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�is guide is for the use of professionals only. It states the position of the market as at the time of going to press and is not a substitute for detailed local knowledge.
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Contents A decade of private banking By Helen Avery 2
A leader in wealth management China Minsheng Banking Corp 4
Chinese private banking grows up By Kanika Saigal 6
A new generation of wealth emerges China Merchants Bank 8
10th Private banking survey global and regional results and data 10
Wealthier, wiser clients test China’s banksBy Simon Parry 22
Asia PB Contents.indd 1 04/07/2013 16:11
Euromoney celebrates the 10th anniversary of its private banking survey this year. It has been a decade of changes driven by globalization and transparency. Despite a global financial crisis, a eurozone meltdown and a regulatory overhaul, the top-five global private banks have retained their standings
A decade of private banking
By: Helen Avery
Private banking
©Reprinted from Euromoney magazine February 2013 Copyright Euromoney magazine www.euromoney.com2
Market volatility re-
mained high in 2012
as the eurozone crisis
intensi�ed, fears per-
sisted about China’s
slowing growth, and the US offered its own
uncertainties with an election and a �scal
cliff. For the world’s private banks, it was
a continuing battle to �nd yield for clients
and to protect their wealth from geopo-
litical risk – all in the face of increasing
regulatory requirements and pressure to
cut costs and increase revenues. The cost of
compliance is 10% of the turnover of pri-
vate banks and wealth managers, according
to research by ComPeer. “With costs and
the time that is required to be compliant
with the tsunami of regulations that have
been introduced over the last decade,
only those truly committed are
able to maintain a busi-
ness today,” says Bruce
Weatherill, a private bank-
ing consultant and board
member of ComPeer.
It is a marked change from
when the �rst Euromoney
private banking survey was
published in January 2004. Back
then the private banking industry
was enjoying rapid growth. Survey
participants reported growth in
assets under management over 2003
to be 16.7%. This year participants report-
ed annual AUM growth of just under 11%.
In 2003, markets were reliably producing
annual double-digit returns, M&A activity
was everywhere, salaries were climbing
and the biggest concern was how to keep a
client’s money secret. Private banking was
an industry that everyone wanted to be
in. Local retail banks started to
add private banking capabilities.
Those serving the super-af�uent
branched into the higher-net-
worth segments and vice versa.
In the 2004 survey, respondents
claimed to be offering services in
every wealth stream from super-
af�uent to ultra-high-net-worth.
This year,
there is a stark contrast. Respondents have
had to home in on where their strengths lie
and have begun to focus on speci�c wealth
segments. Now their responses reveal
that they do not want to be everything to
everyone. “At a business-model level there
has had to be a dramatic adjustment in
expectations over the past decade,” says
Seb Dovey, managing partner at private
banking research and advisory �rm Scorpio
Partnership. “At the start there was una-
bashed exuberance regarding growth. The
strategies of most wealth managers in this
context have never met expectations. Today
we are in an environment where virtually
all wealth managers are feeling not just
a pinch but a total squeeze. Five years of
relatively static growth makes it dif�cult
for many to endure under their historical
approach to the market.”
As the Euromoney survey celebrates its
10th anniversary, the traditional private
banking characteristic of secrecy and tax
advice dished out in oak-panelled board-
rooms also seems a distant memory. In
2003 tax guidance and advice was offered
by 64% of respondents. Now that �gure
has dropped to 59%, and banks are quick
to point out that they are not tax advisers.
The products and services offered by the
private banks have also changed. Around
80% of respondents 10 years ago offered
hedge fund investments. Now that is
65%. Structured products that were also
the bread and butter for many private
banks have lost their shine. Ten years
ago around 87% of respondents said
they offered structured products; now
that has fallen to 77%. “Over the
last decade, and particular-
ly since trust was lost
over the �nancial
crisis, clients have
wanted simpler
services and
simpler
products,
and that has
had to be
re�ected by
the banks,”
says Weath-
erill.
Philanthropy
has become
more important as the baby boomers have
aged. Only a third of private banks offered
advice on philanthropy in Euromoney’s �rst
survey. Now more than half of the industry
is involved with it.
Private banking has become increas-
ingly transparent, global and modern – in
line with the clients it now serves. (See
how the chief executives of the leading
private banks comment on the differences
in Euromoney’s roundtable on page 62)
Yet some things have not changed. The top
�ve best global private banks ranked in the
survey are the same players: UBS, Credit
Suisse, Citi, JPMorgan and HSBC. It is the
large players with global footprints and
diversi�ed revenue streams that have man-
aged to weather the credit crisis and remain
relevant with high-net-worth clients.
Over the years the top-�ve banks have
jostled for position. This year a shake-up in
the rankings has occurred as the �nancial
crisis settles and those �rms that have spent
the past 12 months focusing on private
banking have made headway. UBS has
returned to the top of the global table after
a three-year hiatus and this year wins the
award for best global private bank. Credit
Suisse had stolen its position, but after
mending its reputation in the US and do-
mestic market of Switzerland, UBS has suc-
ceeded in returning to the position it held
when Euromoney’s survey began. Region-
ally the �rm is back on top. In western Eu-
rope it ranks �rst this year, moving Credit
Suisse to second place. In Asia, too, UBS
has made headway, ousting long-standing
leader in the region HSBC, which this year
moved from �rst to third behind Citi.
JPMorgan also stands out this year. The
bank has made it to third position globally,
up from fourth last year, and across a wide
range of products has made considerable
strides to top-two positions globally, such
as in equity and �xed-income portfolio
management and structured products. It
ranks �rst in its domestic market of north
America and has made leaps up the table in
Latin America. This year it ranks second in
the region behind Citi, which has returned
to a number one position after being
ranked third last year.
Back in the top 10 globally too is Gold-
man Sachs, nudging Barclays out despite
the latter’s big investments in its wealth
management franchise. Indeed a glance
at the top 10 this year compared with
the �rst Euromoney survey shows little
change among the players, emphasizing
the success of the global strategy. Other
than Pictet and MeesPierson, which have
been replaced by Santander and Merrill
Lynch, the top 10 private banks ranked
globally remain the same. Where there have
been notable changes is among the 11th
to 25th positions, indicating the pressures
on those banks of medium size and the
impact of globalization. In a market once
dominated by Europeans, Asia’s banks are
now competing globally. Kotak Mahindra,
Bank of China and China Merchants Bank
now rank among the top 25 private banks
globally.
The world of the wealthy has changed
dramatically over the past 10 years and is
on the cusp of yet further changes as Asia’s
population of wealthy individuals increases,
and as banking and technology collide. Ac-
cording to a study by SEI, Scorpio Partner-
ship and Standard Chartered Private Bank,
high-net-worth individuals spend more
time using digital channels such as email,
instant messaging, social networks and
texting than those lower down the wealth
spectrum. And wealthy individuals in
Asia-Paci�c communicate more via digital
channels than in Europe and the Americas.
The chief executives of private banks high-
light that over the next 10 years technology
will be one of the biggest changes for the
industry. But it means yet further costs for
private banks. In a less pro�table industry
than a decade ago, only those institutions
committed to private banking are likely to
stay the course.
3©Reprinted from Euromoney magazine February 2013 Copyright Euromoney magazine www.euromoney.com
Then and now Key indicators in 2013 and 2004 10th survey First survey
% %
Average of annual AUM growth 10.8 16.7
Services offered (by % of respondents) 10th survey First survey
Art banking and numismatics 30.1 29.7
Corporate advisory for private banking clients 74.4 64.4
Family office services 77.5 53.4
Islamic banking services 17.8 28.8
Offshore services 68.4 75.4
Philanthropy services 50.6 32.2
Tax guidance and services 58.9 63.6
Asset classes offered (by % of respondents) 10th survey First survey
Foreign exchange 75.5 92.4
Hedge funds 64.9 80.5
Precious metals 64.5 44.9
Private equity 65.8 66.9
Real estate 65.9 49.2
Structured products 77.1 87.3
Source: Euromoney
“Over the last decade, and particularly since trust was lost over the financial crisis, clients have wanted simpler services
and simpler products”Bruce Weatherill, ComPeer
A EUROMONEY MAGAZINE sponsored statement
A LEADER IN WEALTH MANAGEMENTChina Minsheng Banking Corp has established itself as a true leader in wealth management across the country – and its expert private banking team is now giving its support to a second generation of wealth creators
Zhang Sheng, head of private banking, China Minsheng Banking Corp
China’s wealth is growing quickly. Every day there are more high-net-worth individuals (HNWIs) and greater demand for wealth management services to cater to their increasingly sophisticated needs and requirements.
China Minsheng Banking Corp (CMBC) is acutely aware of this trend. Its private banking division is growing step by step with the country’s wealthy, working tirelessly to fulfil their demands with a keen listening ear and unparalleled levels of expertise.
In the past year, the customer base of CMBC Private Banking has increased by more than 100% and the assets it manages on behalf of HNWIs have grown by more than 87%.
There is no accident in the ability of CMBC Private Banking to continue attract the nation’s wealthy in such numbers. The bank’s approach is based upon innovation, efficiency, a finely-tuned competitiveness – and a strong belief in listening to customers.
CMBC Private Banking formulates its investment policies on the basis of extensive, scientific market research so that customers can be sure the advice they receive is based upon the very best and most up-to-date insights. The relationship between bank and customer goes much deeper than the provision of basic financial products and services, however. It is typified in every case by in-depth communication and a profound understanding of the individual customer’s needs.
It is this holistic approach – offering each customer a unique
tailor-made suite of services – that has kept CMBC Private Banking ahead of the competition and established it as one of the leaders in private banking in China and Asia as a whole.
Family mattersToday, more than ever, questions of succession are on the minds of China’s HNWIs, as the first generation of modern entrepreneurs prepares to hand over the reins of power to their sons and daughters.Transition planning is the new catchphrase for the country’s wealthy – and CMBC Private Banking is deploying its wisdom, creativity and ingenuity to find the solutions that best match the families facing up to this critical process.
A dedicated new division has been set up by CMBC Private Banking to explore this new market, to focus on HNWIs and their family affairs, innovatively addressing their issues and being a leader in this important emerging element of wealth management.
Putting customers firstCustomers have always been the first and most important focus of CMBC Private Banking’s mission. The bank’s development and evolution have been driven by the demands and requirements of customers.
Today, the bank has specialized units for private banking customers at 33 of its branches, concentrating on the specific needs of HNWI customers with investible assets of RMB8 million or more.
Dedicated teams focus on providing tailor-made wealth management services for customers and their family members, offering a comprehensive suite of services including investment management, financial management and strategic consultancy to cater for all aspects of their financial futures.
A reputation for excellenceThe success of CMBC Private Banking, and its ability to continue to draw record numbers of HNWI
customers, is based upon the most solid of foundations: its reputation for excellence.
CMBC Private Banking has steadily built up an enviable level of expertise, drawing on superior resources and a nationwide network to provide the highest levels of service and products on the market. It has built powerful alliances with leading domestic institutions to offer its customers the very best options to safeguard their wealth and inheritance.
Internationally, it maintains a firm foothold in global asset allocation by fully using overseas resources – allowing for cooperation with global financial organizations on products, information, labour, investment and training.
It has been a tireless journey for CMBC Private Banking so far – constantly seeking out the very best that is available on the market domestically and internationally for customers in order to maintain its position as the leader in wealth management.
But as any entrepreneur will tell you, there can never be any compromise on excellence. CMBC Private Banking is committed to being the number one private bank and the first resource for HNWIs across China as its astonishing ascendancy continues.
Now more than ever – as China’s first generation of entrepreneurs prepares to hand over to a new generation of wealth creators – CMBC Private Banking is determined to be a faithful and dependable partner to them, every step of the way.
Supported by strong economic growth, China’s domestic private banking sector has been developing rapidly. But could a lack of education and mounting competition from overseas stall its progress?
Chinese private banking grows up
By: Kanika Saigal
Private banking
©Reprinted from Euromoney magazine February 2013 Copyright Euromoney magazine www.euromoney.com6
China’s economic boom of
the 1970s spurred by Deng
Xiaoping’s economic reforms
turned entrepreneurs into
millionaires. And although
China’s economy has slowed recently, in rela-
tive terms it is holding up well.
On the back of its economic growth, China
has become the second-largest wealth man-
agement market in Asia Paci�c. According to
research by Boston Consulting Group in con-
junction with China Construction Bank, the
number of Chinese high-net-worth individu-
als (HNWIs – those with at least $1 million
in investable assets) doubled from 510,000 in
2008 to 1,030,000 by the end of 2010.
China’s �nancial institutions and banks are
rapidly adapting to the needs of this growing
number of HNWIs. The strength of China’s
private banks has been marked by impres-
sive gains in the league tables. According to
Euromoney’s private banking survey, China
Merchant Bank rose from 26th place to 19th
globally last year, breaking into the top 20
best private banks for the �rst time. Bank of
China rose to 21st place globally, up from
27th place the previous year.
For all its recent progress, the Chinese
private banking sector is still relatively young,
and its development so far suggests that when
it matures it will look different to its western
equivalent.
“Private banking in China in its current
form is more akin to red-carpet retail banking
than private banking as you might know it,”
says Jason Bedford, senior manager, �nancial
services, at KPMG in China.
The closest thing to more traditional
private banking in China is the business
model of trust companies on the mainland,
says Bedford “They have dedicated client
relationship managers for HNWIs; they host
events; and their product development capa-
bility ranges from capital growth products
through to capital preservation products and
vanity products – such as funds investing in
�ne wine or tea.” However, they do not have
an open infrastructure: “[trust companies in
China] sell only their own products and not
other companies’ products.”
Alfred Shang, partner at Bain & Company,
says: “Since 2007, when the private bank-
ing industry really took off, we have seen
competition intensifying as more �nancial
institutions rush to capture market share.
Commercial banks are rolling out their own
private banking services. Other groups of �-
nancial institutions, such as securities houses,
third-party wealth management institu-
tions, trusts and funds, have also developed
dedicated wealth management services for
high-end customers.” But despite the range of
providers “most of the products and services
offered in the market today still tend to be
rather homogeneous,” he says.
THE RECENT INFLUX OF BANKS
seeking to grab a piece of the pie has raised
concerns that lax practices and standards
could enter the system, according to Bassam
Salem, Asia Paci�c CEO of Citi Private Bank.
But he adds that the hope is that this will
eventually rectify itself. “Players without a
strong platform encompassing the discipline
of transparency, appropriate sales practices
and control undoubtedly will be eventually
weeded out,” he says.
But at this early stage, understanding the
differences between a private bank and other
types of wealth management has proved
dif�cult for some. According to a report by
McKinsey and Mingsheng Bank, around
45% of HNWIs in China have only a limited
understanding of what private banking is.
According to Salem, outside the large
urban centres there is some misunderstanding
of what a private bank can do for clients. “In
fact many think they already have a private
banking relationship when what they really
have is a high-end retail relationship.”
“Investors �nd it exceedingly dif�cult and
frustrating to manoeuvre through the current
regulatory environment,” adds Kenny Lam,
partner at McKinsey and based in Singapore.
“Unless regulators pull together a compre-
hensive framework for private banking in
China, the business will lose momentum.”
Some argue that the lack of education has
an adverse effect on client-manager relation-
ships. “Chinese investors are not the most so-
phisticated,” says one observer. “Trust compa-
nies and private banks have often complained
that some of their clients have become violent
and aggressive when investments haven’t
performed the way they expected. The fact is
that many HNWIs just do not understand the
risks attached to certain investments.”
Salem and Lam agree that if private bank-
ing is to continue its expansion in China,
improved education and understanding will
be crucial. Some domestic private banks are
starting to pick up on this. China Merchants
Bank, for instance, has invested capital and
resources in brand building, advertising and
organizing upscale events and activities to
draw attention to their brand and to make
sure that HNWIs understand the services on
offer. “As a result, HNWIs have increased
brand awareness of our bank,” says Ma Wei
Hua, CEO of China Merchants Bank. And
according to Ma, their strategy has worked:
“Over half [of HNWIs in China] list Chinese
private banks as their primary wealth man-
agement provider.”
ATTITUDES TOWARDS RISK AND
portfolio management are also evolving. The
heightened market volatility of recent years
has prompted many investors in China to re-
evaluate their investment strategies. From a
culture that used to focus squarely on wealth
generation, Chinese HNWIs are starting to
embrace wealth preservation through diver-
si� cation, according to surveys conducted
by Bain & Company with China Merchants
Bank.
“In our 2007 report, we observed that
customers’ top investment objective was to
maximize their returns,” highlights Shang.
“By the time of our latest report in 2011,
customers had shifted their priorities to
wealth protection and security. They are also
becoming increasingly sophisticated. Most
are picking their providers based on brand
recognition, and are looking for offshore
investment opportunities.”
Edmund Koh, CEO of UBS wealth man-
agement Singapore & APAC hub, highlights
how this is expressed through HNWIs’ buy-
ing patterns: “While traditional asset classes
such as equities, bonds and mutual funds
continue to form the majority of clients’ port-
folios, interest in alternative investments such
as hedge funds, private equity and commodi-
ties is increasing.”
When it comes to onshore investments, do-
mestic private banks have the advantage over
international competitors. “In China, private
banking onshore is limited by regulators,
so domestic and international banks play
by the same rules,” says Lam. But because
Chinese investors have closer ties to domestic
bank branches, they gravitate towards them.
“Building trust with the customers is an
important cultural aspect, and many HNWIs
still choose their providers through friends’ or
family’s referral,” explains Shang. “This gives
local banks an edge over foreign banks.”
This isn’t to say that Chinese private banks
necessarily outperform well-established
international private banks. Indeed, domestic-
based private banks can be at a disadvantage
when it comes to offshore investing. “Often,
there is a divergence in the types of prod-
ucts and services that banks based in China
offer compared with a bank based in Hong
Kong for instance,” says Lam. “For offshore
purposes, Chinese HNWIs are most likely to
bank out of Hong Kong, Singapore or even
the US and Europe.” According to Wealth
X, a provider of intelligence on ultra-high-
net-worth individuals, 64% of Singapore’s
ultra-wealthy community, with at least $30
million in assets, are non-Singaporeans. Of
this number, mainland Chinese HNWIs ac-
count for about 21%.
There are several other factors that can
motivate a customer to go offshore, some
more extreme than others. “There is a decent
chance that those that have amassed large
amounts of wealth have done so in a way
that is not entirely legitimate,” says one
commentator. “For argument’s sake, say an
international private bank and a domestic
private bank or trust company offer the same
products at the same price, the Chinese inves-
tor would most likely choose to go offshore.
The investment is safer and so is their private
information. If the Chinese authorities were
to make a private investigation, the Chinese
company would be obliged to divulge its cli-
ent’s information; the international company,
on the other hand, wouldn’t.”
The case of Bo Xi Lai is a prime exam-
ple. Following the downfall of the former
politburo member, Beijing seized a majority
of Bo’s onshore assets. But of� cial accounts of
his offshore assets are unknown and therefore
beyond the reach of the authorities.
“HNWIs in general tend to have more
than one banking relationship, and this is
true of Chinese clients too,” says Salem.
“They prefer domestic banks when it comes
to plain-vanilla banking at home, mainly
because they have larger branch and ATM
networks. But business owners who are active
in the region or globally quickly realize the
bene� ts of a global foreign bank compared
with a local bank.”
Chinese private banks are not blind to
offshore competition. “Domestic banks are
also expanding their coverage regionally, in
particularly in Hong Kong. This will result in
more intense competition with foreign banks
in the future,” says Shang.
In the case of ICBC, by the end of 2012
its private bank had established 36 locations
across China, along with Hong Kong and Eu-
rope. In the next couple of years, the Chinese
private bank plans to expand into markets
such as the Middle East, Singapore and far-
ther into southeast Asia to keep up with the
growing market and the competition.
Some argue that the importance of com-
petition between domestic and international
banks might be overblown and that there is
enough business to go around. “It is unlikely
that HNWIs will use one private bank for all
their investments,” explains Shang. “Entrepre-
neurs and professional managers account for
approximately 60% and 15% of HNWIs re-
spectively. Given their pro� le and needs, they
usually use one or two providers for their
transactional banking, another one or two
for private banking, and others for their busi-
nesses and offshore assets. It is unlikely that
one bank will ful� l all of these functions.”
Ultra-HNWIs will always maintain several
banking relationships, if for no other reason
than because they want a diversity of choice,
explains Salem. “However, it is our experi-
ence that clients will often have one major or
house bank that completely understands their
� nancial picture, and other smaller banks
for product or service purposes. The key to
becoming a client’s house bank is to offer
the most comprehensive set of products and
services.”
7©Reprinted from Euromoney magazine February 2013 Copyright Euromoney magazine www.euromoney.com
While traditional
asset classes continue
to form the majority
of clients’ portfolios,
interest in alternative
investments such
as hedge funds,
private equity and
commodities is
increasing
Edmund Koh, UBS
A EUROMONEY MAGAZINE sponsored statement
A NEW GENERATION OF WEALTH EMERGESThe China Private Wealth Report 2013 paints a fascinating picture of a country that is growing richer but looking to its next generation like never before. The evolution of private banking in China is analysed by Liu Jianjun, head of retail banking at China Merchants Bank, which produced the report in conjunction with Bain & Company
Liu Jianjun, head of retail banking, China Merchants Bank
What does your report tell us about private banking customers in China in 2013? How are their demands changing, and are they still growing in numbers?Most Chinese high-net-worth individuals (HNWIs) are business owners – mostly first-generation entrepreneurs – and most are aged between 40 and 60. As their businesses become stable and successful and their children approach adulthood, many have begun to consider wealth inheritance. Meanwhile, wealth preservation has replaced wealth creation as their primary wealth management objective.
Following recent market ups and downs, Chinese HNWIs have a more conservative attitude toward investment and an increasingly mature investment philosophy. HNWIs now prefer more moderate investment risks, focusing their allocation on moderate and low-risk investment products, rather than high-risk and high-return products.
As more HNWIs begin to focus on wealth preservation, more investors are seeking to manage market risks by diversifying their investments and pursuing moderate returns, and they are showing more interest in diversifying the allocation of their assets through overseas investments.
We predict that China’s private wealth market will maintain its growth momentum in 2013, and individual investable assets may reach RMB92 trillion, a 14% annual increase. The population of HNWIs will continue to grow
in 2013, reaching about 840,000, representing an estimated 20% annual increase from the previous year. Total wealth owned by HNWIs could reach RMB27 trillion, a 22% compound annual increase.
Is the trend towards a more cautious approach to investment a temporary one or a long-term movement in your opinion?Many HNWIs have established their businesses and are now focused on ensuring future living standards for themselves and their families. To that end, the preservation and stable increase of wealth has become increasingly important. They have some concerns regarding policy trends, market risks and business operational risks, and ultra-HNWIs are more focused on what they perceive as the unpredictability of marriage, family and personal health risks.
As the needs of HNWIs changed, HNWIs in our survey
showed high interest in family trusts and overseas asset allocation in addition to the traditional and more stable investments, such as cash, deposits and bonds. These kinds of services will be increasingly favoured by HNWIs.
What in your view are the biggest challenges for the private banking market in China in the years ahead and how can these challenges be overcome? Over the past few years, HNWIs have developed a stronger awareness of the need to manage their wealth, which has fostered a higher reliance on private banking services. China’s private banks have become the primary choice in the domestic market due to their advantages in brand, service and product. Since private banks are preferred by Chinese HNWIs, the competitive situation requires us to offer tailored and differentiated products and services to targeted customer segments. This requires in-depth study on the overall wealth management demands of each customer segment.
Chinese private banks should segment customer groups using multiple dimensions, such as occupation, asset size and overseas investment needs, giving them a precise and comprehensive understanding of customer needs.
Besides meeting each segment’s needs, the core of private bank services should transfer from product portfolio allocation to overall wealth management planning and comprehensive financial
services. Private banks can respond to these changes and build a long-term partnership with customers by earning their trust.
The domestic private banking industry is in a critical period of development, and the key to improving competitiveness is to build a high-quality service team and a diversified product and service platform quickly and effectively. Private banks may need to invest in human capital to ensure they have the talent and extensive expertise to meet customer service objectives. They also should consider the need to take advantage of their own networks and resources to expand products and services in accordance with the regulatory framework. Your bank has been researching and producing the China Private Wealth Report since 2009. Over the years, what has it shown you about the industry’s development and direction?China’s private wealth market has transformed from a time of opportunity in the early days to a period of fiercer competition in 2011, and now it is in a new phase of building a solid foundation.
China’s private banking industry has entered a critical stage of development. The key to future success in China’s private wealth market is to build a strong brand image, to provide a comprehensive service platform and to adopt greater professionalism. Ultimately, the goal of private banks should be to build deeper, stronger and long-lasting relationships with customers.
© Reprinted from Euromoney magazine February 2013 Copyright Euromoney magazine www.euromoney.com
10th Private banking survey – global results
10
Best private banking services overall2013 2012 % of total category score
1 2 UBS 7.88
2 1 Credit Suisse 6.86
3 4 JPMorgan 5.35
4 3 HSBC 5.09
5 5 Citi 4.92
6 6 Deutsche Bank 3.11
7 9 Merrill Lynch
Wealth Management 2.61
8 8 Santander 2.44
9 7 BNP Paribas 2.16
10 11 Goldman Sachs 1.86
11 13 Julius Baer 1.86
12 10 Barclays 1.82
13 15 Société Générale 1.54
14 14 ABN Amro 1.54
15 17 Morgan Stanley 1.50
16 23 Nordea 1.24
17 20 RBC 1.24
18 12 Pictet 1.22
19 26 China Merchants Bank 1.11
20 16 Banco Itau 0.97
21 27 Bank of China 0.91
22 29 SEB 0.87
23 33 BTG Pactual 0.84
24 22 Standard Chartered 0.84
25 38 Kotak Mahindra 0.84
26 21 Coutts 0.81
27 32 Danske Bank 0.79
28 35 Bank of Communications 0.74
29 25 ICBC 0.74
30 18 Rothschild 0.74
31 30 Lombard Odier Darier Hentsch 0.72
32 24 BBVA 0.70
33 52 China
Construction Bank 0.61
34 28 UniCredit 0.59
35 40 Wells Fargo 0.56
36 79 China Minsheng Bank 0.55
37 34 Scotiabank 0.53
38 36 Northern Trust 0.52
39 48 Shinhan 0.52
40 39 Commerzbank 0.52
41 45 Swedbank 0.51
42 41 HDFC 0.50
43 19 Credit Agricole Private Banking 0.47
44 Mitsubishi UFJ Merrill Lynch
PB Securities 0.46
45 43 ING 0.46
46 58 IIFL Private Wealth Management 0.43
47 37 Berenberg Bank 0.43
48 47 Hana Bank 0.42
49 57 Bradesco 0.42
50 54 DNB Bank 0.42
51 Banco do Brasil 0.41
52 46 Svenska Handelsbanken 0.40
53 Agricultural Bank of China 0.39
54 64 China CITIC Bank 0.39
55 59 Intesa Sanpaolo 0.38
56 SMBC 0.36
57 51 Raiffeisen Bank International 0.36
58 85 Sal Oppenheim 0.35
59 60 ANZ 0.33
60 86 Bank of Singapore (OCBC) 0.31
61 55 Metzler 0.30
62 Chinatrust Commercial Bank 0.30
63 Nomura 0.29
64 44 Credit Mutuel 0.29
65 65 Lazard 0.29
66 66 Sarasin 0.29
67 67 Bessemer 0.27
68 50 Rabobank 0.26
69 70 Carnegie 0.26
70 31 EFG 0.26
71 Kookmin Bank 0.26
72 82 ICICI Bank 0.25
73 Edmond de Rothschild Group 0.24
74 87 CIMB 0.22
75 Mizuho 0.22
76 Bankhaus Lampe 0.22
77 77 KBC 0.22
78 88 LGT 0.22
79 93 Woori Bank 0.22
80 Formuesforvaltning 0.22
81 Casa de Bolsa Banorte-Ixe 0.21
82 69 Erste Bank 0.21
83 72 CIBC 0.21
84 National Australia Bank 0.20
85 Safra 0.20
86 Westpac 0.20
87 Alfa Bank 0.19
88 78 C. Hoare & Co. 0.19
89 42 DBS Bank 0.19
90 68 UBP 0.18
91 BDO Private Bank 0.18
92 76 Van Lanschot 0.17
93 89 Vontobel 0.16
94 62 National Commercial Bank 0.15
95 Alandsbanken 0.15
96 OP-Pohjola Group 0.15
97 Akbank 0.15
98 Maybank 0.15
99 90 Commonwealth Bank 0.14
100 98= Banca March 0.14
©Reprinted from Euromoney magazine February 2013 Copyright Euromoney magazine www.euromoney.com 11
10th Private banking survey – regional results
BY REGIONAsiaBest private banking services overall2013 2012 % of total category score
1 2 UBS 6.65%
2 3 Citi 5.86%
3 1 HSBC 5.85%
4 4 Credit Suisse 4.71%
5 7 China Merchants Bank 3.88%
6 9 Bank of China 3.18%
7 10 Merrill Lynch
Wealth Management 2.99%
8 14 Kotak Mahindra 2.93%
9 13 Bank of Communications 2.61%
10 6 ICBC 2.60%
11 8 Standard Chartered 2.49%
12 5 Deutsche Bank 2.40%
13 11 JPMorgan 2.18%
14 22 China Construction Bank 2.15%
15 30 China Minsheng Bank 1.92%
16 20 Shinhan 1.82%
17 15 Barclays 1.78%
18 16 HDFC 1.76%
19 66 Mitsubishi UFJ Merrill Lynch
PB Securities 1.63%
20 25 IIFL Private
Wealth Management 1.52%
21 19 Hana Bank 1.48%
22 12 BNP Paribas 1.44%
23 49 Agricultural Bank of China 1.37%
24 27 China CITIC Bank 1.34%
25 48 SMBC 1.26%
26 28 ANZ 1.11%
27 32 Société Générale 1.08%
28 38 Chinatrust Commercial Bank 1.04%
29 33= Bank of Singapore (OCBC) 1.03%
30 46 Nomura 1.00%
31 18 Goldman Sachs 0.92%
32 40 Kookmin Bank 0.90%
33 31 ICICI Bank 0.87%
34 33= CIMB 0.79%
35 95= Mizuho 0.77%
36 21 Morgan Stanley 0.76%
37 23 ABN Amro 0.76%
38 36 Woori Bank 0.76%
39 41 Westpac 0.69%
40 44 National Australia Bank 0.68%
41 26 Julius Baer 0.66%
42 17 DBS Bank 0.65%
43 29 Coutts 0.62%
44 70 BDO Private Bank 0.61%
45 59 Maybank 0.52%
46 45 ING 0.49%
47 81 Taishin Financial 0.47%
48 35 Commonwealth Bank 0.47%
49 63 Bank Mandiri 0.43%
50 51 MUFG 0.43%
Relationship management2013 2012
1 3 Citi
2 2 UBS
3 1 HSBC
4 5 China Merchants Bank
5 7 Bank of China
6 4 Credit Suisse
7 20 China Construction Bank
8 6 Merrill Lynch Wealth Management
9 13 Bank of Communications
10 9 ICBC
11 8 Standard Chartered
12 29= China Minsheng Bank
13 11 JPMorgan
14 12 Deutsche Bank
15 29= ANZ
Privacy and security2013 2012
1 1 Credit Suisse
2 3 UBS
3 4 Citi
4 2 HSBC
5 6 Bank of China
6 13 China Merchants Bank
7 5 Deutsche Bank
8 11 Bank of Communications
9 14 China Construction Bank
10= 15 ICBC
10= 10 Merrill Lynch Wealth Management
12 23 Shinhan
13 9 JPMorgan
14 8 Standard Chartered
15 17 ANZ
16 7 BNP Paribas
17 16 HDFC
18 Mitsubishi UFJ Merrill Lynch
PB Securities
19 34 Kotak Mahindra
20 12 Julius Baer
21 35= China Minsheng Bank
22 38 Société Générale
23 41 China CITIC Bank
24 25 Hana Bank
25 46 Agricultural Bank of China
Range of investment products2013 2012
1 1 UBS
2 2 Citi
3 3 HSBC
4 11 China Merchants Bank
5 4 Credit Suisse
6 10 Kotak Mahindra
7 8 Bank of China
8 19 IIFL Private Wealth Management
9 5 Deutsche Bank
10 18 China Construction Bank
11 6 ICBC
12 13 Barclays
13= 12 Standard Chartered
13= 24 Shinhan
15 16 Bank of Communications
16 9 JPMorgan
17 66= Mitsubishi UFJ Merrill Lynch
PB Securities
18 25 HDFC
19 29 China Minsheng Bank
20 7 Merrill Lynch Wealth Management
21 28 China CITIC Bank
22 17 BNP Paribas
23 37 CIMB
24 22 Hana Bank
25 26 ICICI Bank
Range of advisory services2013 2012
1 1 HSBC
2 2 UBS
3 3 Credit Suisse
4 4 Citi
5 9 Bank of China
6 5 Kotak Mahindra
7 14 China Merchants Bank
8 7 Merrill Lynch Wealth Management
9 6 Deutsche Bank
10 62 Mizuho
11= 13 Bank of Communications
11= 23 China Minsheng Bank
13 15 China Construction Bank
14 26 SMBC
15 10 ICBC
16 29 China CITIC Bank
17 58 Bank of Singapore (OCBC)
18 95= Mitsubishi UFJ Merrill Lynch
PB Securities
19 8 JPMorgan
20 17 IIFL Private Wealth Management
21 11 Barclays
22 30 Société Générale
23 20 Shinhan
24 19 Hana Bank
25 18 BNP Paribas
Bespoke wealth planning2013 2012
1 2 UBS
2 4 Credit Suisse
3 3 Citi
4 1 HSBC
©Reprinted from Euromoney magazine February 2013 Copyright Euromoney magazine www.euromoney.com
10th Private banking survey – regional results
12
5 13 Kotak Mahindra
6 14 Standard Chartered
7 47= SMBC
8 7 Merrill Lynch Wealth Management
9 8 Bank of China
10 9 China Merchants Bank
11 22= China Construction Bank
12 10 ICBC
13 17= Bank of Communications
14 25 China CITIC Bank
15 11 Barclays
16 30 China Minsheng Bank
17 55 Bank of Singapore (OCBC)
18 16 Shinhan
19 52= Mizuho
20 6 Deutsche Bank
21 12 BNP Paribas
22 34 Société Générale
23 36 IIFL Private Wealth Management
24 5 JPMorgan
25 28= ABN Amro
Net-worth-specific servicesSuper affluent ($500,000 to $1mln)2013 2012
1 2 Citi
2 1 HSBC
3 6 Bank of China
4 13 Bank of Communications
5 3 Standard Chartered
6 4 HDFC
7 11 China Merchants Bank
8 15 UBS
9 14 China Minsheng Bank
10 7 ICBC
11 8 ICICI Bank
12 33 Agricultural Bank of China
13 12 China Construction Bank
14 58= Mitsubishi UFJ Merrill Lynch
PB Securities
15 30 Credit Suisse
16 18 Shinhan
17 26 Merrill Lynch Wealth Management
18 5 DBS Bank
19 16 Bank of Singapore (OCBC)
20 20 Kotak Mahindra
21 40 Chinatrust Commercial Bank
22 10 ANZ
23 21 China CITIC Bank
24 31 IIFL Private Wealth Management
25 24= Hana Bank
High net worth I ($1mln to $10mln)2013 2012
1 1 HSBC
2 2 Citi
3 3 UBS
4 4 Credit Suisse
5 10 China Merchants Bank
6 5 Standard Chartered
7 14 Kotak Mahindra
8 9 ICBC
9 7 Bank of China
10 8 Merrill Lynch Wealth Management
11 19= China Construction Bank
12 12 Bank of Communications
13 25 China CITIC Bank
14 29= China Minsheng Bank
15 60 Mitsubishi UFJ Merrill Lynch
PB Securities
16 6 BNP Paribas
17 16 ANZ
18 15 Barclays
19 27 HDFC
20 24 Shinhan
21 13 Deutsche Bank
22 31= ICICI Bank
23 22 IIFL Private Wealth Management
24 11 DBS Bank
25 41 National Australia Bank
High net worth II ($10mln to $30mln)2013 2012
1 4 Citi
2 2 UBS
3 1 HSBC
4 3 Credit Suisse
5 5 Merrill Lynch Wealth Management
6 6 JPMorgan
7 8 China Merchants Bank
8 26 China Minsheng Bank
9 18 China Construction Bank
10 9 Bank of China
11 15 Kotak Mahindra
12 7 Deutsche Bank
13 10 ICBC
14 11 Barclays
15 42 Nomura
16 40 SMBC
17 12 Goldman Sachs
18 16 Bank of Communications
19 25 Shinhan
20 14 Standard Chartered
21 20 IIFL Private Wealth Management
22 24 ANZ
23 19 Hana Bank
24 59= Mitsubishi UFJ Merrill Lynch
PB Securities
25 66= Agricultural Bank of China
Ultra high net worth (Greater than $30mln)2013 2012
1 1 UBS
2 2 Credit Suisse
3 5 JPMorgan
4 4 Citi
5 3 Goldman Sachs
6 6 HSBC
7 7 Merrill Lynch Wealth Management
8 8 Deutsche Bank
9 12 China Merchants Bank
10 13 Kotak Mahindra
11 9 Bank of China
12 28 China Minsheng Bank
13 10 ICBC
14 15 Barclays
15 17 Bank of Communications
16 16 China Construction Bank
17 34 Société Générale
18 14 Shinhan
19 21 Hana Bank
20 25 China CITIC Bank
21 56 Nomura
22 84= Mitsubishi UFJ Merrill Lynch
PB Securities
23 29= IIFL Private Wealth Management
24 59 Chinatrust Commercial Bank
25 11 Morgan Stanley
Equity portfolio management2013 2012
1 2 UBS
2 26 Nomura
3 1 Merrill Lynch Wealth Management
4 3 Citi
5 10 IIFL Private Wealth Management
6 6 Bank of China
7 4 HSBC
8 17 Bank of Communications
9 13 China Merchants Bank
10 8 Kotak Mahindra
11 12 Morgan Stanley
12 9 Goldman Sachs
13 7 Credit Suisse
14 88= Daiwa Securities
15 5 JPMorgan
16 15 China Construction Bank
17 14 HDFC
18 19 BNP Paribas
19 11 ICBC
20 24= China CITIC Bank
21 20 Shinhan
22 29 ABN Amro
23= 40 Agricultural Bank of China
23= 23 ICICI Bank
25 27 Standard Chartered
Fixed income portfolio management2013 2012
1 3 Citi
©Reprinted from Euromoney magazine February 2013 Copyright Euromoney magazine www.euromoney.com 13
2 1 UBS
3 2 HSBC
4 5 Deutsche Bank
5 31 Nomura
6 4 JPMorgan
7 7 Credit Suisse
8 11 China Merchants Bank
9= 6 Bank of China
9= 14 Kotak Mahindra
11 10 ICBC
12 17 Bank of Communications
13 12 Merrill Lynch Wealth Management
14 22 China Construction Bank
15 8 IIFL Private Wealth Management
16 9 BNP Paribas
17 55= Daiwa Securities
18 50= Mizuho
19 30 Bank of Singapore (OCBC)
20 16 Barclays
21 33 Agricultural Bank of China
22 28 Shinhan
23 15 Société Générale
24= 25 China Minsheng Bank
24= 18 HDFC
Foreign exchange2013 2012
1 1 Citi
2 2 HSBC
3 3 Deutsche Bank
4 5 Bank of China
5 4 UBS
6 6 Standard Chartered
7 7 Credit Suisse
8 10 Bank of Communications
9 14 ANZ
10 15 China Construction Bank
11 11= Barclays
12 18 China Merchants Bank
13 39 China CITIC Bank
14 8 ICBC
15 11= KEB
16 13 BNP Paribas
17 31= Westpac
18 42 ICICI Bank
19 20 Shinhan
20 38 HDFC
21 22 China Minsheng Bank
22 57= MUFG
23 37 Commonwealth Bank
24 40 Agricultural Bank of China
25 9 JPMorgan
Lending/financing solutions2013 2012
1 2 Citi
2 3 Deutsche Bank
3 1 HSBC
4 4 UBS
5 6 Standard Chartered
6 5 ICBC
7 13 Bank of Communications
8 7 Bank of China
9 16 China Merchants Bank
10 8 Credit Suisse
11 11 China Construction Bank
12 32 China CITIC Bank
13 48= MUFG
14 31 Société Générale
15 14 China Minsheng Bank
16 12 Barclays
17 10 BNP Paribas
18 66= SMBC
19 46= Westpac
20 26 HDFC
21 20= Kotak Mahindra
22 9 DBS Bank
23 97= Mizuho
24 17 ANZ
25= 24 ICICI Bank
25= 20= IIFL Private Wealth Management
Commodities investment2013 2012
1 2 Citi
2 1 Goldman Sachs
3 37 Agricultural Bank of China
4 12 IIFL Private Wealth Management
5 26 Nomura
6 3 UBS
7 30 Anand Rathi
8 6 Bank of China
9 7 Deutsche Bank
10 19 China Construction Bank
11 4 Morgan Stanley
12 13 Bank of Communications
13 17= Barclays
14 8 ICBC
15 5 HSBC
16 14 Kotak Mahindra
17 9 Credit Suisse
18 31 Macquarie
19 15= JPMorgan
20 10 China Merchants Bank
21 29 China Minsheng Bank
22 11 Merrill Lynch Wealth Management
23 21 ANZ
24 20 Shinhan
25 22 BNP Paribas
Precious metals investment2013 2012
1 2 Citi
2 4 HSBC
3 3 UBS
4 1 Goldman Sachs
5 6 Credit Suisse
6 5 ICBC
7 8 Deutsche Bank
8 7 Bank of China
9 11 China Merchants Bank
10 16 Barclays
11 12 Bank of Communications
12 13 China Construction Bank
13 9 JPMorgan
14= 22 China CITIC Bank
14= 27= China Minsheng Bank
16 15 Société Générale
17 19 Shinhan
18 48 Kotak Mahindra
19= 18 Merrill Lynch Wealth Management
19= 31 Nomura
21 10 Morgan Stanley
22 23 HDFC
23 32 BNP Paribas
24 42 CIMB
25 17 Standard Chartered
Real estate investment2013 2012
1 1 HSBC
2 6 IIFL Private Wealth Management
3 3= HDFC
4 2 Citi
5 3= Kotak Mahindra
6 13 China Construction Bank
7 5 ICICI Bank
8 8 Bank of China
9 10 UBS
10 26 Deutsche Bank
11 27 Bank of Communications
12 18 China Minsheng Bank
13 22 Standard Chartered
14 7 DBS Bank
15 9 JPMorgan
16 32 Barclays
17 16 Credit Suisse
18 23 Hana Bank
19 20 ANZ
20 14= China Merchants Bank
21 21 Shinhan
22 34 BNP Paribas
23 14= ICBC
24 40= Société Générale
25 24 Merrill Lynch Wealth Management
Private equity investment2013 2012
1 1 UBS
2 2 Goldman Sachs
3 3 Citi
4 7 Kotak Mahindra
©Reprinted from Euromoney magazine February 2013 Copyright Euromoney magazine www.euromoney.com14
10th Private banking survey – regional results
5 34= Nomura
6 6 JPMorgan
7 5 Credit Suisse
8 9 China Merchants Bank
9 12 ICICI Bank
10 19 Bank of Communications
11 31 Mitsubishi UFJ Merrill Lynch
PB Securities
12 4 Merrill Lynch Wealth Management
13 8 Bank of China
14 10 HSBC
15 20 IIFL Private Wealth Management
16 14 China Construction Bank
17 13 ICBC
18 27 Barclays
19 11 Morgan Stanley
20 23 China CITIC Bank
21 15 Deutsche Bank
22 80= SMBC
23 16 China Minsheng Bank
24 29 Agricultural Bank of China
25 21 Hana Bank
Structured products2013 2012
1 1 Citi
2 2 Deutsche Bank
3 3 UBS
4 5 Credit Suisse
5 6 Barclays
6 17 IIFL Private Wealth Management
7 4 HSBC
8 16 Bank of China
9 9 ICBC
10 15 Goldman Sachs
11 18 China Merchants Bank
12 21 Kotak Mahindra
13 32 Nomura
14 20 Bank of Communications
15 24 ABN Amro
16 7 Standard Chartered
17 12 JPMorgan
18 36= Agricultural Bank of China
19 11 China Construction Bank
20 8 Merrill Lynch Wealth Management
21 36= Mitsubishi UFJ Merrill Lynch
PB Securities
22 14 Morgan Stanley
23 13 BNP Paribas
24 23 Shinhan
25 10 Société Générale
Managed futures2013 2012
1 1 Citi
2 2 Goldman Sachs
3 3 UBS
4 23 Nomura
5 4 JPMorgan
6 10 Bank of China
7 13 Bank of Communications
8 12 China Construction Bank
9 6 Morgan Stanley
10 11 Deutsche Bank
11 9 Credit Suisse
12 8 HSBC
13 7 Merrill Lynch Wealth Management
14 18 ANZ
15 20= China Merchants Bank
16 34= Kotak Mahindra
17 28 Barclays
18 26 Mitsubishi UFJ
Merrill Lynch PB Securities
19 16 Shinhan
20 47 DBS Bank
21 14 Hana Bank
22 34= IIFL Private Wealth Management
23 45 HDFC
24= 33 China CITIC Bank
24= 17 China Minsheng Bank
Hedge fund investment2013 2012
1 1 Citi
2 2 UBS
3 6 Credit Suisse
4 4 JPMorgan
5 3 HSBC
6 7 Bank of China
7 5 Goldman Sachs
8 21 Nomura
9 12 Bank of Communications
10 11 Morgan Stanley
11 50 Mitsubishi UFJ Merrill Lynch
PB Securities
12 10 Merrill Lynch Wealth Management
13 8 Deutsche Bank
14 14 China Construction Bank
15 9 ICBC
16 42 Agricultural Bank of China
17 13 China Minsheng Bank
18 41 Daiwa Securities
19 17= Hana Bank
20 20 ANZ
21 39 Société Générale
22 17= Shinhan
23 52 National Australia Bank
24 19 Standard Chartered
25 33= ABN Amro
Luxury investment (non-art)2013 2012
1 1 UBS
2 3 Credit Suisse
3 2 Citi
4 7 BNP Paribas
5 6 Bank of China
6 13 Bank of Communications
7 5 China Merchants Bank
8 4 HSBC
9 17 Deutsche Bank
10 24 China Minsheng Bank
11 11 Julius Baer
12 18 Shinhan
13 27 Barclays
14 8= JPMorgan
15 14 China Construction Bank
16 12 Société Générale
17 26 Standard Chartered
18 28 China CITIC Bank
19 41 Westpac
20 34 Chinatrust Commercial Bank
21 10 Coutts
22 25 Woori Bank
23 8= ICBC
24 32 Agricultural Bank of China
25 46 National Australia Bank
Family office services2013 2012
1 1 UBS
2 4 Kotak Mahindra
3 2 Credit Suisse
4 8 IIFL Private Wealth Management
5 9 Bank of China
6 18 Bank of Communications
7 3 HSBC
8 5 Citi
9 23 Agricultural Bank of China
10 12 China Merchants Bank
11 24 China Construction Bank
12 6 Merrill Lynch Wealth Management
13 7 JPMorgan
14 20 Hana Bank
15 61 Myer Family Office
16 15 ANZ
17 10 ICBC
18 37= SMBC
19 17 Barclays
20 14 Julius Baer
21 31 National Australia Bank
22 19 Shinhan
23 52 Lombard Odier Darier Hentsch
24 41= Kookmin Bank
25 21 Standard Chartered
Inheritance and succession planning2013 2012
1 3 UBS
2 1 HSBC
3 2 Credit Suisse
4 10 Bank of China
5 4 Citi
©Reprinted from Euromoney magazine February 2013 Copyright Euromoney magazine www.euromoney.com 15
6 5 Merrill Lynch Wealth Management
7 46 SMBC
8 23 Bank of Communications
9 6 Barclays
10 15 Kotak Mahindra
11 11 IL&FS
12 12 China Construction Bank
13 7 JPMorgan
14 41 Mizuho
15 33 China CITIC Bank
16 Mitsubishi UFJ Merrill Lynch
PB Securities
17 13 China Merchants Bank
18 20 Hana Bank
19 14 ICBC
20 52= Nomura
21 28 China Minsheng Bank
22 36 Agricultural Bank of China
23 22 ABN Amro
24= 8 IIFL Private Wealth Management
24= 31 MUFG
Trust services2013 2012
1 2 UBS
2 4 Citi
3 3 Credit Suisse
4 1 HSBC
5 5 IL&FS
6 7 ICBC
7 12 Bank of China
8 14 China Merchants Bank
9 8 JPMorgan
10 10 Kotak Mahindra
11 11 Merrill Lynch Wealth Management
12 9 IIFL Private Wealth Management
13 24 Bank of Communications
14 43= Mizuho
15= 6 Barclays
15= 53= Agricultural Bank of China
17 34 SMBC
18 36= MUFG
19 20= Hana Bank
20 19 Shinhan
21 27 Chinatrust Commercial Bank
22= 22= China Minsheng Bank
22= Chuo Mitsui
24 20= China CITIC Bank
25= 13 China Construction Bank
25= 28 Woori Bank
Tax guidance and services2013 2012
1 2 UBS
2 1 HSBC
3 3 Credit Suisse
4 8 Bank of China
5 10 Ernst & Young
6 9 PricewaterhouseCoopers
7 5 KPMG
8 6 Bank of Communications
9 7 ICBC
10 12 China Merchants Bank
11 27 Kotak Mahindra
12 15 China Construction Bank
13 52 Mizuho
14 4 Citi
15 34 Barclays
16 17 Hana Bank
17 33 IIFL Private Wealth Management
18 26 China CITIC Bank
19 38 Nomura
20= 30 Agricultural Bank of China
20= 23= China Minsheng Bank
22 19 ANZ
23 41 SMBC
24 53 Westpac
25 11 JPMorgan
Offshore services2013 2012
1 1 HSBC
2 2 UBS
3 3 Citi
4 5 Bank of China
5 4 Credit Suisse
6 22 Bank of Communications
7 7 Standard Chartered
8 8 Barclays
9 16 China Construction Bank
10 6 Deutsche Bank
11 11 JPMorgan
12 10 ICBC
13 31 Julius Baer
14 12 BNP Paribas
15 9 KEB
16 24 China Merchants Bank
17 25 IIFL Private Wealth Management
18 13 Merrill Lynch Wealth Management
19 50 Nomura
20 21 Shinhan
21 46 Lombard Odier Darier Hentsch
22 36 Agricultural Bank of China
23 49 Kotak Mahindra
24 20 Coutts
25 Bank of East Asia
Corporate advisory for private banking clients2013 2012
1 1 Citi
2 4 HSBC
3 2 Credit Suisse
4 8 ICBC
5 3 UBS
6 9 Bank of China
7= 11 Deutsche Bank
7= 62= SMBC
9 7 Goldman Sachs
10 10 China Construction Bank
11 5 Standard Chartered
12 29 Nomura
13 17 Bank of Communications
14 6 JPMorgan
15 12 Kotak Mahindra
16 16 Barclays
17 40 Agricultural Bank of China
18 15 China Merchants Bank
19 54 Mizuho
20 Chinatrust Commercial Bank
21 13 Merrill Lynch Wealth Management
22= 18 IIFL Private Wealth Management
22= 62= MUFG
24 20 Hana Bank
25 14 Morgan Stanley
Islamic banking services2013 2012
1 15 Bank of Communications
2 1 HSBC
3 4 CIMB
4 7 Bank of China
5 3 Maybank
6= 24 China CITIC Bank
6= 10 China Construction Bank
6= 14 China Merchants Bank
9 6 UBS
10 8 Arab Bank
11 22 China Minsheng Bank
12 26 Credit Suisse
13 27 Bank Mandiri
14 5 ICBC
15 60 BNP Paribas
16 19 Agricultural Bank of China
17 Alliance Bank
18 9 Standard Chartered
19 2 Citi
20 13 Abu Dhabi Commercial Bank
Philanthropy services2013 2012
1 1 UBS
2 2 Credit Suisse
3 3 HSBC
4 6 Bank of China
5 4 Citi
6 12 Bank of Communications
7 5 JPMorgan
8 18= Deutsche Bank
9 21 China CITIC Bank
10 30 Barclays
11 41 Agricultural Bank of China
©Reprinted from Euromoney magazine February 2013 Copyright Euromoney magazine www.euromoney.com16
10th Private banking survey – regional results
12 28 China Minsheng Bank
13 15 ANZ
14 8 China Merchants Bank
15 23 Merrill Lynch Wealth Management
16 35= Standard Chartered
17 25= Julius Baer
18 20 Shinhan
19 14 ABN Amro
20 16 Société Générale
21 32 Commonwealth Bank
22 10 China Construction Bank
23 18= BNP Paribas
24 7 ICBC
25 46 Westpac
Yacht and aircraft fi nancing2013 2012
1 2 UBS
2 4 Bank of China
3 8 Deutsche Bank
4 1 Citi
5 14 Bank of Communications
6 22 China Construction Bank
7 12 China Merchants Bank
8 29 Agricultural Bank of China
9 6 ICBC
10 5 Credit Suisse
11 7 JPMorgan
12 28 Société Générale
13 11 Standard Chartered
14 34= Coutts
15 10 Barclays
16 13 ANZ
17 15 China Minsheng Bank
18 51 Chinatrust Commercial Bank
19 3 HSBC
20 9 BNP Paribas
Art, banking and numismatics2013 2012
1 1 UBS
2 6 Bank of China
3 5 Citi
4 3 Credit Suisse
5 11 Bank of Communications
6 2 HSBC
7 19 Coutts
8 13 JPMorgan
9 16 China Minsheng Bank
10 10 ANZ
11 8 China Construction Bank
12 20 Deutsche Bank
13 12 ABN Amro
14= 18 China CITIC Bank
14= 4 China Merchants Bank
16 14= Julius Baer
17 23 Société Générale
18 33 Westpac
19 9 BNP Paribas
20 7 ICBC
21 21= Shinhan
22 69= National Australia Bank
23 28 Agricultural Bank of China
24 44 Barclays
25 25 Goldman Sachs
Specialized servicesEntrepreneurs2013 2012
1 2 Citi
2 1 HSBC
3 12 China Merchants Bank
4 3 UBS
5 6= Bank of China
6 29 Nomura
7 6= Kotak Mahindra
8 4 Credit Suisse
9 13 Bank of Communications
10 8 Merrill Lynch Wealth Management
11 5 Standard Chartered
12 11 IIFL Private Wealth Management
13 10 Deutsche Bank
14 32 China CITIC Bank
15 14 China Minsheng Bank
16 9 ICBC
17 19 Barclays
18 45 Agricultural Bank of China
19 52 SMBC
20 15 JPMorgan
21 18 China Construction Bank
22 84= Bank Central Asia
23 26= Hana Bank
24 37 Mitsubishi UFJ Merrill Lynch
PB Securities
25 Daiwa Securities
Corporate executives2013 2012
1 1 Citi
2 2 HSBC
3 6 HDFC
ChinaBest private banking services overall2013 2012
1 2 China Merchants Bank
2 3 Bank of China
3 4 Bank of Communications
4 1 ICBC
5 7 UBS
Relationship management2013 2012
1 1 China Merchants Bank
Privacy and security2013 2012
1 1 Bank of China
Range of investment products2013 2012
1 3 China Merchants Bank
Net-worth-specifi c servicesSuper affl uent2013 2012
1= 2 Bank of China
1= 4 Bank of Communications
High net worth I2013 2012
1 1 China Merchants Bank
High net worth II2013 2012
1= 1 China Merchants Bank
1= 7= China Minsheng Bank
Ultra high net worth2013 2012
1 3 UBS
Lending/fi nancing solutions2013 2012
1 1 ICBC
Commodities investment2013 2012
1 10= Agricultural Bank of China
Family offi ce services2013 2012
1= 2 Bank of China
1= 4 UBS
©Reprinted from Euromoney magazine February 2013 Copyright Euromoney magazine www.euromoney.com 17
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
Western Europe North America Asia Latin America
$ B
ln
Assets Under Management by regions 2009-2012
2009
2010
2011
2012
Total client (non-institutional) AUM by region 2009-2012
Assets Under Management - Asia 2009-2012
$821.81 $957.23
$1,542.27 $1,707.12
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800
16%
61%
11%
2009 2010 2011 2012
$ B
ln
Total client (non-institutional) AUM - Asia 2009-2012
786.06
508.82
324.82
103.36 68.53
0
100
200
300
400
500
600
700
800
900
China Hong Kong Brazil Korea Taiwan
$ B
ln
Total Client (non-institutional) AUM - Selected countries
Total client (non-institutional) AUM - Selected countries
10th Private banking survey – data
©Reprinted from Euromoney magazine February 2013 Copyright Euromoney magazine www.euromoney.com18
-10.0%
-5.0%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
Central & Eastern Europe
Latin America Asia Africa North America
Nordic & Baltics
Western Europe
Middle East
Caribbean
%
Annual AUM Growth Rate by Region 2012
Annual AUM growth rate by region 2012
23.7
20.8 18.9
14.0
0
5
10
15
20
25
Brazil India China United Arab Emirates
%
Annual % AUM Growth Rate 2011-2012 - Brazil/ India/China/UAE
Annual % AUM growth rate 2011-2012 - Brazil/India/China/UAE
7432
3270 1589 368
0
2,000
4,000
6,000
8,000
China Brazil India Russia
No. of Private Banking Employees - BRIC
No. of private banking employees - Bric
PB Survey and Charts FINAL FINAL.indd 84 04/07/2013 16:13
©Reprinted from Euromoney magazine February 2013 Copyright Euromoney magazine www.euromoney.com 19
5702.27
1678.10 617.00
273.00
0
2,000
4,000
6,000
China Korea Hong Kong Taiwan
$ M
ln
Net Income of Private Banks in China/Korea/HK/Taiwan
Net income of private banks in China/Korea/HK/Taiwan
65.0
35.2 30.3
10.0
-8.3
-20
0
20
40
60
80
India Brazil China Turkey Russia
%
% Change in Net Income 2011-2012 - India/Brazil/
China/Turkey/Russia
% change in net income 2011-2012 - India/Brazil/China/Turkey/Russia
207.5
57.7 15.0 8.8 2.9
-28.0 -41.0
-100
-50
0
50
100
150
200
250
China Japan Malaysia Korea Taiwan Singapore
Hong Kong
%
% Growth in PB Net Income 2011-2012 - Asia
% growth in PB net income 2011-2012 - Asia
10th Private banking survey – data
©Reprinted from Euromoney magazine February 2013 Copyright Euromoney magazine www.euromoney.com20
20.5
16.1 15.5
8.7
0
5
10
15
20
25
China India Brazil Russia
%
% Growth in absolute number of PB clients y-o-y 2011-2012 - BRIC
% growth in absolute number of PB clients y-o-y 2011-2012 - Bric
41.8%
38.7%
21.0%
0
5
10
15
20
25
30
35
40
45
2010 2011 2012
%
% Growth in Gross Revenue - Asia 2010 - 2012
% Growth in gross revenue - Asia 2010 - 2012
60.2 56.8
17.6 15.5
6.9 4.6
2.2
0
10
20
30
40
50
60
70
China Japan Malaysia Taiwan Korea Singapore Hong Kong
%
% Growth in Gross Revenue 2011-2012 - Asia
% growth in gross revenue 2011-2012 - Asia
PB Survey and Charts FINAL FINAL.indd 86 04/07/2013 16:13
C
M
Y
CM
MY
CY
CMY
K
建行A4广告.pdf 2013.7.4 12:20:39 PM
It is the world’s fastest-growing millionaires’ club. While the rest of the world stumbles, China strides ahead; the number of high-net-worth individuals (HNWIs) with at least RMB10 million in investable assets has more than doubled in the past five years.
Today, China is home to more than 700,000 HNWIs – 40,000 of whom are ultra-HNWIs with more than RMB100 million, according to the China Private Wealth Report 2013 by China Merchants Bank and global business consultancy Bain & Company.
Wealth isn’t just growing – it’s spreading too, the report found. There are now 20 provinces in China with HNWI populations exceeding 10,000, five more than in 2010, with Inner Mongolia and Chongqing among the latest to count their HNWIs in five figures.
The rate of wealth expansion across China is staggering. In a recent interview, Nick Yim, head of private wealth management in China for Goldman Sachs, declared the present era “a golden period” for private banking in China.
Keeping pace?But are China’s private bankers ready and able to capitalize on this apparent golden age? In a young and undeveloped market with a shortage of talent, can they keep pace with the increasingly sophisticated expectations of their HNWI customers?
A separate study by China
Minsheng Banking Corporation and McKinsey and Company found four in 10 clients were less than happy with the service they received and would invest much more with private banks if they could find one they liked and trusted enough.
China, it appears, doesn’t yet have a wealth management industry to match the amount of wealth it needs to manage – and the foremost challenge to private banks in the years ahead is likely to be bridging the gap between expectation and delivery.
In fairness, the industry is a victim of its own success. A microcosm of the speed of
development of China’s economy as a whole, the private banking industry has been required to develop and mature in years when the same process took decades in countries overseas.
The first private banks only appeared in 2008 – and one of the most striking features of the Bain report is the way in which the investment priorities of HNWIs have evolved and changed since then. Wealth creation, the number one wealth management objective in the inaugural 2009 survey, dropped to fourth place in the 2013 report, behind quality of life, children’s education and – at the top of the list – wealth preservation, cited by 30% of respondents.
The shift in priorities in part appears to reflect a growing cautiousness in response to the global financial problems and the recent economic slowdown in China. However, it also reflects a particular stage of life for many of the country’s first generation of entrepreneurs.
“Many HNWIs have established their businesses and are now focused on ensuring the future living standards for themselves and their family,” the report notes. “To that end, preservation and stable increase of wealth has become increasingly important.”
Sameer Chishty, global head of wealth management and private banking practice for Bain, said the economic slowdown and market volatility had played a part in changing the investment
preferences of HNWIs in China. “They are relatively new investors,” he said. “Chinese wealth is new and investment exposure is new so they are seeing that what goes up often comes down.
“Another factor is succession planning. This is one of the youngest generations of wealthy people in history, certainly in terms of the amount of wealth they have accumulated at a relatively young age. They are beginning to think about succession and their families.”
Looking after the familyInterestingly, at a time when China’s new president is clamping down on corruption and lavish lifestyles among public figures, the change in attitude in some cases has been prompted by a desire to “clean up” personal lives, he argued.
“Many of them have complicated personal lives with different children from different marriages, and there have been some very high-profile family disputes,” he said. “That has driven them to ask themselves: ‘What would happen if I moved on, or if I died, and I didn’t provide some clarity to my successors?’”
The report found that a third of HNWIs and a half of ultra-HNWIs are now considering or conducting wealth inheritance planning. More than half of ultra-HNWIs have expressed an interest in establishing family trusts, while 15% have done so or started to do so.
WEALTHIER, WISER CLIENTS TEST China’s banksThe number of high-net-worth individuals in China has more than doubled since 2008 – but can the country’s private banks keep pace with their increasingly sophisticated demands and expectations?
By Simon Parry
“China, it appears, doesn’t yet have a wealth management industry to match the amount of wealth it needs to manage”
This shift towards a more mature and prudent investment philosophy has seen the percentage of HNWIs pursuing moderate and low-risk investment strategies going from fewer than 80% in 2009 to more than 90% in 2013.
China’s rich are a homogenous lot, according to the China Minsheng/McKinsey study. They are mostly men aged between 40 and 60 and mostly entrepreneurs or corporate executives. Reflecting the wave of entrepreneurism that swept China as it embraced Deng Xiaoping’s economic liberalization, entrepreneurs made up 40% of the HNWIs interviewed and also comprised the biggest percentage of individuals with assets of over RMB30 million.
Their common profile may justify the view of the ‘golden period’ for private banks in China – but their opinions also suggest strongly that the business isn’t going to fall into the laps of private banks: They are going to have to work hard for it.
Nearly 40% of respondents said they were not satisfied or indifferent to the level of private banking service they received, and nearly 50% said they allocated 20% or less of their investible assets to their primary bank.
More than half of respondents in the McKinsey survey said they would up their allocation to 40% or more of their investible assets
if the bank “could fully satisfy their personal financial needs”, the report found.
More surprising is the widespread lack of awareness of private banks among HNWIs in China. Forty five per cent of respondents said they had only a “basic understanding or less” or private banking services.
Those who had used private banks were underwhelmed. “Some interviewees are not even aware that banks offer a service beyond VIP banking,” the report noted. “Some interviewees claim that since becoming a private banking customer, the service experience is not significantly different from retail [banking].”
Not just about productsOne of the problems is that private banks in China have so far been too product-oriented, Bain’s Chishty argued. “It’s been about coming up with the coolest product that promises you the highest returns and that’s not what HNWIs want,” he said.
“They are looking for more transparency with products. In the future, successful private banks will not just be about more and more products. Successful private banks will be offering value added services – advice and guidance type services.”
What HNWIs want is a relationship manager (RM) or adviser who can tell them what
overseas school to send children to, and what hospital to send a sick relative to in Thailand, Singapore or the US, he suggested.
Private banks were also “missing a trick” by concentrating too much on establishing overseas office for wealthier clients. “Most of the Chinese wealth is within China and will remain in China,” Chishty said. “It needs to be serviced in China by an RM who can actually give them advice and guidance. This is the challenge for the banks.”
One of the biggest players in the market is ICBC Private Banking, which since 2008 has offered a service to clients with investible assets of RMB8 million upwards and now has 36 centres in China as well as bases in Hong Kong, Europe and Singapore.
Acknowledging the rapid pace of change in the market, a spokesperson said: “When private banking was first introduced into China, most of our customers had little knowledge about how private banking services can help them in managing their wealth. Since the global financial crisis in 2008, private banking customers are more willing to accept steady and moderate products with controlled risks. Our key initiative last year was to develop pooled investment portfolios under different investment strategies as vehicles for client with similar preference to maximize their demands for liquidity, security and profitability.”
Foreign banks, it seems, are at a distinct disadvantage. Most HNWIs are businessmen and entrepreneurs with career-long financial relationships with Chinese banks.
With around 50% of Chinese wealth still not professionally managed, however, it is a hard challenge to ignore. Earlier this year, the prestigious British private bank Coutts announced it was doubling its Asian staff to try
to reach into the Chinese market.Michael Blake, general manager
of Coutts Asia, described the gap in the market as a “massive opportunity”. However, Chishty predicted: “Most of the opportunity for foreign banks will remain offshore.”
For every private bank in China, the incentives to get their services right are obvious and vast. The McKinsey report predicts that by 2015, China will be home to 2 million HNWIs and 130,000 ultra-HNWIs – all with money to invest and inheritances to safeguard.
It is a market awash with extravagant levels of capital and potential. The golden age of private banking in China may be some way off yet in terms of service standards – but the prizes for the banks that find a way to meet clients’ demands could be glittering indeed.
Sameer Chishty,Bain
“This is one of the youngest generations of wealthy people in history, certainly in terms of the amount of wealth they have accumulated at a relatively young age. They are beginning to think about succession and their families”
DBS-205-T13 [email protected] 1 1/7/13 10:33 AM