A Deepening Commitment

Marking the launch of their new global private banking business in the UAE, Annabel Spring CEO, Global Private Banking and Wealth, HSBC talks with MEA Finance about how this sector of the market is changing why this region stands out to her in today’s world

In the two years since becoming Chief Executive, Global Private Banking and Wealth, how frequently has this region come to your attention?

We have a long-standing presence in the UAE for over 76 years and in the last several decades of visiting the country, I have personally witnessed its tremendous pace of progress. It stands out in a tough global economy with a predicted 5% growth rate in the next year despite global market and economic volatility.

The region has always been a strategically important growth market for HSBC Global Private Banking with a pivotal position as a key gateway to emerging wealth pools across the region and a growing international community. With the launch of our new HSBC Bank Middle East Global Private Banking here

we are ready to cater to a fast-growing HNW investor base that wants to hold assets in the country, while retaining the flexibility to structure portfolios across key international financial hubs.

We have continuously invested in the Middle East especially in the UAE, both in Dubai international Financial Centre (DIFC) and Abu Dhabi Global Markets (ADGM), as well as Saudi Arabia and Qatar. We are also building on our private banking services in Egypt, Kuwait and Bahrain, as well as in geographies that align to the unique needs of UAE expats (e.g., onshore India).

The current economic backdrop is challenging. What’s your strategy to combat that and has that changed?

Despite global headwinds, the strong positive growth in the region is, at least in part, due to well-managed Covid protocols attracting an influx of high-networth individuals from across the globe. In the UAE, progressive government policies and actions across a range of social and economic areas have also made the country a large recipient of investment, technology and talent from across the globe, as well of course as commodity prices.

Outside the Middle East the picture is more challenging. As such, we are advocating a focus on quality, income and diversification, though always with an eye out for opportunities as these are interesting times where protection of wealth is important as is making the most of the opportunities.

We continue to support our clients through volatility, helping them understand complex global geopolitical dynamics and how best to navigate their investments while keeping their long-term goals on track.

Clients’ needs are changing and there are more different types of investors than ever before. How are you catering to their needs?

Our wealthy clients are looking for a fluid experience of local advice and global diversification opportunities, an alignment between personal and business needs, a focus on both traditional and innovative asset classes and have varied service preferences.

UAE clients stand out due to the entrepreneurial spirit of this region, with many family-owned businesses expanding both locally and internationally. This is one of our key competitive strengths: with our history in the region and HSBC’s global reach we have expertise to serve them personally and their businesses both here and abroad – whether that’s Singapore, Hong Kong, the UK or the US, India or Bangladesh.

In terms of investment opportunities, clients are increasingly interested in a wider range of asset classes. Whether its interesting ideas in the alternatives space or new ESG funds, we are continually innovating. The digital assets space

Annabel Spring, CEO, Global Private Banking and Wealth, HSBC

DIGITAL TRANSFORMATION HAS ALLOWED US TO MOVE THE BANK TO AN INTERACTIVE MODEL OF CLIENT ENGAGEMENT THAT ALLOWS US TO FACILITATE THEIR NEEDS, WHEREVER THEY ARE IN THE WORLD

(including NFTs) is also gaining interest: we are exploring it while balancing innovation with a prudent management approach. Of course, our offering spans beyond investments – for instance, we have an exclusive Insurance partnership with Zurich International offering a wide range of protection and investment linked insurance solutions.

The wealth service model is also evolving. While the industry is increasingly focused on the convenience of digital capabilities, client preferences remain deeply personal. Many want to interact with us in an entirely digital way that is customisable to their needs, others value the deeply personal connection that can only be delivered by a relationship manager. For many, a winning offering combines the best of both worlds with balance changing over time. Locally, we now offer a range of online trading capabilities for equities and ETFs across multiple markets with real time pricing, as well as bonds and a wide range of international funds.

As a result, we see less regional distinction and more variability in personal views, as clients need help aligning their specific financial goals with their personal sustainability objectives. We achieve this with both internal and bestin-class third party product partnerships to offer a full-spectrum of sustainable investment solutions: from innovative discretionary portfolios and alternatives to structured products, equities and bonds. Some of our GCC clients are also exploring sustainable philanthropy which is very encouraging.

Do ESG considerations factor into regional HNWI’s investing decisions to a lesser or greater extent than in the rest of the world?

Investment strategies incorporating ESG account for over 25% of professionally managed assets globally – integrating

ESG into mainstream financial analysis is also well in train. Adoption of ESG investing will grow at an accelerated rate driven by asset owners, risk mitigation and return objectives. By now, ESG is not a new topic for most investors.

What are the challenges around recruiting wealth and relationship managers in the region?

Our business is anchored in building trust and long-standing relationships, and we invest heavily into attracting, developing and retaining the best talent. In an increasingly competitive hiring environment, we focus on what makes HSBC a unique place to work and a fantastic long term career opportunity.

We attract individuals who want to work for an international bank with a deep heritage in the region that offers career opportunities both locally and globally. We invest in our people and their expertise. What differentiates us is not only the sophistication of our wealth products, but also access to the Group’s international

network and a strong personal and wholesale banking franchise.

Of course, competitive compensation and benefit packages are also critical. But it’s not just about the numbers—we are focused on culture of diversity and

IN TERMS OF INVESTMENT OPPORTUNITIES, CLIENTS ARE INCREASINGLY INTERESTED IN A WIDER RANGE OF ASSET CLASSES

collaboration ensuring our employee base reflects the multi-cultural spirit of the UAE and our diverse client base.

What are your thoughts on the future prospects for the private banking market in the MENAT nations?

The growth of the region means it is an exciting market for private banking. Innovation and vibrant entrepreneurship create a strong demand for world-class wealth management as millionaire households continue to grow.

With its investment-friendly policies, evolving succession laws for expats, recognised financial centre status and the availability of world-class banking talent, the UAE has established itself as a prominent private banking hub of global relevance.

For HSBC, the UAE is a critical global hub where our clients around the world increasingly want to hold part of their financial and real estate wealth. Our new HSBC Bank Middle East Global Private Banking will add a new dimension to our existing presence in DIFC and ADGM and enable us to provide clients with both onshore and offshore services.

All of our UAE clients have a dedicated Relationship Manager locally to ensure products and advice align to the evolving needs throughout their lifetime and can be a single point of access to connect with expert teams in other geographies. We also offer access to international wealth and trust specialists who help implement solutions to manage clients’ legacy across generations.

Is technology playing a bigger role in, or changing the ways that you interact with your private banking clients?

The ways in which we interact with clients are constantly evolving to provide a faster and more seamless experience with a wider range of journeys and products. Private Banking remains a high touch client segment, but technology is now providing us with better ways

to make personalised interaction more efficient and aligned to clients’ preferences. Generational change and digital adoption have made it a necessity in financial services to develop and deliver options to clients on how they can interact with us within an omni-channel engagement model.

Private banking clients have complex needs and are geographically mobile— creating digital platforms to support them is essential at HSBC. Digital transformation has allowed us to move the bank to an interactive model of client engagement that allows us to facilitate their needs, wherever they are in the world. I do think, for all businesses, the pandemic has helped accelerate this trend as intuitive digitally enabled communications have become a core component of day-to-day engagement.

Technology has also facilitated our ability to move beyond servicing our clients with traditional wealth management products towards an ongoing strategic partnership. We can deliver deep portfolio analytics and insights and use our expertise to provide them with more impactful strategic advice than ever before using real-time data. Clients are now more tech-savvy and connected than ever before. Social and mobile tools mean the world is at their fingertips and we have to not only keep up but act with urgency in their best interest based on ongoing inflow of information. It also enables timeliness and consistency of engagement in response to market movements, changes in personal or business circumstances and needs, etc.

IN THE UAE, IN ADDITION TO INTERNATIONAL INVESTMENTS, MORE CLIENTS ARE INCREASINGLY HOLDING THEIR FINANCIAL AND REAL ESTATE ASSETS IN THE COUNTRY, AND WE EXPECT THE NATURAL NEXT STEP IS THAT WE SEE MORE ESTABLISHED FAMILY OFFICES HERE

What would you say are the topmost benefits of the services that HSBC can provide to HNWI’s in the region?

HSBC is the largest international bank in Middle East, North Africa and Turkey (MENAT), with a presence in nine countries across the region: Algeria, Bahrain, Egypt, Kuwait, Oman, Qatar, Saudi Arabia, Turkey and the United Arab Emirates.

We believe that our personal and business banking presence around the world makes us unique. Our purpose is to look after our clients and their family and business needs globally, whether it be in banking or investments. Due to our scale and expertise, we can bring the world’s opportunities to our clients and help them manage global risks while we help them protect their wealth and plan for their family’s future and legacy.

In the UAE, in addition to international investments, more clients are increasingly holding their financial and real estate assets in the country, and we expect the natural next step is that we see more established Family Offices here. As that shift accelerates, together with our new HSBC Middle East Global Private Banking, and our existing award-winning operations in the Dubai International Financial Centre (DIFC) and the Abu Dhabi Global Market (ADGM), we are ready to offer the best of onshore and offshore services to meet their needs.