Top 3 factors Asia investors look out for in private banking

Perspectives from the Ecosystem: A series of Q&A with Lombard Odier’s Ecosystem¹ of Strategic Alliances

Asia's wealth management industry has seen rapid growth in recent years with reports stating that Asia-Pacific's Assets under Management is expected to outpace any other region globally by 2025². Against this backdrop of growing wealth, we are seeing a shift towards a buyers' market, with greater focus and scrutiny placed on asset managers to dish out the right investment advice.

As revealed in Lombard Odier's study of Asia-Pacific's High-Net-Worth Individuals (HNWIs) Survey in 2021, investors are increasingly relying on banks to guide them through the post-pandemic and endemic uncertainties, and their willingness to delegate portfolio management is on the rise. Particularly, investors are seeing increased differences across domestic markets amidst today's global economy, and are looking for more direction from banks to navigate individual markets.

We took the opportunity to speak with Lombard Odier's Ecosystem of Strategic Alliances, which consists of some of the leading financial institutions in Asia-Pacific, to understand the top three factors that investors look out for when choosing a private bank and the factors that impact each individual market.

Answers from four Heads of Wealth Management institutions across Asia:

Perspectives on investors in the Thai market

The bottom line: Service-oriented mindset and investment guidance

According to findings from our 2021 HNWI survey, it has never been more important for Thai investors to diversify into a global portfolio given today's uncertainty and volatility. 91% of Thai investors are looking to increasingly delegate and leverage their bank's expertise to navigate market uncertainty through managed solutions.

This echoed the observations made by Jirawat Supornpaibul, Private Banking Group Head, KASIKORNBANK Thailand, who shared that Thai investors look for acute investment advice when choosing a private bank.

“In addition to sharp, expert investment advice, investors in Thailand also place great importance on a bank's attitude and approach – its service-oriented mindset, its willingness and ability to serve, and how it solves problems. Finally, they also look for an institution that is able to provide comprehensive services, offer easy access to information and can easily make transactions," Jirawat added.

Perspectives on investors in the Filipino market

The bottom line: One-stop shop, family services advisory and a solid digital platform

Commenting on factors that impact Filipino investors in their choice of a private banking partner, Arlene Joan T. Agustin, Senior Vice-President, Private Banking Group Head, UnionBank of the Philippines noted that UnionBank's clients are looking for a “one-stop shop" when it comes to investment management and advisory. They are looking for bespoke servicing and best-in-class local and global investment outlets.

“They are looking for private banks that can help them globalise and diversify their investment portfolio, not only in terms of asset selection but also risk management", she added.

“Secondly, there is rising interest in estate and succession planning, especially amongst UHNW clients. Besides investment management, family services advisory is also one of the services clients appreciate and look for, especially those with family offices and family businesses.“In today's age of information technology, one of the main asks of our clients is a reliable and secure digital banking platform where they can view and manage their accounts and investment portfolios on demand. In fact, in recent years, this has become a non-negotiable for most tech-savvy clients and UnionBank Private Banking has a slew of digitisation efforts in the pipeline to address this," she added.

Perspectives on investors in Japan

The bottom line: First in class investment and advisory solutions and global capabilities

Likewise in Japan, when choosing a private bank, better investment and advisory solutions remain key for investors, as well the bank's capabilities in providing customised and global capabilities and expertise.

Yuichi Kagawa, Head of Wealth Management, Mizuho Securities (Singapore)  commented, “Nowadays, in addition to typical UNHW Japanese clients' cash flow investment needs, there is growing demand for diversified investment and advisory needs under the current and foreseeable market situations. As a result, it is now an imperative for a private bank to be able to provide better investment and advisory solutions to the Japanese UNHW client segment to satisfy their needs."

He added, “Japanese UNHWs clients are also seeking more bespoke investment solutions such as Separately Managed Accounts (SMAs) that allow for direct holdings to tailor their strategies."

Mr. Kagawa noted that investors place heavy emphasis on a bank's global capabilities. “With rather restrictive financial regulations, Japanese UHNW clients expect greater access to global investment opportunities that cannot be obtained domestically. Leaders in the private banking industry should stand out if they are able to showcase their capabilities in providing platforms to access global investment," he says.

Perspectives from Lombard Odier

The bottom line: Pan Asian demand for global expertise & a steady expert hand

At Lombard Odier, we are seeing a clear upward trajectory in the demand and appetite for access to global markets, tailored wealth management and family office services for our clients in Asia. Besides seeking bespoke solutions and global capabilities, investors are also increasingly looking for local expertise, especially amidst today's pandemic-hit business climate where investors are more cautious and are in need of increased guidance to navigate individual markets.

Vincent Magnenat, Limited Partner and CEO, Asia, Lombard Odier, commented, “What we observe in our Asia domiciled clients across our three Asia offices in Singapore, Hong Kong and Japan, as well as insights from our conversation with our Strategic Alliances is that a mix of onshore and offshore services will be a defining feature of private banking in the future."

“Investors are looking for holistic solutions with a bespoke level of excellence tailored to their investment and banking needs. They are also looking for private banks who can provide guidance towards diversification outside their domestic markets, which is critical in today's context of heightened volatility and divergence. At Lombard Odier, investors benefit from the shared knowledge gained through access to our ecosystem of Strategic Alliances. Increasingly clients appreciate having access to global investment and family advisories whilst also having the option of tapping into the wide network and local expertise offered by our Ecosystem of Strategic Alliances."

¹ A unique model in Asia, Lombard Odier’s Strategic Alliance Ecosystem brings the bank’s investment and family services expertise together with that of the leading local financial institutions in the region to holistically serve the wealth management requirements of entrepreneurs and families. Clients are offered a tailored level of excellence to satisfy both their local and international private banking and investment needs.

² Asset & Wealth Management 2025, The Asian Awakening, PWC report