Published by Hubbis – 21st May 2019
Prince Max von und zu Liechtenstein, a member of European royalty and chief executive of LGT Group, says it is inevitable the number of private banks in Asia is destined to reduce.
He pointed to the fact that private banks in the Asia Pacific region are having a difficult time due to escalating operating expenses and coping with their traditional client base changing dramatically in both age and outlook.
Asia Pacific led the world in private wealth accumulation in 2018, with nearly double-digit growth at 9.5 percent, compared with 5.6 percent in North America, 3.5 percent in western Europe and 6 percent on average globally. That’s according to the latest wealth report by Boston Consulting Group, which has followed the sector for the past 17 years.
The LGT Group CEO added, “The number of sizeable private banks, say, large enough for a newspaper to cover them, will come down.” LGT entered the private banking business in Asia in 1999, and the acquisition in 2009 of Dresdner Bank (Switzerland) was followed by a selective private banking portfolio from HSBC Private Bank Suisse and a majority stake in London-based wealth management company Vestra Wealth.
LGT made its China ambitions clear when it bought Dutch bank ABN Amro’s private banking arm in Asia and the Middle East in December 2016. Underlining the trend, Singapore’s DBS acquired Australia and New Zealand Banking Group’s wealth business in five Asian markets, in October 2016. Meanwhile, Geneva-based Union Bancaire Privée had already taken over private bank Coutts International from the Royal Bank of Scotland in March 2015, a deal that boosted the Swiss bank’s assets in Asia from USD1 billion to USD11 billion.
AuM at LGT Bank Asia has grown beyond USD50 billion this year, after the completion of its deal with ABN Amro, which came with USD20 billion in assets. LGT Group has also aggressively pursued a younger client base and is tailoring strategies to their needs, seeing that approach as the key to gaining market share in Asia.
“The share of young wealthy clients in Asia is higher than in Europe. Some of the big fortunes now are being created by entrepreneurs who are still relatively young,” said Prince Max. “You need to speak their language.”
