Banks expect to double customer assets.
If growth in assets under management is an appropriate measure, private banking and wealth management in the Asia-Pacific region are in the best of health. The average content from various data providers suggests that assets under management in the region grew by $400 billion in 2023 after two years of contraction.
Consulting firm Accenture recently reported that Asian wealth management firms aim to double their assets under management to $260 trillion by 2026. At the current pace, this is becoming more achievable.
However, the regional industry struggles with how its companies differentiate themselves. Most of them offer well-designed customer interfaces, AI-powered portfolio management, and big data analysis. They also provide product access to liquid public markets, from global fixed income and equities to mutual funds and exchange-traded funds.
Innovative digital superiority and global banking heft will determine which bank wins the race for exclusivity. Winners also get access to premium research, special deals and a gold-plated talent seat in the front office.
Best Private Bank: DBS Private Bank
DBS Private Bank’s relationship management team has an excellent reputation, underpinned by its ‘one bank’ business model where the front office can draw on a myriad of global bank capabilities, not least its research capacity and the bank’s ‘physical’ approach to bringing together digital transactions. With face-to-face interaction.
The data points are impressive: assets under management grew at a CAGR of 10% from 2017 to 2023; The private bank has a meager cost-to-income ratio of 43% versus the industry average of 60% to 80%; Total wealth management income rose 35% last year, supported by an inflow of net new funds worth S$24 billion (about $18 billion).
DBS has made extraordinary strides as a financial institution over the past decade. If Asian growth dynamism makes ASEAN the world’s fourth-largest economic bloc by 2030 – after the United States, Europe, and North Asia – as widely expected, the bank’s seemingly relentless march will not abate.
Best Private Bank for Sustainable Investment: Private Bank of Singapore
Bank of Singapore (BoS), a Singapore-based subsidiary of OCBC, can leverage the group’s approach to sustainability and environmental, social and governance (ESG) concerns to its advantage.
OCBC has invested S$30 million since 2021 to launch a range of sustainability training modules. That year, Bank of Sudan was the first private bank in Asia to add ESG factors to assessments of loan amounts and focus on MSCI-rated funds with ESG scores of AA and above.
In 2022, the Bank of Singapore co-chaired a task force for the Association of Banks in Singapore to issue the city-state’s first sustainable investment guidelines. Last year, it was the first private bank in Singapore to sign up to the Singapore Stewardship Principles for Responsible Investors.
Bank of Sudan is implementing a set of ESG assessment tools that will add a sustainable dimension to clients’ investment portfolios through ESG assessments and results. This will enable the bank’s front office to evaluate its ESG performance data based on MSCI’s ESG ratings.
Best Private Bank Digital Solutions for Clients: ICICI Securities
The bank describes itself as a “digitally-led, knowledge-based financial services company.” ICICI Securities offers multiple delivery channels, including its app and website, ICICI Direct digital investment platform, digital assistance, equity relationship manager, wealth manager and independent financial partners.
ICICI has created a ‘data lake’ and is analyzing the data through multiple analytical tools. The use of execution algorithms allows orders to be segmented and averaged within an integrated digital platform with an open architecture. Tools include a watchlist, chart-based trading system, dashboards, and heatmap insights.
Last year, the bank moved a standalone portion of its trading platform to the cloud to gain the bandwidth and scalability needed to expand the business, leverage the capacity of Amazon Web Services, and ensure data remains in India as per regulatory requirements.
“We aimed to move much faster – scaling and adapting quickly to develop new digital services… to execute thousands of trades in seconds,” says Subhash Kelkar, former chief technology and chief digital officer at ICICI Securities in Mumbai.
