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Private banks EFG, VP Bank to raise headcount in Singapore

Private banks EFG, VP Bank to raise headcount in Singapore

SINGAPORE: Lichtenstein-based VP Bank and Zurich-based EFG are planning to hire more staff in Singapore. Private bank VP Bank, which has been in Singapore since 2008, currently employs about 40 staff here and told Channel NewsAsia that it aims to double that figure within the next two to three years. EFG did not quantify its staff expansion plans but told Channel NewsAsia in an interview that it is driven by the demand it has observed for specialised services in Singapore like succession planning – which is one key area the Swiss private bank expects to tap on to grow its business and client base. Mr Kong Eng Huat, CEO of EFG’s Singapore unit, said: “Look at the ageing population, a lot of business entrepreneurs are in the process of transferring their wealth to the next generation, so we are making sure we have enough in house expertise. The boomers are now in the position to pass on their wealth to this second generation. With over 200 people, we will continue to grow the staff that we have over here.” He said that the pickup in global activity is also a key tailwind.

“The Asian economies are all doing well and we’re talking about 5 to 7 per cent growth and that translates into opportunities for wealth management providers. Also, the high net worth are getting richer and there are more global investors.” Mr Bruno Morel, CEO of VP Bank Singapore, agrees with Mr Kong that there is growth opportunities in Singapore. “All the statistics confirm it, we see the population of wealthy individuals growing and their individual wealth is growing too. On the intermediaries, we can see a lot of new setups – family office, external asset managers opening boutique entities here in Singapore.” EFG clients include high net worth individuals with investable funds of over US$10 million (S$13.6 million), while VP Bank said it caters to the needs of HNWIs with “assets in excess of S$2 million”.

Both banks also said the city-state’s strong regulatory landscape attracts more people to place their assets here, but noted it meant that private banks may incur higher compliance costs. Mr Kong said: “Obviously there is consolidation going on for the last two years and that will continue, the reason is because the business environment to operate a private bank is getting more challenging – first you need scale, you also need to invest in all the technology and also making sure that you can effectively comply with regulations.” Mr Morel said: “The regulators have been very active in producing new regulation and of course it takes us time to implement them and to modify our system, and what we observe is when we finish with implementing one regulation, the new one would already have arrived.” The greater regulatory scrutiny on private banks here follows the collapse of Swiss private bank BSI in Singapore over dealings related to Malaysia’s scandal-hit 1MDB state investment fund.

Meanwhile, VP Bank also noted that there continues to be strong competition for talent in the industry but is confident that its business model will thrive and propel growth in Singapore. “It’s a very competitive market so there’s pressure on margins in order to gain market share. We focus on the quality of service and not on the market share and our best reference for new clients is our existing clients,” said Mr Morel.  Looking ahead, both banks said they are not ruling out acquisitions to accelerate growth in Singapore and the region.