Wealth Management Leader Jon Wongswan on Future-Proofing the Wealth Management Model in Thailand
Kiatnakin Phatra Financial Group is originally the result of a merger of a commercial bank operated by listed Thai bank Kiatnakin Bank, with extensive experience of over 40 years, and a capital market business operated by Phatra Securities, a leading company in securities brokerage business in Thailand. Kiatnakin Phatra Financial Group is listed in the Stock Exchange of Thailand (SET) as KKP and operates businesses in financial and capital markets, focusing its expertise on a wide range of services covering all needs of customers, including individuals, businesses, and domestic and international institutions. Wealth management is a core activity within the group and we had the opportunity to recently ‘meet’ again with Jon Wongswan, who is Managing Director and Head of the Investment Solutions Department at Kiatnakin Phatra Securities, where he oversees investments and product selection for the Wealth Management Group. Hubbis has enjoyed Jon’s insights in the past – we last met well before the pandemic hit – and for this latest interview he offered his views of the evolution of wealth management in Thailand since early 2020, set against the backdrop of his more than 20 years of experience in the financial industry both domestically and internationally. As he is one of the tried and trusted experts on the Thai wealth management market and also has nearly some eight years of experience working with the US Federal Reserve and then Barclays Global Investors, his latest insights should certainly help readers understand more of the key emerging trends.
Jon opens the discussion by reminding us that Kiatnakin Phatra Securities, or KKPS for short, is still perhaps better known in Thailand as Phatra, even if it is no longer that entity alone. But he reports that while the institution remains much the same, he is now also responsible for rather more areas and teams than when we last met up before the pandemic. The reasons are simple – the market had moved on, clients need and expect more products and better advice, and the competition has meant leaders such as Phatra have had to play smart to stay ahead of the game.
Expanding the offering
He explains that as well as his small teams for equities, for fixed income, and for structured products, under his stewardship he now also has a small but fast-growing team for private markets, launched in 2019, and that he reports has become a significant portion of the business. “We curate ideas for our clients to invest abroad with top private market managers, a move that has proven very popular with clients,” he says.
Jon also oversees the newish KKPS team for investment consulting and another team for discretionary mandates that was launched in September 2020, managing global investment portfolios for clients. “Finally, we have another team for the platform and execution, as well as our data analytics team,” he reports. “All these services and products fall within my remit as MD of the investment solutions department.”
Catering to demand and evolving trends
He says the overall mission is to offer the breadth of products and services clients expect nowadays, adapting to key trends in the Thai market. “Many more clients want global exposures,” he reports. “The easiest way is to find a local fund that invests in global funds, this is the Thailand FIF or Foreign Investment Fund product. But they can also be more adventurous and trade global stocks, through us, and we also offer direct access to offshore mutual funds directly. They have more choices, and the costs are more efficient. If they want to hand it all to us, we have a service that manages the client's global investments as well.”
He explains the diversification is driven by the realities of the financial world today, with extremely low interest rates, high valuations in so many markets and segments, as well as the fact that Thailand has been hit hard by the pandemic, especially in the leisure and hospitality sectors.
Transitioning to new economy investments
“Moreover, we see investors transitioning from older economy stocks to newer economy investments, and Thailand is somewhat old economy to be frank,” he reports. “And the performance of the Thai market in the past two to three years has been poor, including previously solid sectors such as REITs, which were considered low risk and solid, but that have slumped and suffer very low liquidity. In all, there are plenty of incentives to expand portfolios globally.”
Looking at the bigger picture of the wealth market in Thailand, Jon says he is pleased with the way in which the firm has become more client-centric and more diversified in terms of its products, services and advice.
“In all three of these areas, we have significantly enhanced our offering,” he reports. “In particular, I should highlight advisory, which is now much sharper and more dynamic, and the private assets business, which we see as beneficial for wealthier clients, as the public markets are volatile and highly valued.”
“Overall, we have been seeing robust growth of 20% or more across our businesses in the past year or so.”
Jon lists his three key priorities for the year ahead as improving the client experience, boosting efficiency and improving advisory.
“We must improve on our client experience,” he explains. “So far, when we offer a product, when we have something new to offer, it is somewhat piecemeal, but my mission is to make this all more seamless and smoother for the clients. So that is number one.”
The second objective is to improve the work efficiency of the team.
“The pandemic has shown us many areas where we can improve, and we have made good strides forward,” he reports. “Now we need to take it all to the next stage so that we can enable sustainable growth, rather than feeling stretched to cope with the demands and the growth. We are making the right steps and we will surely reach our goals in this regard.”
The third key mission is to improve advisory and its delivery. “This must be better, and also easier for the clients to access and consume,” he says. “We want this to be more interactive, faster, more relevant and more engaging.”
Ready for the future
He closes the conversation by noting that competition is also increasing, with new arrivals such as the late October announcement by Bangkok Bank and Geneva-based global wealth and asset manager Pictet Group of their new strategic alliance to enhance wealth management services for Bangkok Bank’s wealth clients in Thailand.
“This is just one example of the challenges we are seeing in this industry,” he says, “but there remains a lot of potential – for example the regulators are more accommodating to overseas investment - and we are now much better positioned ourselves to seize those opportunities. We might not have the global reach ourselves, but we are very well established with our clients, and we are further expanding the platform and advisory for global investments and expect to narrow the gap with the global players.”
Getting Personal with Jon Wongswan
Jon is Managing Director and Head of Investment Solutions Department at Kiatnakin Phatra Securities, where he oversees investments and product selection for the Wealth Management Department. Jon joined Phatra in 2010 and was Head of Hedge Fund Department which managed systematic investment strategies in Thailand and Asia. Prior to joining Phatra Securities, he had worked for three years at Barclays Global Investors in San Francisco. He was a quantitative researcher in the Scientific Active Equities which managed global active equity products, including global hedge funds in both developed and emerging markets.
He also spent five years as an economist at the U.S. Federal Reserve Board in Washington D.C. where he was responsible for conducting policy work and researching on international financial markets. Jon graduated with his BA in economics from the prestigious Chulalongkorn University, and holds a PhD in economics from Duke University in the US.
As one might have guessed from his background rather than from his name, Jon was in fact born in the US, but was then educated mostly in Thailand until he returned to the States for grad school.
“I was born in Florida, my parents had met at the University of Florida when they were in grad school, they got married, I arrived while they were there, and we all came back to Thailand when I was about three,” he explains. “After grad school, a memorable time was working for about five years at the US Federal Reserve in Washington DC, a great place to work and live. That led me on to three years at Barclays Global Investors, the asset management arm of Barclays Bank, where I immersed myself in the quant hedge fund business over there in San Francisco, another wonderful place to live. Then I headed home to Bangkok.”
Jon is married and they have three children aged seventeen and thirteen, the younger ones being twins. “Exercise is my go-to relaxation,” he reports, “and I enjoy tennis, badminton, swimming, and running. Family times at home are great, we have a lot of fun and I also cook occasionally, and we love travelling when time and pandemics permit. If travel is easier, then next year it will be a beach holiday somewhere nice in Thailand.”
His final comment is that the stresses and strains of the pandemic in Thailand have helped him learn much about handling pressure. “With more time at home, one becomes more cognisant of making sure one has the right balance, that one relaxes at the right times and that one can shut down properly. It is not always easy when you are in the same place most of the time and usually home is the sanctuary, not the workplace. But I have adapted, and there are many positives that have come out of this.
More from Dr. Jon Wongswan, Kiatnakin Phatra Securities