“Private banks in Hong Kong have been growing very quickly, and more smaller boutique private banks have been coming to Hong Kong in the last few years,” said Joseph Chan, director of the HKSFA and managing director in financial markets at Standard Chartered.
“At the same time, growth of wealth management is included in the broader policy strategy of the Hong Kong government.”
The government recently said it will provide HK$100m ($12.9m) for a three-year pilot scheme for insurance and asset and wealth management services.
Chan said the need for offshore wealth management services is evident, especially from high net worth individuals in mainland China, who often prefer Hong Kong as an offshore private banking center.
In Hong Kong, China and Taiwan combined, assets held by HNWIs were $5trn, he said, citing figures for full year 2013 from a CapGemini report.
The figure represents annual HNWI asset growth of about 12% in Hong Kong, 20.5% in China and 19.5% in Taiwan.
The result is a huge demand for experienced professionals to serve in the wealth management industry.
Asia lacks experience
But Hong Kong’s non-senior private bankers tend to be less experienced than their counterparts in developed markets, said Anand Batepati, a partner at Global Financial Markets Group.
Asian wealth managers tend to lack the depth of product knowledge or the ability to provide critical analysis of product on the same level as their European counterparts.
One reason is the difference in objectives. Batepati pointed out that in Switzerland, a private banker manages family money for the next few generations. In Asia, the private banker is more likely tasked with turning $1m into $2m.
“Asia is new money often from self-made entrepreneurs and private banking is more about increasing wealth.”
The increased need for training has prompted the HKSFA to run workshops the week of March 16 for non-senior private bankers and anyone involved in bespoke wealth management.
