Executive SummaryPierre Masclet, Asia CEO and Singapore Branch Manager of Indosuez Wealth Management (Indosuez), is feeling positive. He reports that the firm has increased revenues by 80% since the start of 2017 and assets under management have risen to over USD14 billion in Asia, up more than 40% following the late 2017 acquisition of Crédit Industriel et Commercial’s private banking business in Singapore and Hong Kong. And staff numbers in Asia have grown to roughly 350 out of the 3150 strong Indosuez wealth management team worldwide. Masclet and his team believe that Indosuez offers clients in Asia a unique combination of global capability aligned with impartiality and a human-scale organisation that should encourage those clients to feel as if they belong to a ‘family’ and where the doors to the top management, to product experts, or to analysts and economists are always accessible. Like the Crédit Agricole group at large, Masclet extols the virtues of transparency and compliance, arguing that the client must have clarity and a feeling of comfort in all facets their interaction with the firm. He also emphasises the firm-wide focus on the vital issues of today for current and future generations of wealth market clients – from wealth preservation to planet earth preservation, from face-to-face banking to robo-advisory, from tailored private equity investments to mainstream financial market assets founded and managed on sound ESG principles. Asia is a key region for us, regional wealth is expected to grow over the next five years at roughly 10%, compared to an average of 3% in Europe, we expect to grow in line with the market. Asia is therefore a focal point for the expansion of the Indosuez operations through the hiring of high-quality talent, through investment in digitalisation, in further development of the broad, objectively-sourced universe of products the firm offers, and potentially through acquisitions, such as evidenced by the late 2017 purchase of the CIC n operations. Masclet and his colleagues are keeping their eyes firmly on what he calls the ‘client experience’ to ensure that every facet of the client’s interaction with the firm’s professionals, team-members, product suite and services are as excellent, personable and rewarding as possible.
Pierre Masclet has immersed himself in wealth management for more than 28 years, and unusually, in this day and age, only with one firm. He is justifiably proud of the achievements of Indosuez Wealth Management, which since 2016 is the re-launched global private banking brand of the Crédit Agricole Group. Masclet met with Hubbis to recount his evolution to his current role as Asia CEO and Singapore branch manager, and to explain why the group is so intently focused on growing the Asian operations, and how that can be achieved.
“We are really rather satisfied with the results in the recent past,” Masclet reports, “as the integration of CIC has been quite a success. We have even seen some net new inflows from the CIC clients.”.
Singapore is the regional centre for Indosuez, with Hong Kong as its second flagship centre, while both offices act as booking centres for Asia. Masclet presides over the entire Indosuez Asian operations from his base in Singapore, where he also acts as the Indosuez branch head for what is an active, diverse banking and credit operation.
He acknowledges how difficult 2018 was in the global financial markets, with 95% of all asset classes declining, but reports that despite this the current growth and targets are still to achieve about 8% to 10% annual growth in AUM in the region.
Masclet adds that Indosuez is proud of its interaction with the full array of Crédit Agricole’s banking, investment banking and asset management operations and skills in Asia, where the group employs some 5000 plus people.
“Yet we still maintain the human-scale for our clients, for them to retain access to the key stakeholders, whether that is the senior management, the risk department, compliance and, of course, the relationship managers and product specialists. Additionally, we want to offer our clients access to as many of our specialists as possible within the Asia region, whereas we find that many competitors centralise their expertise.”
Masclet believes Indosuez is ideally positioned to compete in the current and anticipated market environment. “As I said, we have the support of a major international group, yet we are a human-sized organisation that offers a wide array of products and services. This is really rather rare in our business.”
Masclet knows intuitively from his long experience that the key to Indosuez’s long-term success must always lie with the client. “Making sure clients are satisfied with our products, services, and performance is essential,” he comments. “We are therefore continuously fine-tuning the product platform, adding additional services, for example we added in 2018 real estate specialist in Singapore, or promoted some specific discretionary portfolio management mandates that are more fitting to client needs in Asia, as well as additional Singapore dollar DP mandates. In short, we keep investing in our product solutions and our services to make sure we deliver choice and quality for the client.”
He elaborates on the range of products and services by explaining that whereas many of the regional and local banks have a wide range to offer, those competitors often tend to be more focussed on specific types of products, whereas Indosuez, he states, offers “A service offering on a par with the major world players within a human-sized bank”. And total objectivity is essential in determining the choice of products, whereas too often competitors include many in-house products for their clients and are often overtly encouraged by their senior management to push those ideas.
Digitalisation is another area of progress for Indosuez. Masclet notes that parent company Indosuez Wealth Management Group has undertaken a worldwide digital upgrade programme dedicated to enhancing the client experience.
And another vital area of focus has been staffing, with the continuing quest to bring in new talent. “We believe we are now better positioned than ever before in this regard, but we must keep investing money and management time.”
Masclet explains that Indosuez remains an offshore operation, in Hong Kong and Singapore, and that the firm has no specific plan to open new branches or subsidiaries elsewhere in the region. “We have demonstrated that we can be successful as we are structured over the past two years and we believe we can continue on that path.”
Keeping things in the open
Masclet believes that as long as the firm can deliver on performance, the client will accept the fees, if reasonable and in line with the added value of the offering and the product. “Accordingly, we have no concerns on this,” he reports. “We offer such a wide array, from structured products, forex, DPM, advisory mandates, pure execution, private equity, funds so forth, and it is therefore the client who decides the type of relationship they want with us, and the type of products they prefer.”
Ahead of the game when it comes to regulatory change, reinforcing compliance and risk frameworks, the Bank decided in 2010 to withdraw its operations from tax havens and other non-cooperative territories in line with CA Group Strategy. Today, Indosuez only open accounts for clients who are resident in countries that participate in the Automatic Exchange of Information programme, which is committed to full reciprocity of information.
Looking to the future
To remain as relevant as possible, Masclet says the firm must address the real issues the next generations are facing. “We must focus on topics such as the environment, cyber-security, sustainability, education and so forth, not just on topics such as financial markets. We just had a summit that took place in Hong Kong in February 2019 that focused 90% of their attention on these issues for the future generations.”
Additionally, the distribution channels must be relevant, so, for example, Masclet observes that in the future the younger generations see digital banking, and other delivery protocols as the new normal. “Information is proliferating,” he adds, “so the experience of our bankers is vital to aid our clients in sifting through the often-overwhelming amount of information out there. Helping the clients understand the relationship between macroeconomics and the impact on the financial markets is also very important.”
“Unlike many other banks, we make a major effort to monitor the ESG performance of all our portfolios,” he adds, “as the next generation appreciate that we have a finite time horizon in which to cut excessive consumption and pollution on our planet.”
He notes that Indosuez is deeply committed to ESG principles and investing, “We rate all our clients’ portfolios according to ESG performance,” he reports. “We give them the ESG rating for each security, as well as their whole portfolio, then it is up to the clients to work with us to help improve these ratings. We see things changing quite positively and rapidly, in this regard.”
Masclet’s key priorities
Masclet has several important goals for the year or two ahead, including continuing growth in revenues, growth in AUM, recruitment of new talent and further enhancement of the platform in terms of both product and all types of services, as well as further digitalisation.
“A different way of expressing all this,” he says, “is further improvement of the client experience, from account opening to the way we interact with the bankers for different multichannel delivery, through all the product solutions and so forth. The client experience must be front and centre.”
Each touch point with the client, from front to back of the bank, must reinforce the quality and integrity of the offering. “Each client will have different ways to interact and the quality of interaction with all the stakeholders in the bank is vital, so the clients participate in the whole process, so that they enter into our family here, so to speak, meaning that the clients can see how closely we all work together and they can easily interact with absolutely everybody at the firm. It goes back to what I explained earlier about being a human-scale organisation.”