Bank of East Asia: expanding its wealth management offerings at home and in China

Bank of East Asia’s private banking arm, BEA Private Banking, is making further inroads into the competitive Hong Kong market and further afield to Mainland China and elsewhere in the region. Hubbis recently met with two of the bank’s leading bankers, Grace Chow and Jessica Ng who are building the bank’s private banking and wealth management presence and competitive edge.

Grace Chow is general manager and head of the BEA’s wealth management division, while Jessica Ng is a long-serving BEA banker who heads up BEA Private Banking (BEAPB).

Both have a deep corporate and personal perspective on the growth of wealth in Asia and the expansion of BEA’s range of skills and services to cater for this growth, especially in the massive mainland Chinese market on Hong Kong’s doorstep.

BEA’s long history in Hong Kong and China

They believe BEA has the history, the brand, the management drive and the skills to compete with some of the bigger global and regional players for the growing numbers of high-net-worth (HNW) clients in Hong Kong, China and further afield, for example, Taiwan and other countries in the region.

“Drawing on our complete range of financial and banking services,” says Chow, “we can provide HNW clients with highly customised solutions, including specific structured products, investment funds, or insurance. Our clients know that we have been here working with businesses and families for generations and that longevity is certainly a key added-value we offer.”

BEA’s suite of banking and wealth management services includes corporate and commercial lending, trust and other wealth management services. This comprehensive suite of solutions allows the bank to cater to its clients’ personal and business needs. In mainland China, BEA operates one of the most extensive networks of any foreign bank. “Our strong presence in mainland China enables us to establish relationships with the fast-growing number of wealthy and super-wealthy clients there, many of whom are entrepreneurs,” says Ng.

A broad range of services and solutions

“We offer both managed solutions and financial planning, or we support clients who prefer to handle their investments themselves,” Chow explains. “We also provide a wide array of corporate finance and integrated business, corporate, and investor services to support just about every business need imaginable. And for HNWIs we provide estate planning as well as trust and fiduciary services to help clients structure and manage their estate based on your particular requirements and changing personal circumstances.”

BEA is adapting its range of services to match the demand, especially for outward investments and offshore asset allocation by mainland Chinese clients. The bank has been building out its numbers of relationship managers and what it calls service ambassadors to cater for this growth, especially in the Greater Bay Area comprising Guangdong, Hong Kong and Macau.

Ng explains that the China card is a considerable advantage for the bank, as BEA has 100 outlets in 44 cities throughout the mainland and a concentration of about 30 outlets in the key mainland cities in the wealthy Greater Bay Area.

Expansion in China

“For our mainland China clients,” she notes, “we offer a broad range of banking options locally as well as wealth management from Hong Kong, so we can today offer a total range of banking and advisory services. We have a long history in China, almost 100 years, and we have a deep understanding of the regulations on cross-border flows. Additionally, we have strategic overseas locations, such as London, where many Chinese tycoons like to buy properties. Singapore as well, of course.”

Chow adds that BEA is committed to wealth management as the fee income from wealth management services naturally balances off the interest-generating income of the bank. "And for the clients,” she says, “if we can help them achieve a better return than the plain vanilla interest income and advise them on opportunities, structures and so forth, then we have clients we can build with for the future.”

While there are naysayers who argue that Hong Kong’s star is waning as a centre for China – due to competition onshore and offshore from Singapore - Chow and Ng both remain confident about BEA’s role in the development of wealth management in Hong Kong.

Hong Kong as a conduit

“The mainland Chinese clients will continue to come through Hong Kong as they accumulate wealth at home and then invest their surplus assets globally, first coming through Hong Kong, which offers a portal to the world of mainstream and alternative investments,” says Ng. “Hong Kong is familiar to them and safe.”

Nevertheless, both bankers voice concerns that regulators might be playing too strong a hand. “We want the regulators to recognise that while safety is very important, so too is Hong Kong’s competitive position in the region and globally,” says Chow.

Ng also expresses concern that Hong Kong’s competitive position as an offshore centre is being weakened in comparison with Singapore. “Clients have choices, and money can move in accordance,” she says. “If a market becomes over-regulated, the clients can move jurisdiction to a more balanced environment, or they might put money into less-regulated areas, such as property, alternative investments such as hedge fund, private equity, precious metals and so forth, all of which have very few regulatory restrictions. Neither are positive for a market such as Hong Kong for the longer-term.”

Digital to enhance relationships, not impede them

Moreover, Chow has concerns that digitally-enabled, low-cost competitors can enter the market with far fewer regulatory or cost impediments. “While it becomes ever more difficult for clients to do things through the banks,” she says, “digitally there are so many opportunities arising for speedy, efficient, low-cost transactions. Of course, the banks are becoming ever more digital, but in the world of private banking we need to be cautious on the regulatory and compliance side so it all takes longer.”

Chow also recognises that the newer generations of clients, especially those from China, want to do more and more digitally.

“There is far greater demand for digital advisory and execution,” she notes, “but we must be careful not to rely on digital entirely, as it becomes more difficult to build a relationship with the clients. We must balance these two needs, so we are building our digital capabilities for clients, for example offering clients the opportunity by later this year to fully review their portfolios on mobile applications but making sure that we keep the relationship managers as close as possible to the clients. We have to make the client experience more enjoyable and more fruitful on both the digital and personal levels.”

The digitisation Chow refers to is an extension of the iPortfolio Analyzer launched by BEAPB in 2017. The iPortfolio Analyzer was co-developed with IBM and is a secure mobile solution that enables BEA’s relationship managers to access and display portfolio information for clients at any location from their iPad. The next step, as Chow explained, is to offer this facility directly to end-clients.

"We are in the business to serve our clients for the long-term," Ng concludes.