The Swiss investment bank hopes to cash in on Asia's growing wealth amidst global headwinds and has its sights on China, said its Asia Pacific chief.
UBS hopes to grow its wealth management business in China, and as the country slowly opens up its financial sector, it could soon challenge local players that currently dominate the market, said Edmund Koh, President, UBS Asia Pacific, who spoke to Christine Tan in the latest episode of «Managing Asia», broadcast on CNBC on 24 May.
«I think China is going through the same process Hong Kong and Singapore went through over the last 20 years but they will accelerate given the advancement of technology and also the internationalization of the Chinese population. So currently, it's dominated by the local banks through more of retail wealth management but not the sophistication that is needed for legacy planning,» said Koh.
«I think amongst the foreign banks, to be number one is there for the taking because nobody is really dominating that area,» he added, noting «For China, you have to be patient.»
Growth and Inflows in Asia
Under his leadership, UBS' invested assets in the region have grown by about 70 percent, Koh estimated. UBS crossed the $400 billion mark for invested assets in Asia Pacific in the first quarter of 2019, making it the first wealth manager in the region to reach this milestone.
The bank saw strong growth in Asia, with record net new money inflows of $16.3 billion in the first quarter of 2019, a $10 billion jump from the year before, where it saw inflows of $6.3 billion in the same period, and just short of the $17.2 billion it brought in over the whole of 2018.
He said hopes his team, under the leadership of wealth management Asia Pacific co-heads Amy Lo and August Hatecke, will soon be able to reach $500 billion. «I would tell them if they are any good, it should be less than two years. That's how long I would give it myself,» Koh said.
Purpose-Driven
Managing the UBS' 23,000 employees in the region and maintaining its position as the leading private bank in the region is no easy task, but Koh said his secret is self-belief, energy and purpose.
«My purpose, along with my colleagues, has been very clearly articulated. If we don't do well, people will be unemployed because we manage some of the biggest families that are huge employers around the region. That drives me. It's not the 50 basis points of loan spread or 75 basis points of investment. That is just part of the process.»
Koh, who in October 2018 became the first Singaporean to hold the position of president of UBS Asia Pacific, was previously the bank's head of wealth management for Asia Pacific and country head Singapore. He joined UBS in 2012 as head of wealth management for Southeast Asia, following stints at Taiwan's Ta Chong Bank, where he served for four years as president and director, and DBS Banks, where he was managing director and regional head, consumer banking from 2001 to 2008.
