Credit Suisse Sees Onshore Wealth Shift In Asia - Report

Tom Burroughes

21 August 2018

Wealth managers increasingly need to focus on building scale in specific regions and countries rather than just pile up assets in Asia’s principal hubs of Singapore and Hong Kong, a senior private banking figure says.

Private banks that aim to exploit Asia’s surging onshore wealth must be less focused on regional asset totals and more on accumulating a critical mass of wealth in the individual Asian countries, Francesco de Ferrari, head of Asia-Pacific private banking at , told Bloomberg.

For Credit Suisse, the target is at least $10 billion in each of its 11 key markets across Asia, de Ferrari was quoted by the news service as saying.

“What is the minimum critical size for a bank in Asia? What is the size of assets you need to become viable? Most people would have said 10 years ago it was $10 billion-$20 billion, now it’s $30 billion-$40 billion,” de Ferrari said. “But the market size for Asia is completely the wrong question. For me, we need to have a minimum size by market if you want to operate there.”

“Over the last six, seven years, as our assets doubled overall in Asia, our onshore tripled,” he said, referring to a structural move in the region.

Recent years have seen shifts such as movements of money back to Indonesia from some offshore hubs – Indonesia held a tax amnesty programme a year ago (debate remains on exactly how effective such programmes are).

Credit Suisse set up an onshore wealth team in Manila earlier this year, after creating a similar operation in Thailand two years ago. The bank is also seeking to raise its stake in its China securities venture with Founder Securities Co. to 51 per cent from 33.3 per cent, the report noted.

The Zurich-listed lender also has an onshore presence in Japan, the Philippines, Australia and India, in addition to Hong Kong and Singapore, which also act as the bank’s offshore booking hubs for the region. Credit Suisse covers its other key Asian markets of Malaysia, Indonesia and Taiwan from Singapore and Hong Kong.