Money Moves

Transforming Hong Kong's financial landscape

by Mayse Lam

Rico Chow (left) and Lam Wong, directors
Links Wealth Management Limited
Photo: Johnny Kwok

The accelerated development of treasury and banking products and services in Hong Kong; plus the growing demand for such products and services have led to aggressive competition between financial institutions. New trends in business development are replacing traditional practices.

"As an international financial centre, Hong Kong has always been keen to facilitate the development of new financial products and markets. However, in the past three years change has been remarkably fast with both positive and negative consequences," says Rico Chow, a director of Links Wealth Management Limited.

Economic growth and reform have generated more demand for wealth management. "The optimism within the financial industry stems from the increasing number of individuals who are planning for their futures. There is evidence of an escalation in educational funds and retirement savings, for instance," adds Lam Wong, also a director at Links Wealth Management.

However, the tremendous business opportunities in the industry have also had some less desirable effects. "We are now finding people with little or no finance-related experience breaking into the industry," Mr Chow notes.

Both directors feel that intense competition between financial practitioners have produced some unwanted results. "Unqualified individuals lack the essential financial experience and the right attitude. It can be difficult to monitor their ethics and credentials," Mr Wong says. "This can have a tremendous impact not only on our reputation as financial consultants, but also on the clients' financial standing, as they could be led towards unwise investments or discouraged from planning for their futures if these unqualified consultants' goals are to increase personal business revenues," Mr Wong adds.

In order to enhance the Hong Kong financial sector's competitive edge, the number and range of investment products and commercial services on offer have greatly increased over the past years. As a result, the key to success in the market is not the products themselves, but the professional services that financial practitioners offer their clients, Mr Wong says.

"Compared to other banks, insurance companies and IFAs (independent financial advisors), which recruit hundreds of members, we are considered small-scale. Nevertheless, the few financial consultants we recruit have been selected for their morality, values and previous work experience," explains Mr Chow. "We are hesitant to recruit fresh graduates," Mr Wong continues, "They may not be well-prepared to manage our clients' assets. We don't think they can provide professional guidance without having developed their own wealth management skills."

"If Hong Kong is to sustain its position as a competitive and well-respected international financial leader, it is absolutely necessary for us to promote co-operation among market participants. It is extremely important that we ensure appropriate ethical codes," Mr Chow concludes.

Taken from Career Times 31 August 2007, p. A16
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