RCBC expects 15-20% AUM growth

ASSETS MANAGED by Rizal Commercial Banking Corp.’s (RCBC) wealth management group are seen expanding this year, with more product offerings in the pipeline and amid its increased clientele.

The bank unit is looking at a 15-20% increase in assets under its management (AUM) for 2016 after hitting its target in 2015, RCBC Wealth Management Group Head Jane N. Manago said in a recent interview.

The bank told the Philippine Stock Exchange earlier that its total assets under management grew by 13% to P84.3 billion last year.

Assets under management of RCBC was around P72 billion in 2014, officials of the bank unit earlier said.

“We’re targeting maybe 15% to 20% increase this year,” Ms. Manago said.

“Last year, we did [ hit our target] but midyear, we have to re-study if we have to adjust it up or down,” she added.

RCBC’s wealth management clients increased by 11% to 3,118 in 2015. For this year, the bank said in an earlier regulatory filing that is also looking to grow its clients by 16%.

For the last five years, AUMs of RCBC has been growing by a compounded growth rate of 20% and client base has grown by 16%, former RCBC Wealth Management Group Head Manuel G. Ahyong, Jr. said, adding that the bank unit has recently been focusing on diversifying its investments.

Ms. Manago said for this year, more clients and added investment options will drive the growth as it looks to expand its menu of offerings.

“We’re trying to expand our share of our existing customers’ wallet and at the same time, we’re on-boarding new clients because that’s where the growth will come from,” the official added.

At this point, the bank unit is “concentrating on Filipino and local Chinese markets,” “so we’d rather not at this stage go for the foreign markets.”

Last year, RCBC’s wealth management group said it has added the US and Japan equities market as another investment option for its clients.

The wealth management group of the Yuchengo-led bank has at least seven offices nationwide.

Meanwhile, Ms. Manago said clients of RCBC’s Wealth Man-

agement unit has “shifted to the younger generations.”

“When we started, we were serving clients who were in their late ’ 50s, ’ 60s and even ’70s, but we’ve noted in the past several years, they’ve passed on their businesses and even the management of their wealth to their children. Right now, we are dealing with this second generation and even the clients, that we are on-boarding right now, they are the younger ones, late ’40s, early ’50s and these people they are more knowledgeable.”

Overall, around 80% of its clients were already from the younger group, the official said, noting that previous clients have already passed it on to the next generation.

Average net worth was estimated to be at P5 million per wealth management client.

The bank’s wealth management unit is currently offering traditional products including fixed income, equities, securities, unit investment trust funds (UITF), mutual funds, and both local and dollar-denominated bonds to its clients.

Mr. Ahyong had said RCBC Wealth Management Group carries “over 50 mutual funds and UITFs” which basically make up about 90% of the mutual fund market in the Philippines. On its portfolio mix, the bank’s funds “are quite diversified.”

“We keep very little of cash — majority is in fixed income, mutual funds, UITFs and equities.”

RCBC shares closed at P31.70 each on Monday, down 30 centavos or 0.94% from Friday’s finish.