Big Pay Hikes: The Battle for Wealth Managers Heats Up

Big Pay Hikes: The Battle for Wealth Managers Heats Up

It's the employee's market for Asia's wealth managers, as banks go all out to woo bankers with the assets they target. finews.asia finds out how much wealth managers stand to gain when moving to rivals.

Recruiters and private banks say that competition to manage Asia's growing millionaires' wealth has led to pay hikes to the highest levels in a decade. Talented wealth managers in Asia can expect at least a 30 percent increase in pay in order to switch employees, according to a report in the «Bloomberg».

However, some private bankers tell finews.asia that the 30 percent increment is rather «exaggerated» and does not apply across the board. «It applies only to top bankers with between US$300m to US$500m in assets under management», said one private banker who declined to be named. This premium tends to be reserved for fluent Mandarin speakers, she added.

Hiring Aggressively

On average a wealth manager at a major bank handled $341 million in assets under management, or AUM, last year, according to «Asian Private Banker».

Certain private banks are hiring aggressively to get a slice of the growing market serving high net worth individuals (HNWIs). DBS Private Bank plans to tap into Asia's burgeoning wealth by increasing the number of client-facing bankers by as much as 20 percent, while Bank of Singapore aims to double the number of relationship managers (for Hong Kong and Singapore) within two years. 

Other private banks, however, prefer to groom internal talents and hires selectively at senior levels. «At Citi, our employees are our greatest asset. This is why when we source for talent, looking for and grooming people internally from within the bank is where we always begin first,» Jyrki Rauhio,   South Asia head at Citi private bank told finews.asia.

Hot Market

HNWIs are usually defined as individuals with investable assets of $1 million or more (excluding primary residence, collectibles, consumables and consumer durables).

The Bank of Singapore, the private bank of OCBC Bank, say they are discovering new high net worth clients every day. «It's a crazy market,» said Derrick Tan, head of Greater China and North Asia at Bank of Singapore, who was quoted in the Bloomberg article.  

Globally, the number of HNWIs grew almost 10 percent, or 1.6 million, to 18.1 million in 2017, according to data from «Capgemini». 

Millionaire Factory

For Zurich-based private bank Julius Baer, momentum for net new money growth was particularly strong in emerging markets and the Asia Pacific region, as reported by finews.asia. This was due to significant contribution from relationship managers who joined in the last two years.

Asia is a millionaire factory, according to Capgemini's World Wealth report 2017. Although the U.S. leads with 5.3 million HNWIs in 2017, the Asia-Pacific region has the most HNWI millionaires overall - Japan, China and India had HNWIs of 3.2 million, 1.3 million and 0.3 million respectively.

Capgemini's 2017 report found that the average HNWI investments overseen by wealth managers increased in value by 24.3 percent.