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UOB transforming its private banking with hires and ambitious agenda
QUIET and unassuming. That sums up the state of UOB Private Bank before its new head took charge a year ago. But things have started to change since she came on board.
Under its new boss, Ong Yeng Fang, who left Bank Julius Baer to join the bank in June 2014, UOB's private-banking arm aims to triple the number of its Chinese clients in three years.
UOB doesn't break down its client base but Ms Ong, who was personally invited by UOB's CEO, Wee Ee Cheong, to head the private banking unit, indicated that the business from each Chinese client is sizeable.
Overall, Asean clients still account for the bulk of the base, which is dominated by Singaporean and Malaysian clients. This may be only for now.
Clients in the wider Asian region are consolidating their assets and trimming their private-banking relationships, which spells good news for UOB in drawing them completely into its fold.
"UOB is at a very advantageous position," Ms Ong told The Business Times in an interview this week. "They've banked with us for a long time, either at the retail side or the commercial side, and they feel very comfortable. Obviously, if other banks are not giving them the best service, they will think, 'this is a good time for me to consolidate everything at UOB.'"
In just over a year, UOB's private banking business has grown over 30 per cent in income. That's faster than its two domestic rivals, though it has a smaller asset base.
The bank's total assets under management in its wealth management space - which includes the private bank business - stood at S$83 billion in June 2015, up from S$48 billion in 2010.
UOB's private-banking unit has beefed up its expertise. It will nearly double its number of relationship managers to about 100 by end-2015, up from 50 to 60 in June 2014. It has also bumped up the number of specialists in various asset classes, in markets and in risk management.
Ms Ong said the recent market volatility make it tougher for the bank to maintain a 30 per cent growth in income this year. But she indicated that most of its clients have not lost their footing amid the market swings - and the private bank has been nimble with market positions.
"A year ago, I probably have to admit to you, we didn't have that kind of (product) suite that a Swiss bank has. But come end of this year, I'm very confident that whatever a Swiss bank has, I can do," said Ms Ong. "And clients also know."
Despite the tight market for experienced bankers, UOB has managed to secure new Singaporean hires who have spent at least a decade in the industry. Ms Ong herself is a 25-year veteran in the banking world, including 17 years in DBS' corporate and investment banking unit.
Ms Ong said local private banks are going through a growth phase and, like their other Asian counterparts, are attracting clients looking for safety in the post-crisis period.
She has also aligned her unit's practices with that of established banks. The private bank now gets the best pricing for products from the market, rather than accepting all prices from the bank's treasury team. She also replaced a commission-based structure to one based on bonuses.
"In a way, they also want to contribute back to Singapore. There's some patriotism here," she observed of the new hires. "I started with a local bank. Now that I've turned one full circle, I think it's good to put all the best practices back to a local bank to raise the local banks' standards."
In the days ahead, UOB's private bank can also scale up its business with higher regulatory standards as its immediate reference, as opposed to spending time and resources to remodel existing systems to fit the more stringent environment, Ms Ong said. "Everything is afresh, and we start on the right footing."