Financial Planning / Wealth Management

Business class wealth management service

by Anna Tong

Lina Cheng, vice president, head of the Financial Advisory Services, American Express Bank
Photo: Edde Ngan

Bank's philosophy is not to push products or use churn tactics

Out of the four pillars of the financial industry; deposits can be expected to grow rapidly in the coming years, particularly in insurance and investment. To respond to this growing trend, American Express Bank (AEB) decided to enter the financial advisory services industry two years ago as part of its global wealth management services.

AEB's global wealth management consists of two main businesses, private banking and financial advisory services (FAS). Private Banking serves high net worth individuals bringing in more than US$1 million in investments while FAS serves customers with investments of US$100,000 or above.

Lina Cheng, the bank's vice president and head of Financial Advisory Services, finds that people in Asia tend to put 50 to 60 per cent of their assets in time deposits or savings, thereby confirming the need for investment services such as FAS. Drawing on her 20 years' experience in various financial institutions, she anticipates the financial advisory industry will grow very fast in Hong Kong.

"Of Hong Kong's population of about seven million, approximately 1.4 million local residents have accumulated assets of about US$100,000, so the business potential for this group as a whole is quite enormous," she says.

Business class services

Mrs Cheng explains that AEB is the only institution providing a "business class" wealth management service. In the market, there are many high-end retail financial services for the mass affluent and private banking services for high net worth individuals.

"In FAS, we have relationship managers (RM) and investment consultants to provide time proven asset allocation model to help diversify investment portfolios to build, generate and protect their wealth. We do not focus on providing a transaction service with the exception of some complimentary transaction services for the convenience of our existing clients," she points out. But, unlike some other institutions, AEB does not push customers, force products on them or use churn tactics.

Every client is serviced by their individual relationship manager who carries out a risk profiling to ascertain risk appetite, investment experience and preference of a customer before recommending a tailored asset allocation distribution scheme.

The range of products includes mutual funds, structured notes and treasury deposits, all protected structured deposits with an underlying equity link. For clients with conservative appetite who aim for safe yet profitable havens for their assets, they can opt to put them into the money market for capital protected structured notes or a super saving scheme.

In AEB, clients are the ones who make the final decision on the RM's recommendation. But such recommendations are based on experience and a close watch on current financial trends.

As Mrs Cheng says, "You need a specialist to advise you on how best to invest your money, and for foreign markets you need someone with lots of experience as different markets perform differently."

AEB draws on the expertise of widely experienced economists and investment consultants in its offices worldwide and sources the best products, ranging from in-house products through products from renowned international fund houses which fit clients' appetite and risk level.

Work from the heart

Mrs Cheng believes that such international experience and presence, together with AEB's philosophy and corporate culture, is what gives AEB an edge over rival financial institutions. "We aim for long-term relationship with clients, that is why we work from the heart, and we hope our customers feel that," she says.

The bank is choosy when it comes to recruiting staff who will be responsible for managing valuable portfolios. It favours applicants from the investment or insurance industry who have at least seven to eight years' banking experience with two to three years servicing affluent customers; or talented RMs from other major companies with at least two years' background. Incoming RMs receive comprehensive training so their values line up both with AEB's philosophy and its products.

Mrs Cheng adds that AEB has a friendly atmosphere with an emphasis on teamwork, making it a desirable place to work. In addition, its RMs embark on a fruitful career with lots of opportunities for promotion, where virtually "the sky's the limit".

Graduate opportunities

Graduates lacking experience start as account executives and will have the chance to work their way up to very senior positions. AEB plans to expand its branch networks and increase the number of relationship managers and consultants to continue its expansion in FAS services.

Taken from Career Times 12 January 2007
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