Francis Koh, professor of the Finance Practice, and director, MSc in Wealth Management, at Singapore Management University, talks exclusively to Hubbis about his outlook for Asia’s wealth management industry, and the role of Singapore as a regional hub.
Date: Jan 20, 2012
How do you see Asia’s wealth management and private banking industry evolving given the growing competition in the region?
There is likely to be a focus on consolidation and some more strategic alliances in Asia, such as the one recently between Julius Baer and Macquarie.
This can provide scale, which in turn can help firms provide more efficiency and have the resources to ensure a better client experience and more training for staff.
Larger organisations tend to have better cost-income ratios and therefore more resources to train their staff and engage clients more frequently through events and other ways.
Do enough young people have the attributes to be successful in Asian wealth managers?
It requires a lengthy period for young bankers learning from their seniors to be groomed as wealth managers. This requires training in knowledge, skills and the right attitude to provide appropriate services.
For example, at SMU we always encourage younger students to do internships to ensure they have exposure to the industry before they enter the business – and they must be clear about why they like the industry.
What role will Singapore play as a regional private banking hub as Asia’s wealth management markets continue to grow?
Although Singapore has the highest per capita number of millionaires, there is a limit to the domestic market.
As a result, it should be a hub for wealth management and private banking services – for example, the place to set up trust structures and do trust administration, or be the location where asset managers and hedge funds are located, or where there is arbitration and mediation.
Singapore is not just a booking centre, but rather a centre where assets are managed and professional services are provided.
We believe that we can develop the right talent pool against the backdrop of a well-endowed infrastructure and regulatory framework to encourage the growth of this business.
Why is Singapore well-positioned in this way?
The fact that Singapore has a relatively short history of wealth management and private banking – in comparison to Switzerland, for example – means that it has few legacy issues, creating a platform for quicker growth.
At the same time, Singapore’s political system allows it to be more decisive and focused in being able to pursue specific initiatives in wealth management.