HSBC made the decision to combine its investment and product teams in Asia a few years ago to serve clients across the full wealth continuum. The merged structure has paid dividends via new assets.
Three years ago, HSBC decided to create an integrated investment and products team called Investment and Wealth Solutions (IWS) to serve private clients across the board from the mass market all the way to the ultra-high net worth and family office segment. This was in line with the broader structure that placed the overall retail and private banking business under a single unit called Wealth and Personal Banking (WPB).
«I think it has been one of the single most important factors and differentiators on success,» said APAC head of IWS Stefan Lecher during a media roundtable attended by finews.asia, highlighting significant «cross-fertilization» across segments.
AUM Growth
HSBC shared various highlights which it attributed in part to the positive effects from an integrated approach from the IWS team.
In Asia, the bank added $150 billion in net new invested assets in the last three and a half years since Lecher joined with invested assets growing 21 percent year-on-year in the second quarter of 2024 to reach a total of $607 billion. During the quarter, wealth fee and other income also increased by 26 percent.
Capital markets revenue registered «strong double-digit growth» in the first half of this year. Assets under management (AUM) in the bank’s «Prism Advisory» offering – a portfolio-based investment service that leverages portfolio and risk analytics technology from BlackRock – also tripled during this period.
Liberalizing Product Access
One key driver of growth has been the liberalization of access to products that were once only accessible by the bank’s ultra-rich clients. For example, alternatives saw its best half ever in Asia with double-digit AUM growth. And within open-ended private market funds, the majority of clients were first-time investors in the asset class.
«We have brought so many solutions that were exclusive to private banking onto the retail platform,» explained Lecher. «We've also brought a lot of technology [from retail banking] up to private banking.»
One Kitchen, Many Restaurants
Despite the advantages of a combined product team, there are some challenges involved. Lecher describes IWS as a kitchen and the various client coverage teams as restaurants, each with their own demands.
«As your front office teams are separate, what is a bit challenging sometimes is they might get the feeling you're not doing enough for them,» he shared. «Everybody wants to have the kitchen just [serve] one restaurant. And I say no, the kitchen is much better if it actually stores the product for everybody and packages it the right way.»
