Responding to changing times
Private Banking, Wealth Management, Investment and ETF Awards
It was not an easy year for wealth managers and private banks in 2018. After seven years of continuous growth, overall global high-net-worth individual (HNWI) wealth declined by 3% in 2018, largely due to a drop of US$1 trillion in wealth in the Asia-Pacific region, which accounted for a half of total global losses, according to Capgemini.
However, led by China, Asia was still the major powerhouse for global wealth generation in 2018, especially regarding HNWIs and ultra-high-net-worth individuals (UNHWIs), fueled by the rise of new wealth from sectors such as TMT, renewed consumer confidence, the young and the digitally savvy.
But with interest rate cuts, a trade war and bearish sentiment plaguing the market product providers particularly, structured products houses, derivatives houses, and ETF houses, had to broaden the investment product offerings for their Asian clients.
With the rise of a young wealthy generation in Asia, more wealth managers are looking to build up their digital solutions. On the private banking side, the growing number of traditional wealthy Asian families has led to an increasing need for maintaining wealth and family wealth inheritance in uncertain times such as the present. In recent years, more first-generation wealthy individuals have been considering passing on their businesses and assets to the next generation.
As such, to highlight the prevailing market trend, The Asset introduced new award categories such as “Best NexGen Private Bank” and “Best NexGen Wealth Manager” to recognize the private bank and wealth manager who have best demonstrated a strong focus and commitment to serving the special requirements of next-generation clients, particularly, cases involving succession planning, wealth transfer, facilitating intergenerational family communication, technology development, and solutions.
This year, The Asset received submissions from 74 institutions and took almost three months to process the submissions through intense pitch meetings, teleconferences and clients calls.
Investors have been seeking stable returns amid market downturn. Product providers with cross-asset structuring and sourcing capabilities stood out in being able to meet these needs
In 2018, bearish equity markets boosted activity in equity derivatives. The increasing participation of retail investors looking to benefit from a bearish market was a major driver of equity linked products and derivatives.
For the period from April 2018 to March 2019, which these awards cover, investors sought stable returns amid the market downturn. As a result, product providers with cross-asset structuring and sourcing capabilities stood out for being able to meet this requirement.
This year, The Asset has added new categories under the Index Provider Awards to highlight different index providers’ specialities. MSCI is recognized as Best Index Provider for Equity and Best Index Provider for ESG, IHS Markit is recognized as Best Index Provider for Fixed Income, and STOXX is recognized as Best Index Provider for Innovation.
Asia’s exchange-traded funds (ETF) market experienced several new developments over the past year that indicate further growth and sophistication.
These new developments are pushing ETF providers, brokers, market makers, index providers, and custodians to become more innovative and responsive to the evolving needs of their investors.
Despite increased volatility which resulted in outflows from some Asian ETFs, the use of ETFs continued to expand in the region due to new developments such as portfolio reallocation to equities, which, in turn, resulted in a growing preference for fixed income ETFs as investors diversified their portfolios away from equities; the shift away from active strategies to passive strategies, of which ETFs are the most basic; as well as the trend towards investing in environmental, social, and governance (ESG) assets.