Vontobel's Chief Executive in Asia for private banking tells finews.asia why he isn't hidebound to recruiting, why lavish offices don't always wash with the super-rich and what sort of deals the Swiss bank would consider.
One of Asia's most respected wealth management executives, Hong Kong native Alex Fung moved to Swiss bank Vontobel three years ago, shortly before his longtime previous employer Société Générale sold its Asian wealth arm to Singapore's DBS.
Last week, Fung lamented to finews.asia (click here to read) that his industry hasn't yet earned the status that family doctors enjoy, saying there is still too little differentiating private bankers for clients.
However, clients in Asia are growing weary of simply trading and racking up transactions, and are increasingly receptive to an objective, advice-based private bank, according to Fung.
The former investment banker turned wealth manager sat down with finews.asia and finews.asia-TV (click here to view) in Zurich to discuss his recruiting plans, salary packages for Asia private bankers, and mergers and acquisitions.
Alex Fung, you share office space in Hong Kong with other Vontobel units and you don’t have your own personal office. Quite a contrast to the lavishness at some private banks in the region.
I don’t think we need that. We are selling wealth and asset management, not real estate and interior design. Don’t underestimate the clients: by definition, high net worth individuals are successful. They can see through the lavishness, and they know they will be paying for it in some way.
How quickly are you adding private bankers?
It’s tough for the entire industry because we’re in perfect imbalance: everybody wants to grow, so demand is going up but supply is simply not growing enough to meet it. People are also not changing jobs that often, which is the right approach but nevertheless this makes the market less liquid.
Pay has remained persistently high for private bankers.
I think salaries will continue to stay high until this imbalance of supply and demand is remedied. So far I don’t see that: demand still completely outstretches supply, so salaries will stay high unfortunately.
What does that mean for your hiring targets?
We don’t have a specific target. A big part of my job to grow organically by hiring bankers and attracting clients. We are constantly looking to attract and recruit talents, but I have a selective approach to hiring. I want to have the right fit, since we have a different business model than other competitors. Some banks have a habit of telling the press they will hire 50 private bankers this. I am sorry to say there are probably fewer than 50 senior private bankers moving in a year in the whole Asian industry, so it’s a tall commitment to say that.
Would you look at M&A to grow, as Vontobel has done elsewhere?
We do have an interest and appetite. If we see the right profile, the right partner, and the right deal, we will seriously consider it of course.
Are prices for private banking assets still frothy?
For us it’s not so much about the price as whether it’s a good fit for us or not. All the recent deals and consolidation basically hinge on a regional or local presence and platform from universal banks. That’s not a good fit for us.
Alex Fung has been Vontobel's Chief Executive for private banking in Asia-Pacific since 2014. Prior to joining the Swiss bank, he was the chairman of Société Générale's Asia activities and Chief Executive in Hong Kong. He began his career with Canadian Imperial Bank of Commerce, or CIBC, as a bond trader in London before eventually moving into wealth management in Asia for the Toronto-based lender. Fung is based in Hong Kong.
