Private Banking in Asia - A Survey

12 Pages Posted: 31 Aug 2009 Last revised: 24 Nov 2009

See all articles by Gunter Dufey

Gunter Dufey

Stephen M. Ross School of Business at the University of Michigan ; Nanyang Technological University (NTU) - Centre for Research in Financial Services (CREFS)

Date Written: August 28, 2009

Abstract

This survey focuses on some unique aspects of private banking and wealth management in Asia. There are a number of unique features that distinguish private banking in Asia from that business in the rest of the world. First, Asian banking tends to be more “trans-border” by nature, that is, the origin of the assets and the administration reside in different jurisdictions. Second, a disproportionately large share of clients are active entrepreneurs of the first or second generation, who are often members of minority groups in their economies. Furthermore, and third, among the service providers, there is keen competition among European based banks, North American banks and brokerages as well as domestic institutions in Hong Kong and Singapore; yet there is little evidence of consolidation and the market remains highly fragmented. Fourth are the notable differences in asset compositions of investment portfolios as well as the predominance of females among the important relationship manager population in Asia.

As to any lasting effects of the financial crisis of 2008/09 on the private banking business in Asia, hard facts have yet to emerge. The fiscal problems of major and minor countries in the world have prompted a renewed push for lessening bank secrecy, not only in cases of criminal activity but also ‘ordinary’ tax avoidance. Offshore jurisdictions around the world are under pressure to provide information to foreign fiscal authorities. As to products and services, it is likely that there will be less emphasis on complex structured products, more focus on credit worthiness of the institutions offering private banking services, and, in general, less competition in terms of innovative products due to the demise of the American investment banks in global markets. However, economic growth rates in the region, in combination with high savings rates, will make Asia an area of alluring opportunity for financial institutions offering competitive private banking and wealth management services.

Keywords: Private Banking, Wealth management

JEL Classification: D31, E44, G15, L14, L84, N25

Suggested Citation

Dufey, Gunter, Private Banking in Asia - A Survey (August 28, 2009). 22nd Australasian Finance and Banking Conference 2009. Available at SSRN: https://ssrn.com/abstract=1463261 or http://dx.doi.org/10.2139/ssrn.1463261

Gunter Dufey (Contact Author)

Stephen M. Ross School of Business at the University of Michigan ( email )

701 Tappan Street
CSIB
Ann Arbor, MI 48109-1234
United States
650-249-3483 (Fax)

Nanyang Technological University (NTU) - Centre for Research in Financial Services (CREFS)

Nanyang Avenue
Banking and Finance
Singapore 639798
Singapore

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