Lawrence Lua, deputy head of DBS Private Bank, is very clear about the type of relationship managers he wants (and doesn’t want) in his team.
“I prefer to hire someone who fits into our culture long-term, rather than a short-term superstar who might generate revenue for a couple of years and then destroy the healthy environment here,” says Lua.
Lua believes that in some private banks RMs are “constantly competing and trying to outdo each other”. At DBS, which finished fourth among respondents in Asia in the eFinancialCareers Ideal Employer rankings, he wants respect, dependability and teamwork.
“We’re always willing to look at new bankers, but sometimes we turn people away because they’re not the right cultural fit,” says industry veteran Lua, who joined DBS in 2011 from Julius Baer and has also held senior positions at Merrill Lynch and Citi.
An RM at DBS must be business-minded, but also have a good risk awareness. “You must understand the broad needs of clients – not just focus on trading their money – and also have a great EQ and high levels of integrity,” adds Lua.
The banking requirements of wealthy people in Asia are changing, however, which is affecting the skills that RMs need to succeed at DBS.
Like UBS and Credit Suisse – but unlike boutique private banks – DBS RMs are now offering corporate banking and capital markets products, and opening up the firm’s balance sheet to entrepreneurial private clients.
“Our clients are often business owners with capital markets needs too,” says Lua. “Our RMs therefore must have a reasonably good nose for M&A and capital markets and must speak the language of their clients’ businesses,” says Lua.
“An RM should be able to say to a client ‘I understand your business needs, now let me bring in my specialist colleagues’. We don’t want narrow bankers who are only exposed to one or two products. We want people who can help with succession planning and have wider conversations with clients,” he adds.
Relationship manager headcount at DBS increased from 289 to 300 between 2015 and 2016, according to new figures from Asian Private Banker.
DBS Private Bank is taking on more RMs this year, mainly based in Singapore and Hong Kong, to cover its key Asian markets. It also plans to set up an office in Sydney, following the opening of its London branch in 2016.
But while firms such as Credit Suisse and Julius Baer are hiring RMs in bulk, DBS will be “selective”, says Lua, without providing a headcount target for 2017.
“We’re under no pressure to grow for growth’s sake,” he says. “Unlike some other private banks, we don’t have a hire-and-fire mentality. Our focus is on the productivity of our bankers – to ensure their success and the sustainability of our business – not mass recruitment.”
Rather than juniors, DBS likes to hire “seasoned private bankers with exposure to capital markets”, says Lua. “It’s nice if new recruits can bring some clients with them, but they have to face KYC compliance, so they can’t bring them all.”
Compliance is among the key challenges for the wealth management sector in Asia, says Lua. “In the old days margins in Asian private banking were better – now they’re getting tighter because of competition. Compliance and salary costs are going up,” he adds.
Asia also faces a talent shortage of relationship managers. “Demand for private bankers in Asia has risen substantially over the past 10 years as foreign firms have entered the market. The challenge is to hire RMs who can who can act like entrepreneurs and add value to clients and the bank – but all banks are looking for them, so it’s not that easy.”
Lua doesn’t think technology poses a threat to private banking jobs, however.
“A robot won’t replace you, another RM will. The next generation of wealthy people in Asia are demanding more from banking technology. But at the same time they want advice from private bankers,” says Lua. “Clients still love to talk face to face about their finances – they want an opinion, a personal service.”
Artificial intelligence will play an increasingly important role in private banking, says Lua. “But how do you get a machine to connect you to the capital markets or help you through an M&A deal? It’s the RM who connects these dots.”
Private bankers should “embrace” technology and see it as an “enabler” to better understand their clients, adds Lua. DBS’s new iWealth platform, for example, gives private clients easily accessible data and portfolio reviews via their mobile phones.
“We’re in the service industry and there’s only so much a machine can do. But we need to remain relevant and use technology to our advantage,” says Lua.
View the complete 2017 Ideal Employer Global Rankings.