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Financial Planning / Wealth Management

Private banking gains momentum

by Grace Chan

Rosita Lee
assistant general manager
head of private banking and trust services
Hang Seng Bank Limited
Photo: Wallace Chan
Financial services stalwart raises the bar

The end of the financial crisis hailed a transformed period of robust growth for the mainland China economy and an expanding pool of well-to-do individuals are looking to Hong Kong for a diverse range of wealth management services.

Prospects for the local wealth management sector is looking rosy because of a shift of wealth from the West to the East, with Hong Kong and the mainland particularly well located in the region, says Rosita Lee, assistant general manager, head of private banking and trust services, Hang Seng Bank Limited.

"The appeal of Hong Kong's financial and investment services are merely due to mainland affluence. Foreign investors are also attracted by the city's position as a gateway to China," Ms Lee notes.

She adds that the government's Capital Investment Entrant Scheme, which grants qualifying applicants residence in Hong Kong if they make a capital investment of at least HK$6.5 million, has benefited the city's private banking sector since it draws considerable investment, mainly from affluent mainland customers.

Where Hong Kong people traditionally invested mainly in stocks and property because of limited choices, they are now keen to explore different avenues for growing their wealth, particularly considering the current low-interest environment.

Hang Seng Bank has therefore realigned its private banking business to offer a larger portfolio of personalised wealth management services, ranging from private trusts and inheritance arrangements to premium financing and property management, to clients with a minimum net worth of HK$10 million in assets.

Challenging field

The financial needs of high-net-worth clients differ greatly from those of general banking customers. "Their life insurance premiums alone, for instance, could be a huge sum that covers sufficient protection and potential cash value accumulation for the family," Ms Lee explains. "In order to optimise their cash management, they may need premium financing in order to benefit from low interest rates, while seeking higher investment returns for their liquid capital."

Most of the bank's affluent mainland clients are in their 30s and need advice on structuring their investment portfolios and offshore asset diversification. Hong Kong customers in the high-net-worth bracket, on the other hand, tend to be in their 40s or 50s with a growing need for guidance on inheritance and succession arrangements.

Unlike general banking, private banking does not involve standard product offerings. "This poses a big challenge to our relationship managers, as it is of paramount importance that they gain a thorough understanding of our clients' needs and expectations in order to provide them with the best possible advice and appropriate solutions."

For this reason, relationship managers need excellent communication skills. Ms Lee emphasises: "Our staff must also persevere in gaining clients' trust and building long-term relationships."

Hang Seng Bank's frontline professionals are supported by specialists in a number of areas, such as investment advisory services, insurance, property management, trusts, credit and financing, to help them cater for affluent clients' specific needs.

Best assets

Founded in 1933, Hang Seng Bank is firmly rooted in Hong Kong. "We understand business in Asia and the financial needs of Chinese people very well. We simply speak the same language," Ms Lee notes.

The bank was named "Best Local Private Bank in Hong Kong" and "Best Private Bank for Super Affluent ClientsĦXHong Kong" in the Euromoney Private Banking Survey 2010, a global benchmark for the industry.

In a bid to meet its clients' increasingly sophisticated expectations, the bank offers a fixed award to staff members who attained a professional qualification or completed a job-related education programme, via its "Professional Qualification and Education Award Scheme' as a means to encourage staff to pursue continuous learning. A number of Hang Seng Bank staff have over the past few years, successfully attained the Hong Kong Institute of Bankers (HKIB) Certified Financial Management PlannerTM (CFMPTM) accreditation.

"Hang Seng Bank pays premiums in enhancing frontline services and last year developed an internal certification programme with modules covering both technical and soft skills," Ms Lee remarks. Under the initiative, some 130 employees at all levels of the bank's private banking division attended an intensive five-month programme of classes after work. All of them passed the examination and were awarded certificates.

To facilitate positive changes for Hong Kong's banking and finance industry, the bank also plays an active part in the Outstanding Financial Management Planner Awards organised by the HKIB. Now in its fifth year running, the competition strives to promote industry excellence and has this year introduced a new category specifically focusing on high-net-worth customers. Ms Lee, who serves as a member of the adjudicating panel this year, believes the additional entry category will be an excellent benchmarking exercise for private banking professionals. "The awards provide a platform for sharing industry best practices in this field," she says.

Stellar performance

  • Emerging affluent mainland sector fuels demand for private banking services
  • Effective communication essential to trusting long-term client relations
  • Award scheme promotes continuous learning among staff

Taken from Career Times 24 July 2010


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