UOB-Kay Hian is optimistic about the prospects of traditional brokerage noting that people are still willing to pay «a few basis points» for the human touch.
UOB-Kay Hian added 100 remisiers earlier this month from DBS Vickers. The new additions, which are not full-time staff and paid by commission, boost the firm’s total network of representatives to 820.
Whilst the move counters broader ongoing trends of lower fees and robe-advisory the firm remains confident that demand for human touch remains in the market.
«There is a lot of digitization but the human touch is still very important,» said Esmond Choo, senior executive director at UOB-Kay Hian in a «Bloomberg» report, stressing that there are customers willing to pay a «few basis points» for such services.
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UOB-Kay Hian’s stock fell 30 percent from its high in February 2013 and has remained flattish year-to-date. «The market has so far not appreciated our model,» Choo said, noting that «The idea is to do as much business as possible [with the remisier network].»
Nonetheless, the firm stands behind its decision in exploring the opportunity for accelerated growth under the traditional model and intends further momentum.
«DBS’s decision offered a good opportunity to scale up. It takes a lot of time to build a base of 100 remisiers,» Choo said, adding that UOB-Kay Hian was still open to hiring more remisiers and acquiring smaller brokers.
