China city commercial banks seek share of private banking business
Need for caution on potentially unbalanced cost-income ratios and other obstacles may hamper city commercial banks’ private banking efforts. November 28, 2012 | Alice YangWith the predicted number of HNWIs with investable assets over $1 million in China reaching 2 million by 2015, and in light of the private banking business set to become the next profit growth point in the country, it’s not hard to understand that city commercial banks in China are proactively joining the fight for a share of the business now. To date, four city commercial banks that have established private banking centers in China comprise Bank of Beijing, Chengdu Rural Commercial Bank, Bank of Shanghai and Hangzhou Bank, with Bank of Beijing’s March opening of its private banking center being the first. All established their branches in the affluent cities of Beijing, Chengdu, Shanghai, and Hangzhou. Without the advantage of nationwide branches and brand influence, these relatively small regional banks are hoping to use their relationships with local governments and entrepreneurs to expand their private banking business. Bank of Beijing attracted their first private banking customers from the entrepreneur friends they made in days of old. Its service model is “1+1+N”, which means the support team comprises one private banking relationship manager, one corporate business relationship manager and many other investment managers to serve one private banking client. With the combination of corporate business and individual wealth management business, Bank of Beijing hopes to build a differentiation strategy. China first started private banking five years ago in 2007. A lack of experience, strict regulation and the lag of legislation have put the private banking business in an awkward spot. Common problems that the Chinese private banking business is facing are products that are seriously homogeneous and a lack of professional talents. Under the segregation of financial businesses, the innovation of products is immensely limited so that it’s difficult to satisfy HNWIs’ advanced needs for investment portfolios. Looking d... Please login to read the complete article. If you already have an account, you can login now or subscribe/register.
Categories: China, Retail Banking, Wealth ManagementChina,retail,Wealth Management, China,Retail Banking,Wealth Management, Keywords:Private Banking, HNWI, Bank Of Beijing, Chengdu Rural Commercial Bank, Bank Of Shanghai, Hangzhou Bank Private Banking, HNWI, Bank of Beijing, Chengdu Rural Commercial Bank, Bank of Shanghai, Hangzhou Bank
|