HSBC Plans Big Asia-Pacific Wealth Build-Out

Tom Burroughes

26 February 2021

, which a year ago folded business units together to build its wealth and personal banking business, yesterday said that it intends to invest more than $3.5 billion over the next five years in Asia.

The spending will be used to expand distribution capacity in Hong Kong, mainland China, and Singapore; enhance digital wealth capabilities and platforms across Asia and develop new products, particularly for high net worth and ultra-HNW clients, HSBC said in a statement.

Like some of its peers, HSBC is pushing hard in Asia, a region with which the bank has long historical associations. Asia generates nearly half of its $1.6 trillion wealth balances and 65 per cent of its wealth revenues.

“We have a bold but achievable ambition, to be Asia’s leading wealth management provider by 2025, supporting Asian, international and HSBC-connected clients, wherever their wealth is created, invested and managed. Our wealth expansion is already underway,” Nuno Matos, chief executive, wealth and personal banking, said. (Pictured.)

The UK/Hong Kong-listed bank, which unveiled its 2020 financial results earlier this week, plans to hire more than 5,000 customer-facing personnel in the next five years, including relationship managers, investment counsellors and specialists to provide better support for affluent, high net worth and ultra-high net worth clients in Hong Kong, Singapore, and mainland China.

The bank said it will continue to “invest at scale” in Hong Kong.

Greg Hingston, regional head of wealth and personal banking, said: “Asian wealth onshore and overseas, offers one of the most compelling growth opportunities today. HSBC is forging ahead from a position of strength and with momentum as the second largest international wealth manager in Asia. In the next five years, we plan to extend private banking in mainland China to 10 cities and more than double our Jade client base in mainland China and Singapore, where we will bolster our international wealth credentials. In India, we target to be the top foreign bank for non-resident Indians.”

Details
The bank aims to hire as many as 3,000 wealth planners to boost the group’s new mobile wealth planning service in mainland China, which was launched in mid-2020 to reach new clients outside of the branch network. To date, there are more than 200 new wealth planners in Shanghai, Hangzhou, Guangzhou and Shenzhen.

HSBC said it will also “step up” investments in technology to build digitally-enabled financial planning platforms across its full spectrum of customers, integrate wealth management solutions and wealth insights on mobile banking, optimise its insurance ‘health and wellness’ platforms in Greater China and create a single core banking platform for private banking.

The bank said it will also deliver “bespoke wealth products” for its Jade and private banking channels, taking advantage of its global markets’ expertise, and build asset management capabilities in areas such as alternatives and ESG investing.

Within the mass-affluent area, HSBC said it has a “solid and well-entrenched mass affluent customer base through Premier ($500k+ of investable assets). “We’re making strong inroads in the emerging HNW and HNWs with Jade ($1-5 million of investable assets), after we formally launched this proposition in Hong Kong, Singapore and mainland China in 2019,” the bank said, adding that its Jade business is the “new sweet spot of wealth.”

Globally, private banking client assets grew to $394 billion in 2020, rising by 9 per cent year-on-year. Private bank client assets now account for a quarter of the $1.6 trillion wealth balances in the wealth and personal banking group, rising by 12 per cent year-on-year. Asia-related assets rose by 176 billion, or a rise of 16 per cent on a year ago.