Boutique Wealth Managers are gaining traction among Asia's rich, and private banks are increasingly reliant on them for growing assets.
Boutiques, or so-called external asset managers (EAMs), serve mainly small-and-mid-level business owners and executives but are typically out of reach for private banks. As a result, more and more private banks are leaning on such boutique managers to boost their assets in a region which is seeing the fastest billionaire population growth in the world.
«EAM accounts are relatively low-maintenance accounts for private banks,» said Alexander Florsheim, chief investment officer at Carret Private, which manages more than $1 billion in assets in Asia, and was quoted in «Reuters». «Private banks don’t have to spend much and pay incentives to in-house relationship managers for originating the business,» Florsheim added.
Room To Grow
While it is a long-established practice in developed wealth centers such as Switzerland and London which houses over 2,000 EAMs each, official figures suggest that Asia has scope to increase the current pool of less than 200 such boutique wealth managers.
The trend is gaining momentum in Asia at a time when the overall individual wealth is growing. In fact, Asia-Pacific saw total household wealth grow 3 percent last year to $114.6 trillion from a year ago, making it the largest wealth region globally, according to a Credit Suisse global wealth report.
In February this year, Schroders Wealth Management said it was acquiring the wealth management business of Singapore-based independent asset manager Thirdrock Group, which had $3 billion of assets.
