At a roundtable discussion in Hong Kong in March 2012, co-hosted
by Hubbis and J.P. Morgan, some of the leading EAM / IAM companies in
Hong Kong came together to discuss and debate the various opportunities
and challenges they face as part of this evolving segment of the local wealth
management landscape.
This covered key aspects of how to ensure further growth and greater awareness of EAMs / IAMs, including the need for: more realisation by clients of
the benefits of ever-important characteristics such as independent and transparent service; more advice relating to the next generation; more ways to
address issues relating to the mindset of many Asian HNW clients in terms of
paying fees, as well as to the relatively limited product range on many platforms; more understanding of the different banking and advisory offerings
available; and more investor education.
Stefano Fiala
Chief Executive Officer
Veco Invest
Philippe Legrand
Chief Executive Officer
London & Capital Asia
Our co-host for this roundtable:
Lemuel Lee
Executive Director
Customized Solutions
Derivatives Marketing
Asia Ex-Japan
J.P. Morgan
T 852 2800 7873
E [email protected]
Joe Attrux
Chief Executive Officer
Harris Fraser Group
Alison Lo
Managing Director
Target Capital Management
Alex Walker
Director, Wealth Management
Financial Partners
Sanam Ramchandani
Deputy Chief Executive Officer &
Founding Partner
London & Capital Asia
Marc Geary
Head of Private Wealth Management
Harris Fraser Group
Alice Yim
Target Capital Management
Lemuel Lee
Executive Director
Customized Solutions
Derivatives Marketing
Asia Ex-Japan
J.P. Morgan
Peter Lee
Managing Director
Veco Invest Asia
Stefano Fiala: EAMs have been
able to provide the kinds of tailormade services which banks cannot
easily offer to their clients.
We also have no hidden costs because
transparency has been a big selling
point to clients. The true open architecture style is another advantage of
the EAM model.
Philippe Legrand: It is also interesting to note that while the IAM industry
has historically been marketed from
Switzerland, the model has also grown
strongly in the US and the UK.
Stefano Fiala: However, growth
in the EAM industry in Europe is very
slow as a result of the large number
of competitors which now exist in this
space, plus the economic environment
makes it difficult to find new clients.
As a result, we have come to Asia –
and specifically Hong Kong – to find
what might be one of the few real
growth areas where we can try to replicate our success in Switzerland.
We are using a similar business model,
although we need to adapt it to the
needs of the local market’s investment
culture and stage of development.
Philippe Legrand: I think the IAM
model is the best approach to service
the consolidated needs of wealthy
Further, at a time when investment
banks are resource-constrained to
look at some of the smaller corporate
deals which Asian entrepreneurs are
looking to pursue, this provides an
opportunity for some IAMs, which are
structured along these lines, to advise
HNW clients.
Veco Invest
London & Capital Asia
One of the problems private banks
face today relates to the compliance
requirements imposed on advisers when
they are servicing their clients.
Asian families. In addition to their
liquid assets, these clients also have
real estate and their businesses which
need looking after.
Stefano Fiala
Philippe Legrand
Alex Walker: As the market becomes
more sophisticated, we are also seeing
a trend where HNW and UHNW clients
are seeking an “independent” alternative to managing some of their wealth,
thereby diversifying their management
risk, as opposed to just placing all
their wealth with a few private banks.
Marc Geary: While brand value remains important for a lot of Asian clients, which is why the larger or betterknown private banks have been able to
be successful to date, their businesses
are now under a lot of pressure.
Alex Walker: If clients know they can
turn to an experienced EAM adviser to
Sanam Ramchandani: One of the
problems private banks face today relates to the compliance requirements
imposed on advisers when they are
servicing their clients.
This means that conversations with
clients are not only about their needs
as so much time must be spent on
suitability and internal administrative
issues of the bank.
Marc Geary
Harris Fraser Group
have a holistic discussion about their
financial and personal affairs, they are
more likely to trust their adviser and
be more comfortable in relying on their
advice over time. This is something we
at Financial Partners have been working on over the past few years, focusing on the “trusted adviser” approach.
Marc Geary: The value-add of an independent service is the high transparency as well as the service itself.
I think clients will increasingly move
away from the bank proposition that
exists today.
Alex Walker: It is also very important
to highlight the areas of value-add to
the client, especially in areas the client may not perceive initially when assessing the value proposition.
They are becoming more cooperative,
and this over time will also enable the
EAM industry to develop.
Alison Lo: I think there is a rewarding prospect for the EAM industry in
Hong Kong given the growth of HNW
individuals in Asia, especially in mainland China.
To understand what investors need
is a long process. In choosing their
“right” investments out of many of the
existing choices, they will work with
This includes, for example, our ability
to know what not to do and who not
to deal with. This is especially important in a market like Asia, given that
it is not very transparent and also it is
often fragmented.
professionals like us who are truly
independent. During such a relationship-building process, we build trust
and at the same time add value to
them – all these are positive for the
development of the industry.
This market intelligence applies not
only to EAMs assessing other advisers,
but also trustees, tax specialists and
accountants, for example.
Alex Walker: At the same time, with
the trend in inter-generational wealth
transfer underway in Asia, I see there
being more and more opportunities for
independent firms in advising the next
For clients to see the value in EAM services will take more education by all
EAMs and multi-family offices.
Peter Lee: More and more banks are
putting in the resources to developing
Alison Lo
dedicated EAM desks, with a larger
range of products and more efficient
The younger generations who are inheriting the wealth typically don’t
want to work 7 days a week like their
parent(s) did originally to build the
If IAMs can prove their differentiation in
terms of the quality and independence of
advice, then we will increasingly start to
receive fees for this.
Target Capital Management
lot of decisions themselves and being
in control.
Philippe Legrand: When I first
moved to Hong Kong in 1995, in the
early days of private banking in Asia,
we charged clients advisory fees.
This changed as markets matured and
interest rates fell. But a big contributor to the difficulty in continuing to
charge clients fees has been that they
increasingly have perceived less value
in the advice they have been given.
Lemuel Lee
J.P. Morgan
wealth. Instead, they want to enjoy
a more balanced lifestyle and therefore are more inclined to outsource
the management and administration
of their wealth to reputable EAMs and
multi-family offices.
Alison Lo: Apart from wealth generation, people in China also see the
importance of wealth protection. In
addition to a relatively new concept
of EAMs in Asia and their urge for a
better understanding of investments,
there is a wide scope of potential for
providing investors with investment
education and a better understanding
on what wealth management really
means to them.
Lemuel Lee: This is also a result of
the fact that for many years client
have shopped around the various brokerages in search of the best prices,
so they now apply this approach to all
aspects of their investing and wealth
Philippe Legrand: If IAMs can prove
their differentiation in terms of the
quality and independence of advice,
then we will increasingly start to receive fees for this.
For other types of services that IAMs
might offer, however, Asian clients are
willing to pay a retainer fee. For example, for our corporate advisory ser-
Peter Lee: In terms of product offering, I would like to see more of the
private banks starting to better understand what EAMs want and need from
them as custodians – specifically in
relation to the fact that we operate a
true open-architecture model.
When we trade on their platforms, it
doesn’t mean we want to only trade
their products. Instead, their platforms should enable us to trade a
range of products.
A few banks are starting to understand
and respond to this, which is a positive
step, but we need to see more of this
across the market.
Peter Lee: Although many private
banks are now trying to take the relationships with clients out of the hands
of just one individual, to implement
more of a team approach, not all clients are happy with this.
This is because it means there are
then multiple individuals serving them
and they don’t feel they are getting
the personal touch they want.
Sanam Ramchandani: In addition,
for those banks which take a productcentric approach, it is like walking into
a client meeting pushing a trolley full
of dim-sum and offering the client one
or another of the various dishes.
Lemuel Lee: One of the things that
I see EAMs find challenging is dealing
with the mindset of the typical Asian
HNW client.
For example, a lot of clients don’t
want to pay a flat-fee for services, as
the individuals are used to making a
vices, clients perceive value in being
able to pick up the phone or meet with
us and discuss their corporate advisory needs.
Peter Lee
Veco Invest Asia
And regardless of whether the client is
a vegetarian, or can only eat gluttonfree foods, the adviser is trying to sell
like us, they would get the additional
services we will offer them.
Alex Walker: We can offer the same
level of custody plus the additional
level of services and personalised attention for clients; something that
many private banks now struggle with
and will find it difficult to recover going forward.
Philippe Legrand: It is also a question of providing a service that clients
are looking for.
Sanam Ramchandani
London & Capital Asia
a certain amount of dim-sum, so continues to keep pushing it to them.
Philippe Legrand: The entry points
to a relationship with a client are very
important. IAMs have the ability to
create more than business or investment focus points with each client,
which gives us, as a firm, more points
to develop and retain the relationship.
Alex Walker: For individuals with a
quantum of wealth, the dilemma is
what to do with it and how to manage it.
There is either a lack of alternatives,
or too many options, and only a seasoned professional can wade their way
through the fog. This is where the biggest opportunity for EAMs exists – offering genuine value-add to clients.
Marc Geary: One of the things which
I find resonates with clients is when
we sit down with them to analyse their
various bank accounts, and we strip
out the fees they are really paying
on their private banking products and
They can then see what they are really
being charged compared with what we
would charge them. Plus with an EAM
Private banks tend to include everything in one packaged platform: custody, advice and execution.
Whether this package offers open architecture is open to debate as this
isn’t always the case with every firm
anymore. But offering only this package doesn’t give IAMs as many options
as we want.
I think there will be more and more
banks entering this space which will
be willing to offer just access to either
their custody or execution platforms.
If they can deliver on this, and clients
are comfortable with those names acting as custodian, then the market will
change completely and become much
more efficient.
Alex Walker: There is also a need
for education to be supported through
regulation, and to a certain extent, the
responsibilities for investor education
also fall on the regulators.
For example, in markets like the US,
Australia, the UK and Canada, the
regulators’ websites act as education
centres and conduits where individual
investors can find details of advisory
firms and individual advisers, and can
understand the right questions to ask.
Hong Kong is evolving three-times as
fast as when compared with the more
developed markets, when they were at
the equivalent part of their own financial services cycles.
It is with this in mind that the evolution of regulations and the implementation of these in relation to the EAM
industry needs to be considered. In
particular, they need to be given more
attention as the EAM business concept
is still quite new in Asia.
The EAMs themselves also play a part
in working with the respective regulators and helping to develop the industry as a whole.
Sanam Ramchandani: To enable
the industry to develop more quickly,
and widely, there needs to be better
awareness and understanding among
clients of the IAM model.
This includes why they need this type
of service and the benefits that they
can get from it.
Alex Walker
Financial Partners
Contact details and company profiles of participants
Stefano Fiala
Chief Executive Officer
Veco Invest
Philippe Legrand
Chief Executive Officer
London & Capital Asia
Joe Attrux
Chief Executive Officer
Harris Fraser Group
Peter Lee
Managing Director
Veco Invest Asia
Sanam Ramchandani
Deputy Chief Executive Officer
London & Capital Asia
Marc Geary
Head of Private Wealth Management
Harris Fraser Group
VECO INVEST is an independent asset management firm founded in 1988
and is a member of VECO Group SA
(est. 1973), serving clients in Asia,
Europe and Latin America. We provide independent asset management
and investment services in Hong
Kong, Lugano and Zurich. Our Group
has a presence in over 10 countries
worldwide offering services in asset
management, trust and foundations,
multi-family offices with the highest
level of independence and discretion.
We aim to provide personalised and
tailored 360-degree solutions to meet
our clients’ needs.
London & Capital Asia is an Independent private wealth manager / investment banking boutique that aims to
provide tailor-made services to answer
the financial needs of private families
and institutions.
Harris Fraser Group is a boutique provider of wealth management solutions
for high net worth individuals, their
families and charities. Harris Fraser
assists clients to build and preserve
their financial wealth by delivering superior strategic (goals-based) advice
and risk-adjusted returns to investors.
With offices in London and Hong Kong,
the Group has over US$3 billion of
funds under Management; it is 100%
employee owned and is SFC (HK), SEC
(US), and FSA (UK) regulated.
Contact details:
E [email protected]
Contact details:
E [email protected]
Contact details:
E [email protected]
Contact details:
E [email protected]
Contact details:
E [email protected]
Contact details:
E [email protected]
Contact details and company profiles of participants
Alison Lo
Managing Director
Target Capital Management
Alice Yim
Target Capital Management
Target Capital Management Limited
was established in Hong Kong in 2006
as an external asset manager to provide comprehensive financial services
and solutions to private clients with
focus in Asia. Our philosophy is professionalism and long-term commitment in the private banking industry.
Contact details:
E [email protected]
Contact details:
E [email protected]
Alex Walker
Director, Wealth Management
Financial Partners
Financial Partners Ltd was established
in 1988 and is Asia’s oldest independent wealth management firm providing advice to individual and corporate
clients based in Asia, Australasia and
Europe. Ownership of the business is
retained by staff to ensure interests
are aligned with that of the client and
Equities & Freeholds Ltd (EQF), a listed company on the ASX.
Financial Partners remains at the forefront of the independent wealth management industry by offering an open
architecture platform that provides clients access to over 260 different products and services.
Financial Partners also prides itself on
being able to offer tailored, transparent fee and service levels to match
each client’s needs. The firm is committed to being market leading and is
constantly looking at new ways to add
value to the management of a client’s
financial and personal affairs, whether
this be on a retail level or with our
business partners.
Contact details:
E [email protected]