continue to channel resources towards this investment-savvy segment.

BNP Paribas Wealth Management’s NRI strategy stands out among its peers. By bringing its NRI and India onshore businesses under one umbrella and a single market head, the private bank has put in place a structure that is conducive to a seamless flow of resources and market intel between the two previously distinct offerings. Accordingly, NRI clients interface with advisors that are well-versed in India-centric products and opportunities.

Samir Bimal head of Indian markets BNP Paribas Wealth Management

Examples of the bank’s ability to cater to the unique palettes of ultra high net worth NRIs include its bespoke capital protected structured notes with leverage and its diversified bond portfolios with an Indian flavour. NRI bankers can source India-specific corporate deals internally and, more generally, collaborate with India onshore bankers to share knowledge and generate ideas. “With over 150 years’ history in India, experience covering NRIs across the world, long standing client relationships, integrated client approach, demonstrable business growth and backing of the BNP Paribas group, the NRI business within BNP Paribas WM Asia has evolved to a leading franchise in the industry,” says Samir Bimal, BNP Paribas Wealth Management’s head of Indian markets. BNP Paribas Wealth Management’s unique NRI strategy has translated to successful business performance: the private bank’s NRI assets have grown at a healthy CAGR of 31% and maintained healthy revenues. BNP Paribas Wealth Management is Asian Private Banker’s Best Private Bank - NRI Services for 2016.

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CR E DI T SUI SSE

ew and far between are those instances where a single foreign bank has come to dominate an Asian market in both investment and private banking. In Indonesia, however Credit Suisse has done just that, and is today the poster child of the ‘one bank’ approach in Asia. In 2016, Credit Suisse sustained its competitive edge in investment banking, retaining its leading positions across equity and debt capital markets, structured lending and M&A— an area that the bank has dominated over the past 16 years, almost tripling its second closest competitor in terms of volume and number of deals.

Johanes Oeni market group head, Indonesia private banking Asia Pacific Credit Suisse

In turn, Credit Suisse has successfully grown its already mature Indonesian UHNW business, particularly among mid-sized business owners. The bank’s dominance in the Indonesian wealth market is evidenced by the fact that it maintains relationships with over half of the nation’s 150 wealthiest. This is in addition to an ongoing expansion drive that includes a deepening of market share via a targeted sweep of prospects in second and third tier cities. “Our value proposition is built on a few key pillars: local leadership that is committed to and has deep understanding of the market and a proven track record of strongly supporting our clients during crises, and having one of the largest and most experienced teams dedicated to Indonesian clients that we continue to build up strategically,” says Johanes Oeni, market group head, Indonesia, private banking Asia Pacific, Credit Suisse. “As the ‘Entrepreneurs’ Bank’, we have an excellent platform combining our established private banking legacy with being the gateway to our unique integrated bank platform for our UHNW clients and business owners, leveraging our investment banking leadership in Indonesia over the past 16 years.” The combined efforts of a universal bank typically benefits multiple business lines; and in the case of Credit Suisse’s private banking arm, the Swiss bank’s prowess in Indonesia has translated into robust profit growth and an increase in client assets of over 10% (CAGR) over the past few years. Credit Suisse is Asian Private Banker’s Best Private Bank - Indonesia International for 2016.

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B A NK M ANDI R I

or the Indonesian wealth management space, 2016 was a formative year. A government-driven tax amnesty promises to provide impetus to an already-growing HNW population that is nearing 50,000, accounting for US$161 billion in wealth.1

Indeed, Indonesia ranks among the leading countries in terms of HNWIs holding offshore investments - a fact that spells opportunity for a league onshore private banks that, while in their early stages of development, are gradually developing core offerings that are comparable to their offshore institutions.

Elina Wirjakusuma senior vice president wealth management PT Bank Mandiri - Indonesia

Bank Mandiri - one of the largest state-owned lenders in Indonesia - stands out from its domestic peers on account of its ambition to build out a sophisticated and full-spectrum private banking business that not only addresses the needs of domestic Indonesians but leverages synergies with its Singapore-based entities. In 2016, Mandiri Private - the lender’s private banking service - demonstrated strong business growth across most key metrics, including near-double digit increases in funds under management and net new assets from existing accounts, while building its frontline headcount by almost 20% YoY and achieving a 100% retention rate. Recognising the need for wealth planning and value-added services and the increasing sophistication of investor needs, Bank Mandiri has increased its core offering beyond traditional advisory to include tax consultancy and concierge services, while leveraging the group’s strong social media presence throughout Indonesia. And throughout the tax amnesty - which is scheduled to conclude in March 2017, Mandiri Private stayed close to clients by providing relevant day-by-day explanatory coverage and analysis. “Bank Mandiri is committed to catering to the needs of high net worth individuals in Indonesia,” says Elina Wirjakusuma, senior vice president wealth management, PT Bank Mandiri (Persero) Tbk - Indonesia. “We will continue to pursue our goal to be the most preferred financial institution, not only in Indonesia, but also in South East Asia. We pay special acknowledgement to our customers, who have been the driving force behind our growth and improvement.” Bank Mandiri is Asian Private Banker’s Best Private Bank - Indonesia Domestic for 2016.

Source: Capgemini World Wealth Report 2016

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CR E DI T SUI SSE

redit Suisse’s group success in providing financial services to Malaysian businesses and their owners is proof of its continued success in following the “one-bank” approach. Strong synergies with the investment bank, which boasts a leading track record and best-in-class equity capabilities, have enabled Credit Suisse’s private banking arm to amass 20 years of dedicated coverage by one of the largest teams in the industry. Already a frontrunner in the coverage of Malaysian UHNWIs - especially among the nation’s top billionaires - the private bank continued to grow its Malaysian client asset base in 2016, and at a robust CAGR of over 10% over the past five years.

Marcus Slöör market group head Malaysia private banking Asia Pacific Credit Suisse

And Credit Suisse has matched these gains with its commitment, setting up a team of senior investment consultants dedicated to the segment; making available segment-specific investment offerings including a range of Shariah-compliant solutions or MYR money market offerings; and delivering value-added events, rich in both quality and quantity. “We have a longstanding private banking franchise covering the Malaysian market for 20 years with a dedicated team of senior bankers, and are also widely recognised as having the leading foreign investment bank in Malaysia,” says Marcus Slöör, market group head Malaysia, private banking Asia Pacific, Credit Suisse. “This unique private and investment banking platform has enabled us to build an extensive network with leading UHNWIs and business owners in Malaysia, delivering to them a differentiated service model. We are highly committed to the Malaysia market and will continue to deepen our market coverage with investments in talent and platform in order to grow our Malaysia business.” Asia is a market where streamlining and cost-saving are points of focus and the Malaysian wealth segment is relatively underappreciated. But while many of Credit Suisse’s peers shy away from providing dedicated coverage, Credit Suisse continues to build its platform and talent, even in the face of challenging market conditions. Credit Suisse is Asian Private Banker’s Best Private Bank - Malaysia International for 2016.

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M AYB ANK

aybank’s quest to deliver superior wealth management solutions to domestic HNWIs has resulted in the private banking business registering substantial growth - a remarkable feat given that the business was only established three years ago. Since then, Maybank’s private banking arm has posted strong double-digit growth across revenue, profitability, clients and assets, all while maintaining a stable cost/ income ratio.

Alvin Lee head of group wealth management Maybank

Maybank Private Wealth has made significant investments to its platform that are not only aimed at delivering wealth management solutions to its HNW clients, but also at providing a truly differentiated value proposition, which includes targeted discretionary mandates, customised structured products and bespoke investment counselling. Proof of Maybank’s commitment to the needs of the domestic market is its development of Shariah-compliant wealth management solutions - an initiative that has stimulated strong growth and a doubling of Islamic AUM in 2016. On the talent front, Maybank Private Wealth has continued to invest in its domestic frontline team, growing its headcount by 120% since launch, while boasting a strong tenure rate. “Maybank Private Wealth is committed to offering a complete suite of products and services to address our clients’ spectrum of banking needs and we have dedicated significant resources in building our wealth management capabilities in 2016,” says Alvin Lee, head of group wealth management, Maybank. “The implementation of the Avaloq Banking Suite in Singapore and the expansion of our business footprint to a new booking centre in Hong Kong and a Private Wealth Centre in Penang, Malaysia clearly show our ambition to be one of the top wealth management players in Asia.” With robust and consistent growth and a platform designed to help HNWIs meet their global and domestic needs, Maybank Private Wealth led Malaysia’s private banking space in 2016. Maybank is Asian Private Banker’s Best Private Bank - Malaysia Domestic for 2016.

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B A N K OF SI NGAPOR E

ank of Singapore had a formative 2016, headlined by its acquisition of Barclays Wealth and Investment Management in Hong Kong and Singapore. But the private bank’s strengths go beyond Asia’s two key offshore centres, as evidenced by its prowess in the Philippines International space, where its close synergies with parent group, OCBC, and its pedigree as a fully-fledged wealth manager have given it a leg-up on the competition. The Philippines economy grew 7.1% in 2016 bettering the rest of Asia and, since 2000, the average wealth per adult has increased by over 250%, spelling opportunity for wealth managers that are serious about committing to the Philippines.

Robin Heng global market head Indonesia and Philippines Bank of Singapore

And Bank of Singapore is serious. By leveraging OCBC’s arsenal of commercial, investment and corporate banking capabilities, Bank of Singapore has carved out a niche as a wealth manager par excellence, providing best-in-class solutions for ‘underserved’ and ‘unbanked’ owners of small-to-medium enterprises in the Philippines and the wider Southeast Asian region. Bank of Singapore has assembled a formidable bench of practitioners, whose expertise and acute knowledge of the nuances and sensitivities on families in the Philippines, has significantly enhanced the quality of service and solutions it has on offer. And in 2016, it further strengthened its Philippines-focused team with key hires across the ultra high net worth, family office and institutional clients spaces. “Besides having a trusted private banker who can manage their personal wealth, many of them [UHNWIs and HNWIs in the Philippines] are increasingly looking for one who can help them on the business front as well. We have been able to fulfil this need through the synergy with our parent company, OCBC Bank,” says, Robin Heng, global market head, Indonesia and Philippines, commenting on Bank of Singapore’s unprecedented third-time win. Bank of Singapore is Asian Private Banker’s Best Private Bank - Philippines International for 2016.

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Private banks’ AML budgets unchanged despite Panama Papers, 1MDB shocks Private banking COOs tell Asian Private Banker that their anti-money laundering (AML) and compliance tech spend has seen little-to-no change over the past six months, despite the industry witnessing a number of seismic events, including the Panama Papers data leak and the 1MDB scandal.

WHICH OF THE FOLLOWING ‘RECENT’ EVENTS HAD THE GREATEST EFFECT ON YOUR AML AND COMPLIANCE-RELATED PROCESSES?

WHAT % OF YOUR TECHNOLOGY BUDGET IS ALLOCATED TO AML?

More than 20% 9%

1MDB

Others

19%

43%

- Voluntary Disclosure Programs - Amnesty in Indonesia - China graft takedown - Sports scandals (FIFA, IOC)

According to polling conducted at the Asian Private Banker COO Leaders Conversation 2016 in Singapore, 43% and 38% of COOs said that the Panama Papers and 1MDB events had the greatest impact on internal AML processes, respectively. However, 73% of attendees revealed that their AML tech budgets have remained in the 1-10% range, effectively unchanged from six months ago. The Panama Papers leak and 1MDB investigation have shone light on private banks’ AML processes, with a number of institutions falling afoul of regulators. This year alone, Falcon Private Bank’s Singapore branch and BSI Singapore had their merchant bank licences revoked by MAS after both banks were implicated in illegal fund flows linked to Malaysia sovereign fund, 1MDB.

The Singapore watchdog also slapped UBS Singapore and DBS with fines totalling S$1.3 million and S$1 million due to breaches of AML controls.

“The information that flows through from the RM’s onboarding experience plays a vital role in the due diligence process post-onboarding,” he said.

Most COOs said that it is easier to justify increasing their tech spend on KYC-related tools given regulatory scrutiny over client onboarding, but that AML technology does not fall under this category.

Other attendees pointed to the need to strengthen the relationship between RMs and compliance teams to ensure that data flow is cross-checked.

“KYC does not equal AML,” one Singapore-based COO said, adding that it takes time to build a solid AML process. “AML is leveraging the information you receive when the client enters the bank and this takes time to build up.”

A survey conducted by risk management firm LexisNexis Risk Solutions found that technology costs - overshadowed by personnel costs - make up 19% of AML budgets at banks. The survey estimated that the total financial industry budget dedicated to AML and compliance averages US$1.5 billion annually.

Another head of IT agreed, pointing out that private banks need to concentrate on getting their client onboarding processes “right” before investing in robust AML technology. ASIAN PRIVATE BANKER

B DO

ell placed to grasp opportunities presented by a rapidly growing economy and HNWI population, BDO Private Bank has established itself as the go-to institution for private banking clients in the Philippines, and efforts taken to further develop its offering have led to strong financial results in 2016.

Josefina Tan president BDO Private Bank

Not only does BDO Private Bank offer a full-spectrum service, including advisory and discretionary portfolio management, but the bank’s holistic wealth planning platform has enabled it to meet a diverse range of financial goals and objectives set by their clients across insurance, philanthropy, retirement and new business venture requests. Furthermore, BDO Private Bank can tailor solutions according to a client’s specific circumstances, income requirement, liquidity and risk profile. While using an open architecture model, the private bank also leverages its relationship with BDO Unibank, bringing clients an institutional-like offering on par with many offshore players. It is also committed to developing top-tier talent via its in-house training programme, which places a specific focus on estate structuring and trust planning. Today the private bank boasts a team of around 40 relationship managers and a separate team of seven wealth advisors. “BDO Private Bank’s capabilities and expertise in the field of domestic private banking has resulted in the trust and confidence of our clients, entrusting us to over 330 billion pesos in assets for advice and management,” says Josefina Tan, president, BDO Private Bank. BDO Private Bank is Asian Private Banker’s Best Private Bank - Philippines Domestic for 2016.

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UB S

BS Wealth Management’s coverage of high net worth Taiwanese has reached a nearly unparalleled level of maturity in recent years and, in 2016, the Swiss major showed little sign of slowing down.

UBS aggressively grew its Singapore-based Taiwanese business and demonstrated stellar multi-shore financing capabilities, all the while retaining a dominant market share without diluting talent seniority - 70% of its client advisors boast more than a decade worth of banking experience.

David Man regional market manager Taiwan UBS Wealth Management

With an unwavering ambition to seek out and groom top talent, UBS regularly conducts cross-border Taiwanese hires and boasts intensive segment-focused training programmes catered to various levels and functions. Helmed by a remarkably stable management team, the bank has grown the Taiwan wealth unit’s front office at a steady CAGR of 9% since 2011. And it continues to demonstrate a commitment to the market, with a myriad of local initiatives that include value-added events, next-gen programmes and an impressive longstanding track record of corporate social responsibility - a point that does not contribute to the adjudication process, but is worthy of note nonetheless. “Our team is committed to pledge their best,” says David Man, regional market manager, Taiwan, UBS Wealth Management. “Leveraging our global network and holistic wealth and succession planning capabilities, we offer a total wealth approach to achieve inter-generational wealth preservation for our clients.” A truly international Taiwanese presence that leverages a global platform and a seasoned team has helped UBS Wealth Management maintain top ranking in this space. UBS is Asian Private Banker’s Best Private Bank - Taiwan International for 2016.

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UB S

oreign banks, by their very nature, face a more challenging competitive environment when operating in onshore markets. Differences in regulations, platform needs and operational nuances can create significant headwinds for foreign institutions when competing against local incumbents who typically enjoy natural home market advantages, including sizeable branch networks.

Dennis Chen group managing director Taiwan country head UBS Wealth Management

In Taiwan, UBS Wealth Management has proven itself to be an exception to the rule. But rather than riding the wave of popular local market trends, the bank’s offering remains consistent with its global proposition. Uncompromisingly espousing its belief in global diversification and portfolio-centric investing, UBS has gone against the tide of Taiwan’s popular but risky brokerage-oriented market. Such risks were well-illustrated by troubles that beset widely distributed target redemption forward contracts linked to the yuan, which UBS did not participate in. From traditional portfolio management best practices to innovative fintech advisory solutions, UBS has established itself as a trailblazer of local Taiwanese wealth management, driving the market’s transition from active client-directed trading to professionally managed globally diversified portfolios. This year, it made the bold move to further expand its onshore business to include the mass high net worth segment with its “smart wealth” offering, which has received stellar client reception. “The award recognises the tireless work of the team in providing market-leading advice to clients,” says Dennis Chen, group managing director, Taiwan country head, UBS Wealth Management. “We are not complacent and will continue to enhance products and services to protect and grow our clients’ wealth over generations.” Very rarely do foreign players beat their local counterparts in onshore wealth management markets; but UBS has not only outperformed Taiwan peers for the third consecutive year, but has also established itself as an industry pioneer. UBS is Asian Private Banker’s Best Private Bank - Taiwan Domestic in 2016.

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CR E DI T SUI SSE

redit Suisse’s coverage of the Thailand wealth market has gone from strength to strength in recent years, but 2016 will forever be remembered as the year when the Swiss major ‘went live’ in Thailand, launching a wealth management set-up in Bangkok and effectively cementing its status as the premier provider of private banking services to onshore and offshore Thais, including a large percentage of Forbes’ Thailand’s 50 Richest list.

Christian Senn market group head, Thailand private banking Asia Pacific Credit Suisse

As with the whole of Credit Suisse’s private banking franchise in Asia, the strength of its offering is underpinned by deep group connectivity that enables the private bank to leverage the Swiss bank’s global investment banking and asset management capabilities to bring Thai clients a full-spectrum of services, including wealth planning, prime services and Thai-specific investment opportunities and financing. The new wealth management unit was set up leveraging its market-leading local securities entity which has already been operating in Thailand for 16 years and has intimate knowledge and understanding of the needs of local private, corporate and institutional clients. Onshore-offshore synergies were further enhanced between its new Bangkok-based client coverage team and its regional private banking hub in Singapore where more than 200 solutions and products specialists are based. Furthermore, Credit Suisse’s unique multi-shore collateral has opened up exclusive lending possibilities for Thai entrepreneurs. Today, the Thailand onshore and offshore team – the majority of whom are Thai with extensive experience in international investment and wealth management with both local and global financial institutions – has an average private banking experience of over 10-15 years and a stellar retention rate. Especially notable is the landing of a 30-year veteran to head out the bank’s wealth management operations in Thailand – a hire that was widely recognised in the market. The results speak for themselves. Credit Suisse has posted strong double-digit CAGR in assets under management and revenue over the past four years, exceedingly high net new money growth and a double-digit increase in pre-tax profits in the first nine months of 2016. “2016 was an exciting year as our new wealth management set-up went live in Bangkok, uniquely leveraging our leading local securities entity,” says Christian Senn, market group head Thailand, private banking Asia Pacific, Credit Suisse. “It complements and connects with our teams in Singapore, offering Thai clients access to a comprehensive international investment and wealth management platform via our regional private banking hub. As we continued to further enhance this seamless platform with truly integrated private banking and investment banking capabilities and holistic services and solutions especially for our Thai entrepreneur clients, we have seen accelerated growth momentum in 2016.” Credit Suisse is Asian Private Banker’s Best Private Bank – Thailand International for 2016.

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S I A M C O MM ER C I AL B ANK

n 2016, Siam Commercial Bank demonstrated that it was a bank that listens to its private banking clients in Thailand and delivers results.

In response to challenging market conditions and a low interest rate environment, the bank was quick to implement its data-driven strategic asset allocation model and shift the product mix of its clients’ portfolios to higher yields from their existing investments, risk levels permitting.

Lalitphat Toranavikrai head of private banking Siam Commercial Bank

This responsiveness not only resulted in substantial YoY growth in foreign-invested fund and mixed fund assets under management, but customer satisfaction levels reached impressive highs. Indeed, the bank currently boasts the number one market share in mixed funds in Thailand. Throughout the year, SCB Private Bank netted key talent and groomed existing relationship managers via its wealth academy. Set up in 2015, Siam Commercial Bank’s academy has trained over 100 private banking relationship managers and trainees. It has also engaged Singapore’s Wealth Management Institute to further refine its training programme. Siam Commercial Bank is one of the few early adopters of advanced technology in Thailand, delivering its user-friendly, front-office solutions across multiple channels, including mobile applications, internet banking and social media, while maintaining strong offline engagement via its relationship managers. Furthermore, the bank continues to demonstrate its commitment to stay abreast of the latest developments by setting aside US$50 million for fintech-related investments. By year’s end, SCB Private Bank had posted healthy increases in revenues while keeping costs in check - a difficult feat in today’s challenging market. “We are excited about the progress we have made and our direction for the future,” says Lalitphat Toranavikrai, head of private banking, Siam Commercial Bank. “We are establishing a new platform for growth in both customer base and revenue potential. We strongly believe that this new platform will synergize all aspects of our wealth management business.” SCB Private Bank is Asian Private Banker’s Best Private Bank - Thailand Domestic for 2016.

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EDITORIAL

Eight exclusive data points that mattered in 2016 Asian Private Banker dips into its extensive pool of prop data to showcase eight of the most important data points for private banks over the past 12 months.

ASIAN PRIVATE BANKER

20% INCREASE IN FUND FLOWS? Following a challenging year for markets and private banks, Asia’s fund gatekeepers are optimistic about 2017, with more than 80% forecasting an increase in fund flows of up to 20%.

DPM’S BIGGEST HINDRANCE Almost 70% of DPM leaders at private banks in Asia say that ‘performance’ is the biggest hurdle to DPM sales.

LOW DEMAND FOR LIQUID ALTS

WANT QUANT?

Private banks and independent asset managers rated Asian HNWIs’ appetite for liquid alternatives at just 4.73 out of a possible 10, with many respondents citing performance-chasing as the primary culprit for limited demand.

Private banks’ clients remain lukewarm on quant strategies, with an average rating of 2.33 out of a possible 5. Less than 7% of respondents rated client appetite above 3.

13.75% DROP IN SP FLOWS

1MDB-WARY

Following the Shanghai Composite’s 2015 plunge, which continues to weigh heavily on investors’ minds, private banks’ transactional income experienced a 13.75% average drop in structured product flows in Asia during the first three quarters in 2016.

82% of COOs in Asian private banks think 1MDB had the greatest effect on their AML and compliance-related processes, followed by the Panama Papers leak. Even so, data shows that there was little-to-no change to AML and compliance tech budgets.

LOW DPM PENETRATION RATES

51%: INSURANCE IS CRUCIAL

68% of private banks in Asia have a DPM penetration rate of less than 10%, of which more than half recorded penetration rates below 5%, although this figure is increasing incrementally.

Asian HNWIs have a relatively high appetite for insurance products, with 51% of the senior relationship managers and wealth planners in private banks indicating that insurance is crucial in the context of the bank’s wealth planning offering. 19% of respondents said that insurance is extremely crucial. ASIAN PRIVATE BANKER

HSB C

he discussion in 2016 veered sharply towards Asia’s intergenerational wealth transfer and the opportunities this poses for the region’s private banks. Similarly, complex shifts in the regulatory environment call for experts who not only understand what this means for private banking clients and their wealth, but who have the solutions to ameliorate this complexity. Little surprise then that the Best Private Bank Wealth Planning Services category was one of the most heavily contested in 2016.

Christopher Marquis global head of Private Wealth Solutions HSBC Private Bank

Against this backdrop, HSBC Private Bank has once again distinguished itself from the competition, headlined by the bank’s Private Wealth Solutions (PWS) unit, helmed by Christopher Marquis, global head of Private Wealth Solutions, HSBC Private Bank, and populated with one of the deepest benches of specialists in Asia and beyond. Running on a separate P&L, PWS effectively operates as an independent business entity, bringing clients best-in-class bespoke solutions and services, including wealth planning and multi-jurisdictional structuring, philanthropy, family governance and insurance, all the while benefiting from deep group-wide synergies. Much has been made over the years about the advantage that HSBC Private Bank gleans from its long-standing relationship with the region’s wealthy - a sure benefit of being a first mover in the region - but this fact should not be downplayed. Such is the intimacy HSBC’s PWS business has with the region’s leading families across multiple generations that the private bank is well-positioned to remain the primary provider of trust and fiduciary services for years to come. Even so, Private Wealth Solutions has not rested on its laurels, but rather continues to develop and refine its offering in line with clients’ evolving needs and shifts in the global regulatory environment. It also helps that the unit continues to post strong YoY growth across key financial metrics, including assets under administration. “Our long term commitment of resources and expertise to family trust and succession planning not only differentiates us from some of the other service providers, it is also one of the main reasons why our clients turn to us for their wealth planning needs, says Marquis. “In many cases, we are advising the second, third or even fourth generations of major business leaders and their families on wealth structuring, continuity planning, intergenerational wealth transfer and family governance.” HSBC Private Bank is Asian Private Banker’s Best Private Bank - Wealth Planning Services for 2016.

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CR E DI T SUI SSE

n May 2016, Asian Private Banker exclusively reported Credit Suisse’s blockbuster delivery of a fixed maturity bond fund to its high net worth clients in Asia - a play that opened the floodgates in the region, prompting numerous players to follow suit. But make no mistake: this successful distribution - evidently tapping into a region-wide demand for predictable income and product simplicity - was just one example of the bank’s deep understanding of its clients.

Rodolphe Larqué head of funds and ETFs private banking Asia Pacific Credit Suisse

2016 was a year when Credit Suisse’s gatekeepers successfully distributed fund solutions that addressed both generic and specific investment needs, all while generating strong outperformance rates - close to 80% of the private bank’s top selections outperformed the benchmark. Clients responded, leading to a standout year for fund inflows, on top of the bank’s deep fund penetration of client assets. “The Credit Suisse fund advisory platform is built on a few key value propositions: combining both selection and advisory in the same team, having analysts close to the market, covering both active and passive fund solutions, with a strong open architecture and a comprehensive selection approach that strikes a right balance between quantitative and qualitative analysis,” says Rodolphe Larqué, Credit Suisse’s head of funds and ETFs, private banking Asia Pacific. “This is further supported by our unique focused approach, engaging fund providers through a clear framework and rules of engagement, as well as a strong emphasis on after-sales based on latest market events and making full usage of technology.” And Credit Suisse has done this all without compromising its stringent, comprehensive fund selection process that narrows down a 50,000-strong fund universe into an elite minority. The Swiss major has also bred a culture of collaboration with asset managers, opening lines of communication and access in a controlled manner, resulting in enhanced product knowledge and client experience. Credit Suisse is Asian Private Banker’s Best Private Bank - Fund Advisory Services in 2016.

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G O L DM AN SAC HS

ith the outlook for traditional equity and fixed income markets growing increasingly ambiguous, global investors are rapidly warming to alternative asset classes to generate returns. Asian investors are no exception, headlined by a mass spree of Chinese outbound investments into private markets for a plethora of motives, including long-term investing in “new economy” sectors; the expansion of existing business into global markets via M&A; and, of course, diversification.

Jean-Paul Churchouse head of alternative capital markets private wealth management Goldman Sachs

This year, Goldman Sachs sated this appetite by launching a slew of new offerings across liquid alternatives, smart beta, real estate and ESG (environmental, social and governance) investing. Even in a year when the broad hedge fund industry underperformed and investor appetite dried up, Goldman Sachs was able to call upon its bargaining power and product innovation capabilities, including hedge fund-linked structured products and hedge fund discretionary solutions. It also made a stellar showing in private markets, offering clients a flurry of deals by leveraging its global network to source exclusive and interesting opportunities covering an extensive range of industries and strategies. More than just access or exclusivity, Goldman Sachs is not merely peddling deals without substance—it has an impressive performance track record, meeting nearly all of its annual target returns for its private market investments. “We work across regions to bring global offerings to clients, and provide a high degree of customisation given our focus on the ultra high net worth segment,” says Jean-Paul Churchouse, head of alternative capital markets at Goldman Sachs Private Wealth Management. “We’ve been growing AUM in alternative investments but what’s more important is our focus on offering clients the best advice and solutions.” Clients responded, resulting in strong double-digit asset growth and a high client penetration rate. With a robust deal flow, strong due diligence capabilities, sustained growth and a best-in-class performance track record, Goldman Sachs had a year to remember. Goldman Sachs is Asian Private Banker’s Best Private Bank - Alternative Investments for 2016.

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HSB C

hilanthropy is gaining traction among Asian investors, with entrepreneurs and next-generation wealthy keen for guidance beyond the boundaries of blank check charity. Few if any private banks in Asia can match the depth of expertise and long-standing relationships HSBC Private Bank boasts across a diverse range of over 100 non-profit organisations - facets that, in 2016, set HSBC Private Bank and its Private Wealth Solutions business apart from the rest.

Cynthia D’Anjou-Brown head of philanthropy advisory and family governance advisor Private Wealth Solutions HSBC Private Bank

“Our Private Wealth Solutions (PWS) was a forerunner among global banks in introducing a dedicated and specialist philanthropy advisor for Asia-Pacific, and has continuously engaged philanthropy team members with extensive non-profit experience,” says Cynthia D’Anjou-Brown, head of philanthropy advisory and family governance advisor, Private Wealth Solutions, HSBC Private Bank. Deep roots and relationships - particularly in the Hong Kong NGO community - have enabled HSBC Private Bank to offer its clients a range of philanthropic strategies including tailored solutions and, importantly, to amass a comprehensive and robust data set for due diligence purposes. Indeed, the sustainability of a philanthropic programme is only as strong as its solutions track record and HSBC Private Bank’s systematic approach to data gathering has translated into a best-in-class offering. For many Asian families, philanthropic initiatives have become the preferred means to discuss wealth succession plans and to articulate familial and corporate values, and HSBC Private Bank’s five-step approach, which involves fleshing out, evaluating and reviewing clients’ philanthropic interests, has proven especially effective at institutionalising collective decision-making. “For us, philanthropy is a key ingredient in family harmony, unity and continuity as it contributes to effective family governance,” adds D’Anjou-Brown. Further setting HSBC Private Bank’s philanthropic offering apart is its proven ability to run its philanthropy services as a profitable business through its flexible fee model that provides a full suite of philanthropic services, especially around charitable trusts administration and advisory. And in 2016, charitable donations doubled, while the number of charities PWS works with increased significantly. HSBC Private Bank is Asian Private Banker’s Best Private Bank - Philanthropic Services for 2016.

AWA RDS F O R DISTINC TIO N 2016 49

CR E DI T SUI SSE

n 2016, Asia’s independent or external asset management (EAM) industry continued along its growth trajectory, with almost half of Hong Kong and Singapore-based firms posting a 20% YoY increase in client assets (as of late-November 2016), according to Asian Private Banker data. This puts the industry on track to meet some lofty projections: Hong Kong’s Association of Independent Asset Managers expects EAMs to account for 30% of client assets under management in the city within the next 5-10 years, while a recent industry report states that Asia’s EAMs could manage as much as US$56 billion by 2020.1

Sascha Zehnter head external asset manager Asia Pacific platform private banking Asia Pacific Credit Suisse

Unlike other award categories, the winner of the Best Private Bank - External Asset Managers’ Choice category is decided by popular vote. And in 2016, EAMs in Hong Kong and Singapore selected Credit Suisse as their private bank of choice, citing its servicing capabilities, investment solutions and expertise as key differentiating factors. Indeed, a consistent theme throughout all feedback was Credit Suisse’s ability to cater to the entire spectrum of an EAM’s increasingly complex set of needs. “Based on my experience over the past decade, Credit Suisse has the best EAM platform for a number of reasons,” said the founder and managing partner of a prominent set-up in Singapore, who singled out the bank’s 24-hour Customer Care Centre and the extensive knowledge of Credit Suisse staff as core strengths. Similarly, the founder of a Hong Kongbased EAM, who said that “the choice is simple”, praised Credit Suisse for its pricing and institutional-like investment solutions, backed by a team of expert of advisors. “We thank the external asset management industry in Asia for its vote of confidence in Credit Suisse as the Best Private Bank for EAMs,” says Sascha Zehnter, head external asset manager Asia Pacific platform, private Banking Asia Pacific, Credit Suisse. “Our EAM desk offers a dedicated team of relationship managers and investment advisors backed by a comprehensive IT platform, access to open architecture and a full range of investment banking and wealth management solutions, choice of geographical booking locations, and a strong brand name, among others. In the coming years, we will continue to focus our investments in the key areas of differentiation that will further advance our market position.” Credit Suisse is Asian Private Banker’s Best Private Bank - External Asset Managers’ Choice for 2016.

Source: Julius Baer, Independent Asset Manager Report: Asia, 2014

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UB S

lowly but surely, HNWIs in Asia are coming to understand the value of discretionary portfolio management (DPM) solutions, especially in a difficult market environment that demands an immediate response to market events, global diversification and professional know-how. Earning the trust of clients to the extent that they are willing to delegate their assets is the ultimate prize for private banks that follow the Swiss tradition of long-term wealth preservation.

Stefan Lecher head of client portfolio management, APAC investment products and services UBS Wealth Management

But any daring venturer will admit that achieving deep DPM penetration rates in Asia is no easy feat. This has not been helped by the fact that the size and diversity of client accounts at large private banks creates hurdles for consistent performance, customisation and personalised servicing. UBS Wealth Management’s staunch promotion of DPM as a primary pillar for core investments could lead some to mistake the Swiss giant for a pure play. Its commitment to DPM is remarkable, as evidenced by: a budget that includes a significant share of its US$1 billion IT spend; abundant internal initiatives that involve onshore DPM-specific events; and a series of innovative mandates that address specific needs, including discretionary private equity solutions or quant strategies that reduce portfolio volatility. “UBS’ success in discretionary portfolio management has been a function of platform, innovation, and communication,” says Stefan Lecher, head of client portfolio management APAC, investment products and services, UBS Wealth Management. “We have invested in ensuring our platform is world class and have launched several new and innovative strategies drawing on our global chief investment office. We also invest tremendous time, energy, and creativity in determining how best to guide our client advisors and our clients in using UBS’ discretionary capabilities, which is ultimately a matter of effective communication.” The results speak for themselves: UBS in Asia boasts an above-average penetration rate, robust performance and a rapidly-growing UHNW DPM business. Yes, the journey to close the gap between Asian and European HNWIs who are well-accustomed to the approach may be far from over; but in 2016, UBS Wealth Management led the rest. UBS is Asian Private Banker’s Best Private Bank - Discretionary Portfolio Services for 2016.

AWA RDS F O R DISTINC TIO N 2 016 51

J. P. M OR GAN

sea change is afoot within Asia’s UHNW segment, spurred on by the structural transformation of economies in the region. Accordingly, old economy participants are seeking to scale and diversify their business portfolios, placing a greater emphasis on wealth preservation, while new economy participants are jostling to harness the region’s potential. In anticipation, many private banks are ramping up their offerings by surrounding UHNW clients and their relationship managers with a plethora of resources, including seasoned specialists in financing, investments and wealth planning.

Andrew Cohen chief executive officer international private bank J.P. Morgan

J.P. Morgan Private Bank in Asia holds the esteemed status of being an early adopter of this high-touch UHNW business model - one that peers are only now attempting to replicate. Having long promoted this multi-pronged private banking approach to a client base that includes more than 60% coverage of top billionaires across multiple Asian jurisdictions, J.P. Morgan has successfully established itself as the first port of call for UHNW needs. 2016 was an especially telling year for J.P. Morgan Private Bank, which delivered strong regional revenue growth despite an industry-wide plunge in transactional volumes that negatively impacted many rivals. One noteworthy aspect of J.P. Morgan’s approach is its focus on risk - it has fostered a legitimate culture of risk aversion that precedes revenue concerns. Indeed, the bank adopts a level of stringency that far surpasses established controls, despite mounting compliance costs. “At J.P. Morgan, we have been significantly streamlining our processes with an aim to be the most efficient private bank in the world while meeting or exceeding our regulatory obligations, both locally and globally,” says Andrew Cohen, chief executive officer, international private bank, J.P. Morgan. “As business leaders, we need to reflect on the evolution of the private banking business model and the costs of operating in a new environment with additional thoughtful and efficient risk controls.” With a longstanding model focused on delivering the full suite of wealth management solutions backed by strong focus on risk, talent and client experience, and demonstrated growth in adverse conditions, J.P. Morgan stood apart from the competition in 2016. J.P. Morgan Private Bank is Asian Private Banker’s Best Private Bank - UHNW Services for 2016.

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CR E DI T SUI SSE

he fact that so many private banks in Asia remain in a trial and error phase in their digital strategies speaks to the long way the industry has to go before it can consider itself truly tech-advanced. The same cannot be said about Credit Suisse - a bank that is not only at the cutting edge of innovation but, crucially, is a leader in terms of bringing its innovations to market. Having released its digital private banking solution in Singapore and Switzerland in early 2015, Credit Suisse continued with its Asia rollout in 2016, with the launch of its digital platform in Hong Kong, demonstrating its commitment to the region and, ultimately, its commitment to driving technological advancement in the private banking space.

Christian Huber COO private banking Asia Pacific Credit Suisse

What sets Credit Suisse apart from its competitors is its attention to the finer details: clients can transact equities, ETFs, REITs and FX Forwards and communicate with RMs around the clock across multiple channels, including mobile, tablet and desktop. Further, the solution is available to the relationship manager. “In 2016, a year on since the launch of our Digital Private Banking platform, we continue to engage our clients to innovate and enrich their digital experience with a series of enhanced features while launching the private banking Asia Pacific App in our Hong Kong hub, and have seen strong client traction,” says Christian Huber, COO, private banking Asia Pacific, Credit Suisse. Credit Suisse has implemented a powerful data analytics engine to harness structured and unstructured data to create a portfolio overview function, a risk analyser and a curated watchlist with notifications in real time. Credit Suisse is not resting on its laurels, instead consistently enhancing and refining its digital offering. It recently added a layer of biometric security to its mobile and tablet application and rolled out “RM Ecosystem” - a front office tool that “bring[s] together all the critical information and insights required to serve the client,” Huber explains. A further point of differentiation is the accountability Credit Suisse brings to its tech investments: the bank utilises a predefined set of ROI metrics and has demonstrated a significant uptick in the client adoption rate, user engagement time and trading volumes via the solution. For the second year running, Credit Suisse is Asian Private Banker’s Best Private Bank Digital Experience.

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CR E DI T SUI SSE

sia’s ultra-rich will pass on US$1 trillion to a younger generation in the next ten years and US$3 trillion in next 30 years. Accordingly, private banks are sparing no expenses to build lasting relationships with the ‘next generation’ of clients - a point exemplified by the sheer competitiveness of submissions for this Award category. But not all private banks have put in place a suite of programmes that encompasses the entire ‘journey’ of the next generation - from youth to family head.

Christine Tan head of marketing private banking Asia Pacific Credit Suisse

Credit Suisse’s next-gen offering does just this, however. Catering to different age groups and life stages, the Swiss bank offers a comprehensive, multi-regional suite of tailored programmes and seminars that addresses key issues facing the children of UHNW clients. These range from overseas education seminars that help Asia’s wealthy families chart their children’s tertiary education journey and equip them to take over the reins of family businesses, to programmes that aim to strengthen family ties, prepare families for a wealth transfer and groom the next tycoon. Furthermore, Credit Suisse is the sole sponsor of the global “Young Investor Organisation”, a close knit network of alumni that has amassed over 1,000 members since its inception and provides a forum for the next generation of influential families to exchange ideas and knowledge across finance, business and personal development. “We take pride in offering innovative ideas and opportunities that positively impact our next generation’s financial and professional lives,” says Christine Tan, head of marketing, private banking Asia Pacific at Credit Suisse. “These programmes essentially help the next generation to feel more confident in asking the right questions, dealing with finance, helping to better prepare them for the responsibility of running the family business or managing the family’s wealth.” Significantly, Credit Suisse has clearly demonstrated that its next-gen programme has contributed positively to the bank’s net new asset flows and independently verified attendee feedback has been resoundingly positive. Credit Suisse is Asian Private Banker’s Best Private Bank - Next-Gen Programme for 2016.

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UB S

he hype surrounding the rise of fintechs reached fever pitch in 2016 and private banks responded by putting in place strategies to harness disruptive technologies. However, few institutions in Asia have shown that they are capable of producing solutions that are both innovative and relevant to private banking. UBS Wealth Management is a rare exception. With a dedicated fintech innovation lab in Singapore that is populated with forward-looking tech specialists and thought leaders, the Swiss bank today sits at the cutting edge of innovation, with an enviable record of developing, trialling and rolling out solutions that advance private banking.

Ketan Samani chief digital officer Asia Pacific UBS Wealth Management

In 2016, UBS teamed up with academics, fintech startups and its own clients to create a number of solutions, including a virtual assistant tool and a statement consolidation platform - innovations that are conspicuously absent in the market. And it is currently working with 20 external fintech startups on areas as diverse as client experience, engagement and big data. UBS is also developing client acquisition and electronic signature solutions and piloting a series of programmes that use artificial intelligence to help clients with their investment decisions. The depth of UBS Wealth Management’s commitment to innovation is well-exemplified by its early investment into automated advisory technology and the development of UBS Advice.

Geoffroy de Ridder managing director and operating head, Asia Pacific UBS Wealth Management

“This award is testament to how UBS is leveraging disruptive technology to maintain our leadership position in Asia,” says Ketan Samani, chief digital officer, UBS Wealth Management APAC. “UBS EVOLVE lab and its startup partners create a virtuous cycle that ultimately increases bank-wide productivity which impacts client experience positively. This allows UBS to stay ahead of the curve.” “We invested in innovation to leverage the opportunities from emerging technologies. This success is based on our founding partnership between UBS EVOLVE and MAS as well as the startups in the thriving Singapore ecosystem,” said Geoffroy de Ridder, managing director and operating head, UBS Wealth Management Asia Pacific. “UBS’ strong client focus drives us to deliver best-in-class solutions, and that’s what we’ll continue to do. I am immensely proud of this award.” UBS is Asian Private Banker’s deserved winner for Best Private Bank - Tech Disruption in 2016.

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EDITORIAL

New data points to client onboarding pains at private banks Private banking COOs and heads of technology, partaking in a roundtable discussion, expressed scepticism over the deployment of a digitised client onboarding process, citing a number of hurdles via a live poll. Is your onboarding process paper-based or digital?

“We are well aware that our clients multi-bank and can therefore join a rival bank at a faster pace. However, we have not been able to prove that a digital client onboarding process can win new clients,” said one head of IT.

DIGITAL 62%

COMBINATION PAPER-BASED

current procedures. Only 14% were satisfied.

38%

10%

20%

30%

40%

50%

60%

70%

The Hong Kong-based COOs and tech heads revealed that they have yet to adopt a fully-digitised onboarding process at their respective institutions. Rather, the private banking community continues to rely on a combination of paper-based and digital methods to onboard clients (62%). More than a third of attendees said that their private banking client onboarding processes were paper-based (38%). One COO added that RMs at his institution must sift through 15-20 documents. The respondents chalked up their hesitancy to a lack of clarity from Hong Kong regulators and said they are more likely to wait for guidance before transitioning onto a fully integrated system.

Are you satisfied with your current onboarding process? DISSATISFIED

What channels do you use for client onboarding? APPS INTERNET PHONE

12%

POSTAL MAIL

24%

FACE-TO-FACE

59%

10%

15%

20%

25%

30%

35%

40%

45%

50%

60%

More than half of respondents (59%) used the face-to-face channel to onboard clients. One Hong Kong-based COO from an American private bank added that given the bank’s focus on the ultra high net worth segment, phone or face-to-face were the most preferred channels. Private banks also continued to use email and post when onboarding clients. The internet or apps are not in use at all, according to the poll.

29%

NEUTRAL VERY SATISIFIED

Another agreed, adding that “compliance scrutiny” is currently peaking making it difficult to trial new systems.

57% 14%

10%

20%

30%

40%

50%

60%

70%

Despite being reluctant to move towards a fully-digitised onboarding process, 29% of respondents said they are dissatisfied with their bank’s

ASIAN PRIVATE BANKER

Source of data: Asian Private Banker and Appway

UB S

ccupying a unique space between UHNW and institutional investors, family offices have a complex set of needs that span the financial and non-financial, and thereby demand from private banks a holistic offering that goes beyond competitive pricing and deal flow. This is where UBS excels. With a long standing presence in Asia and a deep penetration of the region’s UHNW individuals and families, UBS’ dedicated Global Family Office set-up - a joint venture between UBS’ investment bank and wealth management arm - leverages the best of the group to cater to family offices across all stages of their development.

Enrico Mattoli head of global family office Greater China UBS

The Global Family Office provides clients with direct access to over 80 UHNW-focused in-house experts globally - 20 of whom sit in Asia - and a menu of family-specific services covering wealth structuring, governance, philanthropy advisory and next-gen. Furthermore, clients enjoy privileged access to institutional-level trading and execution capabilities, IB strategists and analysts on a one-on-one basis, institutional platforms including prime brokerage in Hong Kong and London and proprietary private deal opportunities via UBS and third parties. UBS has also established itself as a thought leader in the global family office space: its annual surveys remain a benchmark in the industry, while annual global and regional family office summits held in Asia and Europe bring together movers and shakers to engage and share on issues impacting family offices. Anecdotally, too, family offices tell Asian Private Banker that their experience with UBS in 2016 has been nothing short of exemplary; and while this feedback does not directly inform the adjudication process, the fact that the Global Family Office in Asia has achieved positive growth across all key metrics in 2016 speaks to the satisfaction of its clients. “Our Global Family Office is run by experienced senior managers and specialists from across the firm who provide institutionalised coverage to sophisticated family offices,” says Enrico Mattoli, head of global family office Greater China, UBS. “We are dedicated to investing in back to front platform to source, tailor and execute opportunities for our clients. In addition, we also help connect family offices in APAC with their peers across the globe. I would say family office is the most exciting space to be in banking right now!” UBS is Asian Private Banker’s Best Private Bank - Family Office Services for 2016.

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UB S

ew if any private banks can boast a training and development programme that is as comprehensive and considered as what UBS Wealth Management offers its employees.

With an emphasis on ‘experience’ and ‘exposure’ over classroom education, UBS has put in place a rigorous programme that not only caters to the broad requirements of a client advisor, but is flexible enough to permit specialisation and evolution in line with shifts in industry requirements.

Angel Ng head of wealth management training and development Asia Pacific UBS

UBS’ 100-day induction plan is designed to prime new-joiners on the fundamentals of private banking and the UBS offering, culminating in a base certification that is recognised by external bodies in Switzerland, Hong Kong and Singapore. Top performers may go on to pursue a Master in Wealth Management dual-degree in conjunction with the University of Rochester and University of Bern. Of those currently undertaking this programme, over 36% come from the APAC region. Senior talent, including desk heads and county team heads, also receive training on leadership and business execution. Indeed, the LEAD for Country Team Head programme was developed in Asia before being exported to UBS’ other geographies. Furthermore, the 1-year Associate and 2-3 month Client Advisor Assistant (CAA) Cadet programmes have ensured that UBS Wealth Management has a steady pipeline of junior client advisors and CAAs in Asia. A particular point of pride for UBS is its network of campuses spread across three locations: Singapore, Hong Kong and Shanghai. The bank has delivered roughly 1,200 training events attended by 36,530 participants through UBS Business University in the course of a year. UBS Wealth Management is setting up another three in the first half of 2017. The feedback from employees has been resoundingly positive: a 2016 employee survey found that UBS Wealth Management employees in Asia exceed the industry average in terms of their belief that they perform better in their jobs as a direct result of this training. “A strong commitment to training, advanced infrastructure and the expertise of our internal and external faculties have created a structured, effective and sustainable for our WM employees,” says Angel Ng, head of wealth management training and development for Asia Pacific at UBS. “So far, more than 60 senior client advisors have successfully graduated from our Wealth Management Master’s programme. In addition, we are pleased to have our programmes receive various accreditations from both leading global and local organisations.” UBS Wealth Management is Asian Private Banker’s Best Private Bank - Training and Development Programme for 2016.

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Is 60 the new 40? What does that change? Do I have the right plan?

Whenever you reach that next chapter in your life, you’ll want to make the most of it. And keep yourself and your finances in good shape. Although working less has its advantages, it has financial consequences too. We can help create a clear picture of what you need, so that the best is yet to come. For some of life’s questions, you’re not alone. Together we can find an answer.