Oversea-Chinese Banking Corp.’s private bank plans to add headcount to its China business, joining HSBC Holdings Plc and DBS Group Holdings Ltd. in staying bullish on the world’s second-largest economy despite a marked slowdown.
“With the Chinese economy being slower than anticipated, some clients or prospects have decided to leave some liquidity to shore up their operations in China,” Bank of Singapore’s Chief Executive Officer Jason Moo said in an interview this week.
That has contributed to slower wealth flows from the mainland, according to the banker who joined the firm in March. He has previously worked with Julius Baer Group Ltd. and also spent two decades at Goldman Sachs Group Inc.
Given the amount of China “wealth is so vast, we can still hire people” who can bring more assets to the bank from rivals, said Moo. He recently unveiled a plan to grow the bank’s relationship-manager headcount to 500 by the end of 2025 in its three core hubs in Singapore, Hong Kong and Dubai, from about 400.
The firm is also targeting growing assets under management by 20% to about US$145 billion ($197.6 billion). The bank’s assets under management rose 6% to US$121 billion as of June from a year ago, partly because of new inflows.
“I want to be nimble,” and hire when good bankers are available, he said, when asked how many new positions he would allocate to the Greater China teams.
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China, which has seen one of the world’s biggest wealth booms in the past decade, is going through a rough patch after a property crisis and rising unemployment.
However, mega-cities Beijing and Shanghai are forecast to see 60% growth in terms of the number of millionaires worth more than US$100 million within a 10-year time frame, according to a Henley & Partners report. That’s faster than all major US cities and London.
The slowdown in China is more cyclical, rather than structural, according to Moo.
China will continue to be significant for DBS’s strategy, CEO Piyush Gupta said in September. Meanwhile, HSBC agreed to buy Citigroup Inc.’ retail wealth management portfolio in mainland China this month.
Singapore is one of the popular places for the rich Chinese population to park their assets and set up businesses. Mandarin is commonly spoken in the country and the city-state is known for its low tax regime.
However, the island state’s reputation has taken somewhat of a hit from a recent multi-billion dollar money laundering case. Bank of Singapore is among more than 10 lenders that are embroiled in the scandal because of banking relationships with some of the suspects or their companies.
Moo added the private bank has maintained “extra vigilance” and tough standards when it comes to account opening for clients and prospects from all regions. The bank has imposed no new measures and continues to allow bankers to travel overseas to destinations including China, he said.
