UBS targets Asia for Wealth Management Growth

Posted by Anton Murray Consulting on 31 Mar, 2015

Matthew Miller

UBS AG (UBSG.VX), the world’s biggest wealth manager, expects Asia Pacific assets to account for as much as 30 percent of the funds it oversees within the next 10 years, the Swiss bank’s chief executive said.

UBS’s wealth management business looked after about $2.04 trillion (1 trillion pounds) in invested assets at end-2014, half of which in the Americas, according to bank filings.

“I wouldn’t be surprised if the Asia business is closer to 30 percent (of the bank’s total managed assets) than the 10 percent it is today,” Chief Executive Sergio Ermotti told Reuters in a recent interview.

Chinese wealth creation will drive much of the bank’s expansion in the region. Net new money from the Asia Pacific region, including Japan, amounted to 26.7 billion Swiss francs (19 billion pounds) over the last four quarters, compared with $10 billion in the Americas, the bank’s latest financial report shows.

“We do expect wealth creation to be a big theme in China,” he said. “The Chinese business is a very big business and a very important business, in terms of profitability and scope and size.”

According to the Boston Consultancy Group, private financial wealth in China, where the number of millionaire households reached 2.38 million in 2013, is expected to grow 84 percent by 2018, from $22 trillion to $40 trillion.

Ermotti, in Beijing for a forum, said it was important for China to further open up its capital markets, and particularly its debt capital markets, to reduce the economy’s reliance on banks for financing.

He also said UBS, which employs about 500 people in China, plans to “substantially increase” that number over the next decade, with the majority of new hires in the wealth management business.

“The story for many years was how to bring foreign investment into China,” said Ermotti. “The next step is how we can help Chinese investors go outside of China.”

UBS operates a domestically licensed bank in China, a wholly owned asset management company, and holds a 49 percent stake in UBS SDIC Fund Management Co.

The bank last purchased a Shanghai-based futures operation, and is expected to open a Shanghai branch, targeting wealthy individuals, before the end of the year.

Reuters

Latest market insights

Why nuance matters in ESG investing

› Read more

Fed issues warning to banks over crypto-assets

› Read more

Asset managers urged to adopt uniform ESG standards

› Read more

Greenwashing concerns dampen ESG enthusiasm

› Read more

Asset managers urged to adopt uniform ESG standards

› Read more

Twitter feed

This is an exceptional Unit Pricing Analyst position, working for a highly-regarded super fund based in Melbourne on an initial 6-month contract: http://ow.ly/roiP50MK80k

Why nuance matters in ESG investing: http://ow.ly/3UjJ50MK7Ev

Our client is a leading Australian financial institution seeking an experienced and knowledgeable Treasury Operations candidate to join and lead their small Treasury Ops team: http://ow.ly/Syuv50MIBIh

Our client is a leading fund that invests directly and indirectly in all major asset classes. They are seeking candidates with performance analytics experience for a contract role in Melbourne: http://ow.ly/NyJb50MICrQ

Sign up to our newsletter

Sign up to our newsletter

"*" indicates required fields

By subscribing to our newsletter I agree to the collection, use and disclosure of my personal information in accordance with our Privacy Policy