Rivals out in force to woo remisiers on news of DBS Vickers' revamp

Singapore

BARELY a day after The Business Times (BT) reported that DBS would transfer its retail equity trading under DBS Vickers to the bank by year-end, four leading brokerages in Singapore jumped into action and placed recruitment notices to woo these affected remisiers into joining their teams.

PhillipCapital put out a print advertisement on Friday, two days after the news broke. In it, it called all remisiers and dealers to partner its brokerage house, which is "still growing its sales force".

Its spokesman told BT: "We are actively looking to partner these people and build up our sales force. Those who choose to partner with us can elect to focus on securities, or offer a wider range of services and products. They can be remisiers, financial advisors, portfolio managers or even own a franchise model."

The spokesman added that as remisiers are self-employed, there is no limit to the number Phillip is looking to take in, since the brokerage is looking to partner them to build up the business.

A dealer is a full-time employee of the company who is paid a basic salary and a smaller cut of the commissions earned; remisiers, on the other hand, are not full-time staff. They are not paid a basic salary, but take a larger share of the commissions split.

Phillip has more than 1,000 remisiers, financial advisors, portfolio managers and dealers on its team.

OCBC Securities Pte Ltd (OSPL) homed in on its remisier referral scheme in its regular e-mail notice.

"Do you know that we have a referral scheme for remisiers whereby if you successfully refer a friend to join OSPL as a remisier, we will pay you a referral fee of S$1,000 for each successful referral (subject to terms and conditions)!

"So, do spread the news out to your friends that OSPL is still hiring and growing our business," the e-mail said.

CGS CIMB Securities Singapore also took the opportunity to beef up its sales force. In an apparent reference to rival DBS Vickers, its recruitment notice read: "You are valued more than you think. Continue doing what you love. Join a sales force which cares!"

UOB Kay Hian, the largest securities brokerage in Singapore, also jumped on the bandwagon, inviting those with "a passion in trading to join our dynamic team as dealers or remisiers now".

"UOB Kay Hian is strategically positioned to tap the growth opportunities that this fast-developing region offers, and we are constantly on the lookout for bright and dedicated individuals to help us reach new heights."

The brokerage said it expects its professional equity sales dealers to manage their own portfolios of clients and assist them in equities dealings and investments in other financial products, as well as to build relationships, among other things.

Brokerages said DBS' move to merge retail equity trading into the bank was specific to the bank, which has chosen a different direction and model. DBS has said that the equities trading business remains critical to the bank. Over the years, it has noticed a growing demand among customers for a one-stop platform which gives access to an array of banking, brokerage and wealth-management solutions.

A town hall meeting between DBS Vickers remisiers and management had left the remisiers - some of whom had clocked 20 years or more with DBS Vickers - "angry and betrayed", although the bank has promised to do its best to offer them jobs.

One remisier said: "Questions about attempts by the bank to undermine remisiers' businesses were not addressed. For example, remisiers cannot do bonds and placements as they are under the purview of accredited investors, who do not come under the bank."

Another said: "There were no answers as to what would happen to the trading accounts that do not fall under the wealth platform."

Public support for affected remisiers at DBS Vickers has been palpable, notably from fellow remisiers from rival brokerages. Many argued that remisiers still have an important role to play in the securities market.

In a letter to BT, Albert Fong, former president of The Society of Remisiers Singapore (2004 -2013), rallied behind remisiers who, he said, are not merely order-takers. Many have moved beyond traditional stockbroking to selling financial products such as equity-linked notes, yield-enhanced certificates, corporate bonds and other innovative derivative products to boost their incomes, he noted.

"They act as private bankers like those in the wealth-management space and help clients make sound investment decisions, while being mindful of their investment objectives and risk profiles in an increasing volatile market. Through dedication, knowledge and professionalism, they have forged trusted relationships with their clients over the years."

Mr Fong added: "Stockbroking companies are fully appreciative of the vital role of the remisier and value their partnership. To the brokerages, remisiers act as credit controllers who are entrusted with setting clients' trading limits, recommending credit lines and monitoring margin ratio for margin accounts.

"In debt recovery, they assume the underwriting role. As risk managers, they must not only limit risks to themselves, but also those of their companies and clients from over-trading."

Leong Mun Wai, chief executive officer of Wintop Capital and former managing director at two local brokerages, lamented that little has been done to strengthen the securities industry. He argued that a healthy securities market helps to allocate risk capital to deserving companies, a function which the banks cannot perform.

"The actual experience in all developed financial markets however, is that by contributing their risk-taking culture and skills, stockbrokers and securities houses are an indispensable part of these markets. Furthermore, diversity - rather than concentration - is the preferred structure in the capital markets.

"So the disappearing stockbroking and securities industry (and the remisiers) is a worrying trend and probably the single most important factor behind the shrinking stock market."

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