BNP, Credit Suisse, Morgan Stanley and UBS all want to hire more private bankers in Singapore to service wealthy mainland Chinese clients. And demand for China-coverage bankers in the city state – although still well below that for Chinese investment bankers in Hong Kong – is exacerbating talent shortages in wealth management.
“The majority of private banks in Singapore are now looking to grow their China coverage,” says Gary Lai, managing director, Southeast Asia, at recruiters Charterhouse Partnership in Singapore. “Although Hong Kong is still the dominant offshore centre serving China, some mainland clients don’t feel comfortable putting all their monies there – Singapore is a natural alternative as a leading Asia financial hub with a strong rule of the law.”
The population of high-net-worth individuals, those with more than US$1m in investable assets, in China surged to 758,000 in 2013, up 17.8% from the year before, according to a report by Capgemini and RBC.
Morgan Stanley announced last week that it wants to boost its private banking headcount in Asia by 10% to 20% a year, with much of its hiring focused on its recently opened China desk in Singapore. The US bank is targeting mainland entrepreneurs who have business or family connections in Singapore, Nick Chan, a managing director in Morgan Stanley's HR team, told the Business Times. “They like to be here. Given the strong momentum in our business in the ASEAN region, we expect the growth of our Singapore team to be faster than that of Hong Kong.”
Morgan Stanley, though, faces strong competition for relationship managers (RMs) from other firms that are also expanding their China teams in Singapore. BNP Paribas, Credit Suisse and UBS are the three most aggressive recruiters, says a Singapore-based headhunter who asked to remain anonymous because of client confidentiality. Both Swiss banks manage more private assets and have more relationship managers in Asia than Morgan Stanley, according to new rankings from Asian Private Banker.
While Mandarin is an obvious necessity for China-desk jobs, Singaporean RMs who speak the language but don’t have mainland clients need not apply. Banks want senior RMs who already manage mainland assets, says Lai.
Finding enough of them in Singapore is proving difficult, though. “Not only is there a general shortage of talent in private banking in Singapore, but the pool of people who can serve the China market is small – given that China coverage here isn’t as established or as wide as in Hong Kong,” says Josie Ling, a consultant at search firm Eban in Singapore.
Private banks in Singapore are increasingly having to plug skills gaps by relocating RMs from Hong Kong – and to a lesser extent China, says Lai. “Banks are willing to move them if the candidate is right – if their Chinese high-net-worth clients are willing to book their assets in Singapore,” adds Ling from Eban. “It’s easier for HK bankers because it’s essentially an offshore-to-offshore move. It’s harder from mainland China because bankers would be dealing with changes in platform, products and the manner of doing business – onshore to offshore – and they’d be further away from their clients.”
Private banks in Singapore are also sizing up China-based corporate bankers and investment bankers, whose relationships with mainland business owners would potentially make them effective RMs in the wealth sector, says Lai. Banks such as Credit Suisse, Deutsche Bank, Goldman Sachs, J.P. Morgan, Morgan Stanley and UBS are increasingly integrating their investment banking and private banking operations to encourage more cross-selling of products.