The chief executive of LGT Group, the Liechtensten-headquartered bank that bought ABN AMRO’s Asian private bank just over a year ago, says the number of “sizeable” private banks in the region will fall.
Prince Max von und zu Liechtenstein, CEO of LGT Group, told the South China Morning Post that consolidation will continue to be a feature of Asia’s private banking field. Already, a number of firms have spun off Asian private banking units.
“The number of sizeable private banks, say, large enough for a newspaper to cover them, will come down,” Prince Max von und zu Liechtenstein, was quoted as saying.
In December 2016, LGT bought the Asian private banking arm of ABN AMRO; Singapore-headquartered DBS has bought Australia and New Zealand Banking Group’s Asian private banking and retail arms; Societe Generale has sold its Asian private banking business to DBS, while Barclays has sold its Singapore and Hong Kong private banks to OCBC. On the flipside, firms such as UBS, Credit Suisse, Citi, JP Morgan and HSBC, among others, have pushed harder at wealth management in Asia. In some cases, the divergent strategy comes down to whether firms were able to reach critical mass in terms of scale to make sufficient profits, and compete against domestic firms with an existing strong brand and network. Last week, J Safra Sarasin Group, the Switzerland-headquartered private bank, said it continued to seek acquisitions as part of its growth strategy.
LGT started its private banking business in Asia in 1999, and the acquisition in 2009 of Dresdner Bank (Switzerland) was followed by a selective private banking portfolio from HSBC Private Bank Suisse and a majority stake in London-based wealth management company Vestra Wealth.
Prince Max also suggested the bank is positioning to win business from the younger cohort of HNW individuals in Asia.
“The share of young wealthy clients in Asia is higher than in Europe. Some of the big fortunes now are being created by entrepreneurs who are still relatively young,” he was quoted as saying. “You need to speak their language,” he added.
LGT is due to release results for 2017 on 12 March.