DBS Private Bank plans to increase its headcount of relationship managers by 20% by the end of 2018 as client demand for its services surges, says one of its most senior bankers. The division currently employs about 200 RMs, mainly based in Singapore, so the rise would mean adding approximately 40 bankers.
“But this isn’t a hiring spree,” says Joseph Poon, regional head of Southeast Asia at DBS Private Bank. Unusually for the Asian private banking sector – which is renowned for rampant poaching – only about half of the new RMs will come from other banks. The rest will be developed from within the firm.
Like many of its rivals, DBS wants additional bankers to capture clients from Asia’s growing population of millionaires and billionaires. Other factors are also fuelling the expansion. “There’s huge pent-up demand for succession planning as client assets move to the next generation, particularly in Asia,” says Poon. “It’s a complex issue because business and financial assets are often spread across countries.”
DBS also needs to grow its RM workforce as new clients come on board following the exit of several private banks from Asia, says Poon. Over the past two years, for example, Barclays has sold its Asian operations to Bank of Singapore, while UBP has taken over Coutts’ business in the region.
Poon says more stringent regulatory standards are increasingly making it administratively burdensome for wealthy people in Asia to use multiple banks. “Clients are joining us because as they rationalise their banking, they want access to our universal banking platform – from credit cards to IBD – all under one roof.”
While DBS may be on the right side of many trends in Asian wealth management, there’s one that it can’t overcome: the region’s tight supply of RMs. “Skill shortages are chronic, and the job market won’t satisfy all the new talent we need,” says Poon. “So, we’re developing RMs internally.”
There are three main ways that DBS hires internally for RMs roles in its private bank. Most obviously, it grooms qualified assistant bankers into fully-fledged RMs. It also promotes RMs from its mass-affluent Treasures Private Client business. “Thirdly, we make selective internal transfers – from investment banking, corporate banking, and support services, for example – and we train these staff to become RMs,” says Poon.
New skills needed
Neither internal nor external hires are expected to be “merely experts at products” because DBS’s investment specialists already have those skills, says Poon. Instead, RMs need to “connect the dots” for each client – for example they must know how to manage the return, risk and liquidity profiles of their assets across geographies and changing markets. “Clients are becoming more interested in receiving longer-time-horizon investment advice about overall portfolio performance, rather than what investments they ought to buy in the short term,” he adds.
This helps explain why Poon doesn’t think technology poses a threat to private banking jobs. But he adds that RMs shouldn’t “resist or ignore technology” because it ultimately helps their clients. DBS’s iwealth app, for example, allows clients to do their own day-to-day trading. “This means when RMs speak to clients, the conversation now revolves around strategic issues such as long-term investment outcomes, wealth objectives and succession planning,” says Poon.
Private bankers can no longer be “singularly focused on just on their clients’ financial investments”, he adds. “Many of our clients are entrepreneurs. Our RMs are trained to help them identify broader opportunities for their businesses and connect them to experts in investment and corporate banking.”
Poon joined DBS in 2016, having been head of UBS’s ultra-high-net-worth and global family office businesses for Southeast Asia. He’s also held senior jobs at Julius Baer, Macquarie and J.P. Morgan.
DBS recently ranked fourth – ahead of global brands such as HSBC and Morgan Stanley – among Asian respondents in the eFinancialCareers Ideal Employer survey, which asked about 2,000 finance professionals in the region to vote on their preferred employers. “Ten to fifteen years ago, a move from a foreign private bank to DBS private bank may not have been perceived as an upgrade. It certainly is now. We have a healthy mix of home-grown talent and staff who’ve previously worked for global private banks.”
The “financial performance/strength of the firm” was cited as a key strength of DBS by 72% of those who voted for it as an ideal employer. “DBS is a stable, Asia-centric bank. Our RMs don’t worry about us retreating from Asian private banking,” says Poon.
Poon moved to DBS after working for foreign banks for 23 years. “In my previous roles, I often felt the right to manage a private banking client’s wealth had not been fully earned, in that we weren’t there when they needed help to finance their first home or get their business up and running,” he says. “It’s different at DBS because many clients already had a relationship with us long before they needed private banking services.”
Some of Poon’s preconceptions about DBS have been dispelled since he came on board. “I was pleasantly surprised by how sophisticated DBS’s platform is. Our technology and digital capabilities are also more advanced than at other banks I’ve been with. The working style at DBS is less bureaucratic, and I’m pleased to be based at DBS’s headquarters, where strategic decisions can be taken and implemented quickly.”