BANKERS WARN ON SINGAPORE SHAKE-UP

by **Darkmen** Sun Sep 01, 2013 2:25 am

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Intense competition, a tendency for wealthy Asians to use multiple private bankers and high staff costs are likely to force consolidation in the wealth-management business in [You must be registered and logged in to see this link.] and could push operators out of business, top private bankers have warned.

Signs of competitive strain in one of Asia’s biggest wealth management hubs stand in contrast to an image of rising wealth as the number of multimillionaires grows faster in the region than elsewhere.

Bankers say that even as assets under management are [You must be registered and logged in to see this link.]fast in Singapore, that is not translating into profits for many banks that have rushed to Singapore to tap growing wealth.

“Many foreign banks came in without giving enough thought about the sustainability of the business, the regulatory environment and competitiveness from established players as well as local banks aspiring to be top-end wealth managers,” said [You must be registered and logged in to see this link.], chairman of [You must be registered and logged in to see this link.] Private bank and co-chair of the [url=http://www.irishtimes.com/search/search-7.1213540?tag_company=Singapore Private]Singapore Private Banking[/url] Industry Group.

Private bankers say cost/ income ratio in Singapore is higher than in [You must be registered and logged in to see this link.], as an influx of banks chasing business has collided with a shortage of qualified “relationship managers” to woo clients.

[You must be registered and logged in to see this link.] under management grew 17 per cent in [You must be registered and logged in to see this link.] last year, double the rate for [You must be registered and logged in to see this link.] or western Europe, according to consultancy McKinsey but profit margins among private banks in Asia were the lowest of any region except for [You must be registered and logged in to see this link.].

With Europe in the doldrums, Singapore and [You must be registered and logged in to see this link.] offer wealth managers one of few growth avenues, as the number of multimillionaires created outstrips other [You must be registered and logged in to see this link.]. Yet bankers say margins are being squeezed as products and services are priced keenly to buy market share.

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