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Cross-border bounty for managers

Published on Friday, 15 Oct 2010
Kornerstone Institute’s Catherine Chan and IAFM’s Vincent Lee offer tips to tap mainland wealth.
Photo: Edmond So

The mainland is expected to become one of the world's largest markets for financial services. Nevertheless, many top wealth managers in Hong Kong have found it difficult to crack the sector.

One of the challenges is establishing long-term relationships with high-net-worth individuals (HNWIs) from the mainland, especially those looking to diversify their investment portfolios in Hong Kong.

Participants at an upcoming seminar will receive practical tips on how to provide custom financial services to meet the needs of these HNWIs.

The seminar will provide an in-depth analysis of the investment tools sought by affluent mainlanders, why they prefer these products, and what Hong Kong wealth managers can do to tap into the mainland's financial services market.

Armed with this knowledge, local wealth managers should be able to come up with winning strategies to corner this fast-growing market.

The seminar - "Winning Strategies for Hong Kong Wealth Managers in China" - is organised jointly by Classified Post, Kornerstone and the International Academy of Financial Management (IAFM), and will be conducted in Cantonese at the Hong Kong Club Building in Central on October 28.

"The seminar was designed for private bankers, wealth managers at local retail banks, professionals at insurance and securities firms, and the others for whom the mainland HNWIs are potential customers," says Vincent Lee, the seminar's main speaker.

He is a governor and marketing director for Asia at IAFM, a professional association with more than 200,000 members, associates and affiliates in 145 countries.

The academy offers specialised finance-related training programmes through a host of local professional education institutions around the world.

Lee, who has more than 12 years of experience in wealth management on the mainland, is also the vice-dean of the Foreign Investor Management Centre in Shenzhen and vice-director of the Wealth Management Association of Shanxi Province.

He has helped train more than 5,000 wealth managers from four mainland banks, and says he will help seminar participants gain a better understanding of the mentality and needs of wealthy mainlanders.

Leading international private banks, including UBS and Credit Suisse, define HNWIs as those who have at least US$1 million in investable assets, and the same definition applies on the mainland, Lee says.

According to the 2009 China Private Wealth Study jointly released by China Merchants Bank and Bain & Co, the largest shares of investable assets by mainland HNWIs were in cash, deposits, stocks and equities.

A Merrill Lynch study released in the second quarter of this year estimates there were 477,000 HNWIs on the mainland last year, a 30 per cent jump from the year before.

"In addition, the research shows that 69 per cent of these HNWIs have expressed interest in emigration because they aim to seek tools and products to spread investment risk," Lee says.

Although the domestic investment market on the mainland has been developing rapidly, various regulations limit the offshore investment products and tools that private bankers can offer there.

There are also many restrictions on cash remittances out of the country.

Lee says mainland HNWIs are no longer limited to major cities, such as Beijing, Shanghai and Guangzhou, and more affluent residents are coming from more remote and less developed areas, particularly Sichuan, Yunnan and Shanxi provinces.

"When they look for offshore investment opportunities, around 80 per cent of them look no further than Asia-Pacific - and Hong Kong is their favourite investment market.

"This represents a good opportunity for wealth managers in Hong Kong."

He says wealth managers here should learn what investment tools mainland HNWIs have purchased so they can recommend alternative tools to help them diversify their portfolios.

According to Lee, affluent mainlanders have become more open-minded about overseas banks when selecting investment products.

"The seminar aims to provide some guidance to wealth managers in Hong Kong on ways to get the attention of these HNWIs and tailor services to meet their needs," he says. "I will also discuss ways of providing services to HNWIs from China which are in compliance with the laws."

He says mainland HNWIs, seeking investment opportunities in Hong Kong, are on the hunt for trustworthy wealth managers who can serve them for the long-term.

"They examine the quality of service provided, the professionalism and expertise very carefully. For them, a sound relationship with their wealth managers is of paramount importance," Lee says.

Hong Kong wealth managers have the competitive edge over their counterparts across the border because they are highly regarded by mainland HNWIs. For these investors, a wealth manager's professionalism, quality of service and expertise are more important than the number of branches operated by a particular company, Lee says.

Event details  

Date October 28

Time 2pm - 5.30pm

Venue 15/F Hong Kong Club Building, 3A Chater Road, Central

Fee HK$750


Inquiries 2565 2426 (Classified Post), or 2116 3328 (Kornerstone)

Tips for wealth experts

The seminar "Winning Strategies for Hong Kong Wealth Managers in China" was designed to provide tips to banking and finance frontline staff who want to tap into the bulging millionaires' row on the mainland.

Catherine Chan, managing director of Kornerstone - which organises specialised professional training programmes for individuals and corporations in Hong Kong - says the seminar also aims to help insurance professionals who want to switch to wealth management, and those who are already serving the mainland market, but want to gain more knowledge about the mainland's high-net-worth investors (HNWIs).

"Many of our customers in the banking and financial sectors are attracted to the mainland market. They realise they need to adopt a different approach to the market than the one used for local HNWIs. One of the challenges is how Hong Kong wealth managers can compete with their mainland counterparts," Chan says. The seminar's market oriented content was developed to meet the needs of experienced wealth managers, with an emphasis on the sharing of practical skills and strategies.

"Kornerstone has provided training to over 6,000 wealth managers in the Greater China region. Our research data will complement those from the International Academy of Financial Management and present some fresh ideas to the participants."

Some materials from the academy's Chartered Wealth Manager Programme will also be used, says seminar speaker Vincent Lee, a member of the academy's board of governors and its marketing director for Asia. "I will discuss the psychology of HNWIs to help participants gain an understanding of what the HNWIs take into account when they make investment decisions," Lee says.

"The best practices of wealth managers will also be covered."

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