Independent Wealth

Bespoke asset management services offer a tailored approach for ultra-high-net-worth clients

The rise of bespoke asset manager services and their tailored approach

Asia’s ultra-high-net-worth clients are increasingly turning to a new generation of independent asset managers who operate alongside the traditional private banking space. Across Hong Kong and Singapore, these boutique advisers manage more than US$90 billion of client money and are gaining in popularity.

External managers have been common in Europe and the US for several decades, but it is only really in the past decade or so that they have become active in Asia— largely as a result of the global financial crisis, when numerous private banking operations pulled out of the region or were subsumed into other banks.

Before the turmoil of that period, private banking clients in Asia tended to stay loyal to brands. If their relationship banker left to join another bank, they would stay with the bank and start afresh with a new banker. But that changed after 2008, when the crisis eroded the perception of banks as rock solid institutions that would always be around. The Asian private banking unit of Société Générale became DBS and Barclays became Standard Chartered.

Through the turmoil, clients learned to follow their trusted bankers even as their business cards changed. After all, the point of a private bank is that it’s private: very few clients want to share sensitive information about their lives and finances any more than necessary.

This change of mindset allowed some experienced private bankers to set up on their own and take their clients with them, which was rare before the crisis, though not unheard of. One of the first was Olivier Mivelaz, a banker from Geneva who established his own firm in 2004 after working in private banks in Asia since 1987. Today, Swiss-asia is one of the biggest external asset managers in the region, employing 80 people in Hong Kong and Singapore.

“Typically, the clients who are interested in working with us are the ones who want an exchange of ideas,” he says. “They want to talk to somebody, they want to debate. For us, the key is to keep the channel and the conversation open.”

And the relationship between independent asset managers and private banks is not necessarily competitive; firms such as Swissasia still direct their clients to private banks to provide custody, trading and solutions.

“Some banks love what we do because we bring clients to them and they don’t need to pay anybody to take care of the client,” says Mivelaz. “We share the revenue with them and in many cases these are clients they would never get otherwise.”

Indeed, many banks provide dedicated services for external asset managers. In June, Credit Suisse teamed up with Prive Technologies, a Hong Kongbased digital wealth management solutions platform provider, to give external asset managers (EAMS) access to technology solutions.

“In this evolving business environment, process automation and technology solutions will become increasingly important for EAMS to better serve their clients, increase operational efficiency and improve risk management controls,” said Sascha Zehnter, the bank’s head of EAMS in Asia Pacific.

These types of operational tools allow external managers to dedicate more of their resources to the kind of personal service that their clients value, especially small firms that find it difficult to invest in technology.

And when it comes to products, one of the key advantages for managers such as Mivelaz is the ability to work with whichever private bank he judges is best for his client’s particular needs, providing a high level of customisation.