Standard Chartered goes on hiring spree

Didier von Daeniken, global head of private banking and wealth management at Standard Chartered, says the bank plans to increase its assets by over $30 billion in the next three to five years. (Reuters)
Updated 15 August 2019

Standard Chartered goes on hiring spree

  • Private banking business caters to wealthy individuals across Asia, Africa, the Middle East and Europe

HONG KONG: Standard Chartered is targeting growing its private banking assets by half to about $100 billion in three to five years, whilst hiring dozens of bankers in Hong Kong and Singapore to do so, a senior executive at the lender has said.

The moves show StanChart has big growth ambitions for the private banking unit that had until recently weighed on the lender’s earnings, with its small size stoking speculation it would be put under review for possible divestment.
The lender will recruit 30-40 private bankers every year in the next two to three years to add to its roughly 300 existing relationship managers, and the bulk of the additions will be in Hong Kong and Singapore, StanChart’s global head for private banking and wealth management Didier von Daeniken told Reuters.
With $65 billion worth of private banking assets, London-headquartered StanChart is a small player compared with UBS which, as per Asian Private Banker data, had assets worth $2.3 trillion and Credit Suisse, with $770 billion last year.
The private banking business accounted for just 3.8 percent of StanChart’s total profit before tax in the first-half of this year.

"Our ambition is to see us cross the $100 billion mark. That makes us a meaningful player in this landscape.”

Didier von Daeniken, StanChart’s global head for private banking and wealth management

“Our ambition is to see us cross the $100 billion mark. That makes us meaningful internally for the group, that makes us a meaningful player in this landscape,” Daeniken said. “Hitting $100 billion can give us credibility internally, help us to attract talent.”
StanChart’s private banking business caters to wealthy individuals across Asia, Africa, the Middle East and Europe, through booking centers in Singapore, Hong Kong, Dubai, India, London and on the island of Jersey.
The unit had weighed on the group’s earnings in the recent past, as it sought to reposition the business to target rich individuals with at least $5 million in investable assets amid stiff competition in Asia, which brings in bulk of its revenue.
Underscoring a potential turnaround, StanChart’s private banking business posted a pre-tax profit of $100 million in the first half of this year, compared with a loss of $5 million in the same period last year.

HIGHLIGHTS

• StanChart to hire 30-40 private bankers per year.

• Bank currently a small player in private banking, with $65bn assets.

• Speculation earlier that small size would force bank to review business.

StanChart’s private banking return on tangible equity, a key measure of profitability, increased to 15.7 percent in the first half of the year compared to a negative 1 percent in the year-ago period, its latest financial report showed.
As part of the plans to bolster assets under management, the private banking unit plans to tap more of the group’s corporate and institutional banking clients in Asia and other emerging markets where it has existing banking networks.
“With $65 billion we are definitely not among the largest, but we are part ... of a company with a large balance sheet, with an unmatched presence locally in all the markets, which really matters when you cover the emerging markets,” Daeniken said.
In the near-term, however, concerns about the global economy and 10 weeks of protests in Hong Kong that have plunged the Asian financial hub into its worst crisis had made clients “more prudent” in their investment decisions, he said.
Daeniken added StanChart’s private banking unit had come a long way “but the task before us is as difficult because we really have to maintain the momentum in a difficult market environment.”


Frank Kane’s Davos diary: Swiss efficiency lapses, but so far Davos lives up to the cuckoo-clock image

Updated 22 January 2020

Frank Kane’s Davos diary: Swiss efficiency lapses, but so far Davos lives up to the cuckoo-clock image

Davos comes and Davos goes, but over the last five decades, the one thing you can rely on is Swiss efficiency, right? The trains run on time, the cuckoo clocks chime on the hour, and the snow is swept from the pathways within minutes of the first fake falling. That is the common (even cliched) view of the Alpine nation and its showpiece event, the World Economic Forum (WEF) annual meeting in Davos.

But — and whisper it very gently beneath your breath — maybe the legendary standards of Swiss efficiency are slipping as the WEF celebrates its 50th birthday. Evidence of a lapse from the highest levels of attainment came at Zurich Airport, when the luggage belt seized up inexplicably, and a full 10 minutes elapsedbefore a maintenance man came to attend to it. Tut tut.

Further signs of falling standards were on display at the railway station. The booking desks were besieged, as usual, by WEF delegates keen to complete the final leg of their journey up the Magic Mountain — a two-hour rail journey involving two stops at increasingly higher altitudes.

But only two of the 10 grills were manned, and the line grew longer and more grumpy with each passing minute. The mood was not helped when some trains were canceled and an extra hour was added to the journey. There was much muttering and dark looks shot when the train finally pulled into Klosters.

But thankfully, once you got to the heart of WEF-land, normal service was resumed. There had been a reasonable fall of snow that morning, which gave the place its usual fairytale appearance, but no traffic snarl ups as in previous years, when massive snowfall had caused the place to grind to a halt.

The shuttle buses that are the arterial life-channels of Davos — for those whose budgets do not extend to the black Mercedes limo — were running with their usual Swiss punctuality: Every 10 minutes or so, or even more frequently during peak rush hours.

These, in my experience over the past few years, are becoming frequently extended. Having battled through the registration process and attended one event at the nearby Seehof hotel, I imagined it would be easy to catch a ride on a virtually empty shuttle back to Klosters at around 9.30 p.m. But even at that hour, there was a long queue of unhappy souls waiting to make the same 20-minute trip to the other side of the mountain and their warm, welcoming hotel rooms.

It was the same thing on the opening morning of the annual meeting. I left my hotel — the homely and comfortable Cresta in Klosters — at 7 a.m. in the dark, and at minus 5 degrees Celsius. Again, there was a crowd of people standing huddled at the shuttle stop, shivering and stamping their feet.

The WEF shuttle service was up to the job, however, and I got into the Congress Hall with little trouble. The airport-style screening process — maybe a little more thorough than usual in view of the impending arrival of US President Donald Trump — passed smoothly. One request though: Please WEF, install some hot-air machines in the security hall. The body shock when you remove outer clothing to pass through the metal detectors was wicked.

Then down to business, which for a journalist at Davos means finding somewhere in the congress complex where you can rest a laptop while also providing a good people-watching vantage point. Over the years, I have learned that the Central Lounge — strategically located between the main plenary meeting halls and the (private) members lounge and bilateral rooms — is the perfect spot. Now, who will come my way in Davos 2020?