More next generation private bankers in Hong Kong and Singapore recruited locally

05 February 2021 | INDUSTRY
The tide is turning for a new generation of PB relationship managers in Asia’s twin financial hubs, with talent being recruited locally in significantly larger numbers than a decade ago.
A decade ago — when the industry was on the cusp of rapid expansion — quite a number of private bankers were hired from other parts of the financial services industry to meet larger families’ demand for PB services. Many of the more seasoned bankers came from Europe or the US, where the industry was more mature, observed Sujan Melwani, managing partner, DMO Group. “Back then, importing international talent was key to growing the Asia team,” he explained.
Preponderance of local talent
Between 2015-2019, the region’s top 20 private banks by AUM had on average maintained a double-digit CAGR, according to Asian Private Banker‘s data, while billionaire wealth in Hong Kong alone has more than doubled in the last decade, according to UBS.
As such, importing international talent no longer suffices and it has become imperative for the region to have a local supply of PB talent.
What sets the older and younger generations of private bankers apart is that among the new generations, more localisation is taking place, opined Peter Stein, managing director, the Private Wealth Management Association (PWMA) of Hong Kong. More private bankers are being locally recruited rater than imported from Europe or the US.
Since 2017, PWMA has launched an apprenticeship programme targeting university students in Hong Kong, in a bid to prepare them for a career in PB. The number of applicants has increased each year from the initial 368 to 1,235, while the annual intake stabilises between around 30-50 candidates.
Historical PWMA data show that among the participants, 97% are high in their proficiency in Mandarin Chinese, and 96% have a background in finance or business-related disciplines. The male/female ratio is evenly split (52% versus 48%).
“In the next five, ten years, we will certainly see a new generation of younger private bankers coming to the fore who are from Hong Kong, Greater China or the region,” observed Stein.
He added that “with a large percentage of new PB clients coming from mainland China, Mandarin is considered essential by the vast majority of banks” as private banks hunt for young, local talent in the region. For more experienced talent, this does not necessarily apply, but bankers with China ties are increasingly sought after, according to Robert Walters.
However, by no means does this mean that the region will see international talent retracting to their home markets. Stein believes there will be room for “a fair amount of exchange between the regional market and the rest of the world”.
However, by no means does this mean that the region will see international talent retracting to their home markets. Stein believes there will be room for “a fair amount of exchange between the regional market and the rest of the world”.
According to Stein, such exchange will be mutual: “There are private bankers who ended up moving to Europe, partly because there are clients who want to book in those centres. On the other hand, there are clients in Hong Kong or the region who want to interact with bankers who are familiar with the European environment and appreciate working with European or American bankers.”
“But there will certainly be a preponderance of local talent in the market here versus imported talent,” he pointed out.
Nevertheless, private banks will increasingly prioritise international talent who bring in assets for the bank, versus a management role when making hires for their regional business. Melwani said he has seen a fair number of expat private bankers going home, whether for personal or work-related reasons. “But those with good books of business and client relationships are still here, many serving management roles.”
Serving next-gen wealth
Rahul Chawla, head of wealth management, Asia and head of financial institutions, Southeast Asia at Aon, told Asian Private Banker that two factors are playing into the demographic shift of private bankers in Asia.
“First, team leaders and senior RMs are grooming the next generations of RMs, who are typically “home-bred”. Secondly, with immense wealth in Asia to be transferred to next-gens, this client segment demands RMs who are culturally in tune and are have an acceptable level of ‘digital quotient’.”
While digital literacy is widely expected, Stein emphasised that this does not mean the banker has to be proficient in technology. “[They] need to be comfortable with the technology at the bank and what the clients are using. So there may be a bias towards talent that is more digitally native.”
Stein noted that the changes in private bankers’ demographics mirror the changes in client profiles and market trends. “For instance, we see more clients from the rising class of wealthy entrepreneurs, who have different profiles from the established wealthy families who accumulated their wealth in the 1980s, 1990s, and early 2000s.”
The bottom line is that private bankers, young or experienced, need to have a fine balance between their emotional intelligence and investment intelligence, said Chawla. He believes that banks need “an RM who can connect with the client, develop a deep understanding of client needs and service them with the support of product and investment specialists”, in lieu of an RM who has an expertise on all of the client’s needs.
[The next generation of private bankers], Stein concluded, “is going to be quite evenly split between men and women, and these people are going to be digital natives who will be comfortable with newer technologies.”
This interview was first published in the Asian Private Banker on February 5, 2021. The original article can be found here.

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