Offshore private banking will thrive, say wealth managers
Services such as estate planning will always be needed
By CONRAD TAN 06 October 2009
Offshore private banking will continue to flourish despite the increased pressure on financial centres to share information with foreign tax authorities, senior wealth managers said yesterday.
‘There are many good reasons why the offshore private banking industry will continue to thrive,’ said Chris Meares, chief executive of global private banking at HSBC.
Not all wealthy people move money abroad for tax reasons, he told the audience at a wealth-management conference organised by VRL Financial News - which publishes the Private Banker International (PBI) journal - in conjunction with the annual Private Banker International Global Awards.
For many clients, ‘it’s about diversification of risk, hedging against political risk and tapping into the wealth management skills and capital markets wherever they are deepest’, Mr. Meares added.
As such, international financial centres such as Singapore and Hong Kong are expected to continue to do well, he said.
John Evans, PBI’s editor-at-large who chaired the event, said globalisation meant that ‘there will be more and more people’ who want private banking services, whether at home or abroad.
Daniel Truchi, global CEO of SG Private Banking, said offshore banking services, such as estate planning and succession planning, will continue to be in strong demand.
‘So I don’t think that the offshore model will be affected too much.’
In particular, wealth creation in the near future will be fastest in rapidly growing economies such as China and India, but these countries’ domestic banking markets are still difficult for foreign banks to enter, which means they will continue to offer offshore banking services to clients there, Mr. Truchi pointed out.
He also warned against over-regulation of the industry in the wake of the global financial crisis.
As an industry, ‘we have lost a lot of trust’, he added.
‘We need a lot more professionals - real professionals, not mercenaries - to gain respect from clients.’
And the extra cost of complying with more rules will lower the return on equity that private banks can earn in future, he said.
‘It’s still a business where the ROE is very high, however, and that’s why banks will continue to invest in the business.’ he added.
At the awards dinner last night, HSBC Private Bank was named outstanding global private bank of the year, the top PBI award, while Standard Chartered Private Bank took home the award for outstanding private bank in the Asia-Pacific, for the second year in a row.
Credit Suisse, which won last year’s top award, was named outstanding private bank for ultra high net worth clients.
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Offshore private banking will thrive, say wealth managers
Services such as estate planning will always be needed
By CONRAD TAN
06 October 2009
Offshore private banking will continue to flourish despite the increased pressure on financial centres to share information with foreign tax authorities, senior wealth managers said yesterday.
‘There are many good reasons why the offshore private banking industry will continue to thrive,’ said Chris Meares, chief executive of global private banking at HSBC.
Not all wealthy people move money abroad for tax reasons, he told the audience at a wealth-management conference organised by VRL Financial News - which publishes the Private Banker International (PBI) journal - in conjunction with the annual Private Banker International Global Awards.
For many clients, ‘it’s about diversification of risk, hedging against political risk and tapping into the wealth management skills and capital markets wherever they are deepest’, Mr. Meares added.
As such, international financial centres such as Singapore and Hong Kong are expected to continue to do well, he said.
John Evans, PBI’s editor-at-large who chaired the event, said globalisation meant that ‘there will be more and more people’ who want private banking services, whether at home or abroad.
Daniel Truchi, global CEO of SG Private Banking, said offshore banking services, such as estate planning and succession planning, will continue to be in strong demand.
‘So I don’t think that the offshore model will be affected too much.’
In particular, wealth creation in the near future will be fastest in rapidly growing economies such as China and India, but these countries’ domestic banking markets are still difficult for foreign banks to enter, which means they will continue to offer offshore banking services to clients there, Mr. Truchi pointed out.
He also warned against over-regulation of the industry in the wake of the global financial crisis.
As an industry, ‘we have lost a lot of trust’, he added.
‘We need a lot more professionals - real professionals, not mercenaries - to gain respect from clients.’
And the extra cost of complying with more rules will lower the return on equity that private banks can earn in future, he said.
‘It’s still a business where the ROE is very high, however, and that’s why banks will continue to invest in the business.’ he added.
At the awards dinner last night, HSBC Private Bank was named outstanding global private bank of the year, the top PBI award, while Standard Chartered Private Bank took home the award for outstanding private bank in the Asia-Pacific, for the second year in a row.
Credit Suisse, which won last year’s top award, was named outstanding private bank for ultra high net worth clients.
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