Multi-family offices and other intermediaries based in Singapore and Hong Kong are growing in number and taking market share from banks. Julius Baer is investing in new digital services and more relationship managers to support them.
In contrast to much of the rest of the world, the wealth management industry is growing quickly in Asia even now, reflecting the increase in the number of high-net-worth individuals benefiting from the region’s extraordinarily resilient economic growth.
For multi-family offices and other external asset managers (EAMs) operating out of Singapore and Hong Kong, this means that conditions are buoyant. More new firms are setting up all the time, and they are taking market share from the banks that are the rivals.
“We are talking to a new prospective EAM every other week, so from those encounters I feel that the trend of new EAMs setting up in Hong Kong and Singapore is still strong,” says Vianne Choo, Executive Director and Team Head, Intermediaries South East Asia at Julius Baer. “I see more of this in Singapore because we are based here, but I’m sure Hong Kong has also a good sizeable number of new EAMs.”
Catering to this growth, Choo’s team is taking on an increasing number of EAM clients, which it plans to provide with the efficiency of an ever more digital service. Currently, the client base numbers over 50 EAM firms and Choo reports that she has added a double-digit number of clients in the last 12 months.
Support through the crisis
Following the uncertainty in financial markets sparked by the outbreak of the COVID-19 crisis earlier in 2020, there has been a notable uptick in intermediaries turning to Julius Baer for expertise in wealth planning. “The pandemic has prompted some families to bring forward their wealth planning, which creates opportunities for their EAMs,” explains Vianne. “Actually, Julius Baer is originally family owned and it is in our DNA to understand and serve the needs of these families.”
Lightning-fast drops in markets during March also illustrated the need for digital trade execution and straight-through-processing. Julius Baer plans to pilot its new digital tool for Asian intermediaries towards the end of 2020, rolling it out across the client base in 2021. According to Choo, this should foster greater efficiency within EAMs, giving them potential for still more expansion.
During the crisis, the Julius Baer team extended its working day to help EAMs trade, covering the markets beyond the normal 18.00 hours Singapore time close. It also provided more frequent market updates, as EAMs needed to understand what was driving the extreme volatility in equity and bond markets so that they could adjust clients’ asset allocations accordingly. Even now, the Singapore team arranges calls with Julius Baer’s market analysts most weeks.
You will see that we have multi-asset backgrounds in terms of the knowledge that we have, which helps us to better understand the needs of intermediaries.
Expecting continued growth
The Julius Baer intermediaries team in Singapore has a strong brand as it has served local EAMs for more than 10 years. It’s uniquely positioned to meet their increasing needs, comprising a range of product specialists. Choo, who has headed the team for two years, is an expert in structured products, with a master’s degree in financial engineering. Other team members are former portfolio managers and investment analysts.
“You will see that we have multi-asset backgrounds in terms of the knowledge that we have, which helps us to better understand the needs of intermediaries,” she explains. “Many of our team members were not relationship managers before, just as I was not before I joined Julius Baer.”
Throughout the testing times of 2020, EAMs have called on all of these types of skills at different times. Broadly speaking, they have looked for expertise in all areas –wealth planning, investment products and lending. Often, they may want customised solutions spanning several of these areas.
Looking forward, Choo expects that the number of EAMs in Singapore and Hong Kong will continue to expand, observing that many of them are currently on a recruitment drive. Julius Baer in Singapore is also investing and expanding to support this growth.
- The intermediary sector is growing quickly in Singapore and Hong Kong, as the region’s new wealthy turn to the model for wealth management.
- During 2020’s uncertainty, Julius Baer has supported local EAMs with a variety of needs, including a demand for wealth planning and longer trading hours.
- All the signs are that expansion will continue. Julius Baer is investing in new digital tools and relationship managers to support this growth.