As demand for financial planners across the industry continues to increase, banks need adaptable policies to respond to changing industry trends and customer requirements.
When it comes to financial planning, John Lam, executive director, Dah Sing Bank Limited, and director, Dah Sing Life Assurance Company Limited, stresses the importance of the market segment occupied by banks.
"Until recently, the mass market and the private banking sector for high net-worth individuals have been the most distinctive segments of the wealth management market in Hong Kong," says Mr Lam. "But the sector consisting of emerging affluent clients with net assets of between HK$500,000 and HK$1 million is growing, with greater demand for wealth management services," he adds.
While each sector is dynamic in its own right, the affluent segment is enjoying faster growth, as wealthy individuals have become more aware of the importance of financial planning in accumulating wealth, says Mr Lam. "Twenty per cent of affluent customers make up 50 per cent in our retail banking income," he remarks.
In order to cater to clients' different needs and investment objectives, there is a wide range of products in place in the various sectors, says Mr Lam. These include unit trusts provided by 28 different fund houses, currency-linked, interest rate-linked and equity-linked structured products and principle-protected products.
"It is important that appropriate products are sold to clients in the mass market, based on their financial needs and the risk levels involved," Mr Lam notes. "On the other hand, financial planners must also carefully consider the goals and aspirations of their affluent customers, as these can differ vastly between clients in their late twenties and those in their early forties."
Mr Lam also points out that clients approaching retirement age tend to prefer a wealth-preservation plan offering decent returns. "However, we must strictly follow compliance issues when we sell products, including risk-tolerance assessments of every client," he says.
In terms of private banking, customers require a superior level of service. "They expect market updates and news in addition to in-depth portfolio analysis and product exposure," Mr Lam states.
Frontline financial planners require assistance from, and coordination by, sales support staff and the production development team, he emphasises.
With different targets across the different segments, recruitment requirements for financial planners are varied, says Mr Lam. "In general, our financial planners must have sales licences. Relationship managers receive further financial planning training. At senior level, some already possess professional qualifications."
The job is demanding by nature and the necessary academic qualifications are essential for candidates wanting to enter the field. "We are constantly recruiting more staff to cope with our expanding business," Mr Lam notes.
Continuous learning is crucial for financial planners to equip themselves to cope within the changing industry, says Mr Lam. "Some staff members are working towards their licences, while others are keen to enroll in financial planning programmes. The bank actively sponsors senior staff to obtain higher qualifications."
He points out that prospective financial planners should enjoy gathering information about the latest products and market trends, adding that it inspires trust in clients when they notice that their planner is well prepared.
There are good prospects for promotion and moving up the career ladder in the industry, points out Mr Lam. "A junior sales person who has accumulated a few years of practical experience, product knowledge, sales skills and qualifications can quickly become a financial planning manager, and even progress to private banker within 10 years," he notes.
"In addition to basic salary and annual bonuses, we offer a number of sales incentives, including special monthly sales awards, to foster staff morale," he says, adding that such monetary awards can top up employees' overall incomes.
There has been a huge demand for China-related wealth management products and it is expected that future demand will grow even bigger in the light of strong economic growth on the mainland and a favorable policy towards China's capital market. "Fortunately, the booming Chinese economy supports the further development of Hong Kong's financial industry, which ultimately benefits the financial planning business," Mr Lam says.
Experience is ultimately crucial for establishing a career in financial planning, and it is particularly important to keep abreast of current affairs such as a possible trade disputes between nations, GDP influences, foreign exchange speculation, inflation issues and environmental protection penalties.
"By getting to know the products and being aware of market news, financial planners can guide customers and win their trust and confidence. In return, they will be rewarded with a flourishing career," Mr Lam concludes.