Cathay Private Bank has only been around for three years, but has seen major growth and has set itself on a path to sustainability. In order to survive in Taiwan's private banking industry, which is one of the most fragmented and competitive markets in Asia Pacific, the new private bank is going to have to truly differentiate itself from its competitors.

John Huang, the CEO of Cathay Private Bank who was a former consultant at McKinsey with experience from UBS and Credit Suisse, believes the bank can leverage the product lines and resources of Cathay Financial Holdings to provide a wide array of innovative products and services to its clients. But he faces challenges internally. He needs to get all the right people within various departments on board, and have them work together to build the bank.

Leveraging Cathay Life Insurance

One of the first goals of Huang was to leverage Cathay Financial Holdings life insurance company, Cathay Life Insurance, which is the largest life insurance company in Taiwan, to bring new solutions to its clients.

"As Cathay financial holding owns the largest life insurance company in Taiwan, which has the largest insurance premiums collected, we have leveraged the company's professional team's buying power to source customized solutions, highly sought after products and institutional pricing and execution to meet our clients' investment need," says Huang. He added that he is going to continue to work with the Cathay Life Insurance's professional team to bring alternative investments to his clients.

"In the future we plan to work closely with this professional team and leverage their investment expertise to co-invest (on clients' behalf) in various highly selective alternative solutions within the regulatory framework which were recently liberated to PB/WM thus allow many unregistered solutions for the first time to come into Taiwan," adds Huang.

Huang has been working with other major departments of Cathay United Bank, including risk, retail, and wealth management to build his private banking team. According to Huang, many of the people who are with him in the private banking department have decided to join him on his journey to build the bank's private banking department.

"We have forged key partnership with several key internal organization where ideas were shared openly and solutions were formulated based on group discussions. A key measure of success can be seen by a number of internal Cathay Bank employees who had worked with the private bank on various aspects and who have decided to join us as member of the team. We have now recruited such talents from credit, trust, consumer banking, branch operations, credit operations, risk, accounting, technology and corporate planning," notes Huang.

Breaking through silos and getting people on board

The private banking industry already has major players, including CTBC Bank, Taipei Fubon Bank, Taishin Bank, and even foreign banks such as Citi and UBS. But Huang does not think that the competition is his main challenge, as he is sure that Cathay Financial Group's unique footprint in the market can be leveraged to become a top player. His main challenge is breaking through the silos throughout the company and getting everyone to help build the private bank and educate them about its goals and importance to the group.

"The private bank is a new venture where the bank has minimum in-house experience thus in the initial phase acquiring the key private banking know-how as sourced externally. But bridging the external private banking know-how (mostly from the foreign banks, include both onshore and offshore experience) with local bank structure and role and responsibility was not easy to do," he adds.

Huang now spends a lot of time educating other departments within the bank about private banking to get the support he needs to build the bank. "We had to host many workshops to explain to both management and other important teams about what private banking is all about. We talk about how we need various departments to work together such as integrating our products, platform and services from various in-house departments under different management. This is a challenge," he adds.

Cathay Private Bank is still in an early stage, but if Huang can continue to attract talent from other departments and banks, and continue to leverage the resources and networks of Cathay Financial Group, the private bank will continue to see growth in Taiwan.