Northern Trust, the 124 year old US-based group that specialises in investment management, asset and fund administration, and fiduciary and banking solutions, is planning an organic build-out of its operations in Asia that will lead to new job opportunities in wealth and asset management, as well as its other core business of asset servicing.
The group has a significant presence in North America and Europe as well, and as of September 30 this year, had US$96 billion in banking assets; $5.2 trillion in assets under custody and $846.2 billion in assets under management serving the needs of corporations, institutions and affluent individuals worldwide.
We spoke to William Mak, Northern Trust's Singapore Country Manager and South East Asia Head about the Nasdaq-listed company's plans for the region, and where the job opportunities will lie.
How long has Northern Trust been in Asia?
We have over 27 years of experience in the APAC servicing clients ranging from government entities, sovereign wealth funds, insurance companies, asset managers, foundations, universities and pension funds. We first started working with clients in Singapore in the mid-1980s, but only opened a fully-fledged office in 1996. In Asia-Pacific specifically, we also have offices in Hong Kong, Beijing, Tokyo, Melbourne and Bangalore. Singapore is the regional head office and regional hub for our asset servicing business. The asset management operation is run out of Hong Kong.
Where does Northern Trust see growth potential?
As a group, Northern Trust has identified Asia as a priority market offering the largest growth potential. But being a conservatively run company with a mid-West culture (the global head office is in Chicago), our expansion is organic and measured, and any move we make into new markets is very strategic. This, and the fact that we have never been involved in risky investments is why we have a strong, stable credit rating. The last thing we want is for our clients to worry about us.
Which business areas are you expanding?
We are developing plans to launch a private wealth operation in Asia in 2014. The plan is to leverage our existing asset servicing and asset management businesses. It will not be the typical concierge, bricks and mortar offering, but it will target private investors and family offices. There is a lot of potential in the family office space, especially in China, where the concept is not yet commonly accepted.
In terms of our institutional business, we are moving into new markets and deepening our presence in others to capitalise on increasing cross-border investment flows, particularly in countries, such as China, where the economies are expanding internationally thanks to government-led liberalisation and deregulation. Outside of China, we will be guided by the accumulation of wealth in regional economies, so the recent news about the increase in the number of sovereign wealth funds in Asia highlights our sweet spot. Given this, we continue to look at Malaysia, Brunei, Thailand, Philippines, South Korea, Japan, Cambodia and Taiwan.
What about your plans for Singapore?
Singapore is our largest business in the region, outside of Bangalore. With a staff size of around 160 that has been growing at 10% to 15% per year, we have a very strong franchise with the country's sovereign wealth funds and government agencies. But competition is keen, so we are continually looking at innovating and creating new products and services.
We are putting more emphasis on servicing asset managers, especially those who want to outsource their back office functions. We'll invest in additional headcount as the business grows, with a focus on niche and specialist positions rather than entry level roles.