Morgan Stanley’s James Gorman seems to have been channeling one of his rival CEOs: Tidjane Thiam of Credit Suisse. Thiam is, of course, particularly keen on building up his firm’s Asian wealth business – and now Gorman is, too.
Gorman wants to grow Morgan Stanley Private Wealth Management in Asia, where it currently employs about 315 relationship managers. “That’s where I’d like to invest – Hong Kong, Singapore – go hard at it,” he told a conference in New York this week, according to the Financial Times.
His speech confirms that the US bank’s recent expansion announcement in Asian wealth management has C-level backing. In January, Vincent Chui, Morgan Stanley’s head of wealth management in Asia, said that the US bank plans to take on 50 relationship managers in Hong Kong and Singapore over the next three years. Chui separately told Asian Private Banker that month that Morgan Stanley is “as keen as our competitors in terms of talent acquisition”, despite his stated aversion to inflated compensation packages and “over-expansion”.
While Morgan Stanley is already one of the largest wealth managers in the US, the firm sees room for growth in Asia, where it is a medium-sized player, ranked fifth by regional assets under management in 2018 ($105bn). First-placed UBS, by contrast, manages $357bn.
What kind of RMs does Morgan Stanley want to hire in Hong Kong and Singapore? Gorman provided some hints this week. “Clients in the ultra-high-net worth space are effectively what I call walking institutions. They operate like family offices, endowments…That business is growing nicely,” he said.
Morgan Stanley’s ultra-high-net-worth (UHNW) strategy in Asia is long standing, and sometimes restricts it to recruiting from banks such as UBS, Credit Suisse, Julius Baer and JP Morgan, which also serve the segment. As we reported in April, Morgan Stanley poached Hong Kong-based Pradinan Arkarachinores, a senior Julius Baer relationship manager with UHNW Thai clients.
The bank’s growing focus on family offices is more recent. It was flagged as a business priority by Chui earlier this year, who noted an increase in wealthy Chinese entrepreneurs setting up offshored family offices, particularly in Singapore. “Morgan Stanley will definitely be looking for RMs with a good network of Singapore-domiciled Chinese clients, or Chinese clients with the potential to set up family offices here,” Lucas Yeo, head of banking and finance at recruiters Tangspac in Singapore, told us at the time.
Private bankers who join Morgan Stanley as part of its new Asian hiring drive, may find the firm a little different from what they’re used to. “They must be very independent and able to function as investment advisors to their clients, without the luxury of always having specialist advisors assisting them,” says Liu San Li, a former private banker, now a business partner at wealth management firm Avallis in Singapore.
The firm has been on recruitment sprees in Asian wealth before – in 2017, its regional RM headcount shot up by 51.
Away from private banking, Morgan Stanley cut about half a dozen mid-level equity sales, trading and research jobs in Asia (including in Hong Kong and Singapore) in May, as part of a global cost-cutting drive, according to Reuters.
Image credit: Getty
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