Guy Mills, Manulife International
The firm believes digital advice will play an important role for its existing clients globally, including asset management and insurance customers, according to Guy Mills, Hong Kong-based CEO at Manulife International.
“Our asset and wealth management businesses in the US and Canada have been experimenting with this quite some time and we adopted some of their successful ideas in the Hong Kong market,” Mills said at a recent media briefing in Hong Kong.
Mills believes that a robo-advisory platform will help the firm’s clients with their asset allocation and fund selection, regardless of whether they are mutual funds, pension products or an investment-linked assurance scheme.
“We do see an important role for using the technology that robo-advisors are using.”
Manulife officials believe that a robo-advisory service offering would have traction due to the firm’s large client base. The group has an estimated 26 million customers and had $829.4bn in asset under management and administration globally as of the end of December, according to a statement from the firm.
In Hong Kong, the group has 2.2 million customers and had HK$391bn ($49.8bn) in asset under management and administration as of the end of June, according to Mills. The firm’s customer size in Hong Kong is roughly 30% of the SAR’s population of 7.3 million.
Dominic Gamble, Singapore-based chief digital officer at fintech firm Privé Technologies, believes that huge financial firms, such as banks, are well positioned to offer robo-advisory services due mainly to the fact that they have a large existing client base already.
“The opportunity is to shift a lot of deposit, credit card or mortgage holders to a more digitised investment service,” he said in a recent FSA interview.
Other huge financial firms in Asia are also looking at launching robo-advisory services to their clients.
For example, Standard Chartered Bank is exploring ways to integrate artificial intelligence into its business, one of which is robo-advisory, Peter Clark, regional chief information officer for Greater China and North Asia, said previously.
Hong Kong-based brokerage firm Convoy Investment Services (CIS) signed up with robo-advisory service firm Aqumon last year.
Separately, Hong Kong IFA Convoy, which is a different entity from CIS, also became the largest shareholder of UK-based robo-advisory firm Nutmeg after a £24m ($31.22m) investment in 2016, according to a statement from the firm.
However, there is no update on Convoy’s plans to launch a robo-advisory platform in Hong Kong.
Singapore-based OCBC recently launched a robo-advisory platform and claims to be the first bank in Southeast Asia to launch such as service.
Not for HNWIs
Privé’s Gamble noted that robo-advisory services may not appeal to ultra high net worth clients. Gamble believes that the client segments would prefer to maintain their face-to-face relationship with their advisor as the advice they ask for is more complex compared to premier banking clients.
The case has been proven to be true for UBS, which recently shut down Smartwealth, its robo-advisory platform in the UK, less than 18 months after launch, as reported by FSA sister publication Portfolio Adviser.
Heather Hopkins, founding and managing director of Nextwealth, told PA that robo advice is a difficult sell for UBS high net worth clients.