00:00Obviously, you oversee the China business for the Singaporean bank, DBS.
00:04That's right.
00:05What is your priority this year amid, obviously, the noise geopolitically,
00:11the tumultuous nature of the Chinese economy trying to gain some footing and some confidence and end deflation?
00:18What is your priority right now?
00:21Thank you, Stephen. Thank you. Thank you for inviting me to join you here in Shanghai.
00:26Maybe I talk about some good things first.
00:29Our strategic priorities. First of all, I think wealth management becomes a very important initiative for DBS China
00:36and also for the group. I think there is a permanent shift of the wealth management industry in China.
00:46The high net worth individuals are more matured and they look for safe assets and diversification of asset allocation.
00:54So a diversification more to safety because of the uncertainty or what?
00:59And also because they learned a lot of lessons in the past few years because of a rare estate, the trust products and all these.
01:06Right. So so I feel this is a permanent shift of the mindset of the investors.
01:11So they look for safe assets, especially they look for offshore asset allocation.
01:16This creates a lot of opportunities for somebody like DBS, who has a headquarter in Singapore and we're also very big in Hong Kong.
01:24Right. So this is I see that this trend will continue for many years to go.
01:29So where does that lead to the inevitable question of hiring private bankers?
01:34We did see a number of about 40 new bankers by the end of this year, largely in Singapore, because you've already built up Hong Kong.
01:41That's right. That's right.
01:42But how about on the mainland as well?
01:44OK, for mainland, I think we still have a lot of opportunities because, you know, a lot of people's wealth still in China.
01:50They can't move everything into Hong Kong and Singapore.
01:53So what we're trying to do is that we'll hire more fresh graduates and also we'll train up our own relationship managers.
02:01In fact, 10 days ago, our group CEO just opened our new international treasures wealth centre in Shanghai, which means we upgrade our branch into a wealth centre
02:12and also try to connect them with international asset allocations, the knowledge, the know-how and expertise of a DBS group.
02:22So we're trying to do that for other branches in China in the coming three years.
02:27Now, a lot of the mega rich, if you will, in China who are looking to diversify and looking to go overseas as well, they tend to be younger than the average billionaire, if you will, in the West.
02:41Sometimes by as much as 20, 30 years even.
02:43So we're talking 30-year-olds, 40-year-olds.
02:46So how is their risk appetite different now and given their age and their ability to have many more years of growing?
02:54So are they going into much different products and is that what you're offering, a much different portfolio?
03:00Those are typically, whether it's the new tech money or they could be the second or even third generation of, you know, the entrepreneurs here in China.
03:10Those people are pretty sophisticated.
03:12Typically, they're educated in overseas.
03:14So they have a very strong mindset of how to manage the risk and how to do the allocation compared with their, you know, fathers or grandfathers.
03:26So I feel that they look for someone who can give them advice, you know, how to reinvest their money.
03:34And they're also very international, as I mentioned, that typically educated in overseas.
03:39So they will buy in someone who can provide a valuable advice to them.
03:45So that's why I think international banks in this area will play a very important role.
03:50What kind of assets under management are you looking at for where there's the family offices and also your overall wealth management portfolio for this part of the world?
04:00I saw a number for the family offices at about a billion dollars AUM.
04:07Is that the ballpark?
04:08And what are your targets?
04:10In fact, for China, that our starting point is not very high is the treasures like in Singapore and Hong Kong is typically the R&B 1 million AUM as a starting point.
04:21Of course, someone would put more money with us.
04:24And in China, we offer a diversified product like funds, insurance and even U.S. dollar equities or Hong Kong listed equities through QD and other structural product.
04:37So this also differentiate ourselves with Chinese banks who are also very focused on wealth management.
04:45And in Singapore, Hong Kong, of course, we have a very big presence in the full range of wealth management segments, right?
04:52Treasurer's TPC and offer private bank so they can offer, you know, all type of products in the global market.
05:00Is there anything in particular that would impact your bank the most that you're watching for as gas as the leaders gather in Beijing right now behind closed doors?
05:08They're coming up with the next five year plan, the fifth 15th five year plan.
05:12What would be the most important development coming from that that would help multinational companies like you to grow their presence on the mainland?
05:22That would be in line with what they have pledged, and that is more opening.
05:27Okay. First of all, I think further opening up the financial market is very important for a financial institution like us.
05:34We would like to have more capital flows in and out, right?
05:40We would like to have more QD quotas so that we can help the client to invest in overseas.
05:44Of course, we already get some license that because of opening up, because, for example, we set up a security company's majority owned by DBS group back to three years ago.
05:54So we can do the IPOs and all the equity related business in China.
05:59But, of course, we would like to have more opening up.
06:03So, for example, give more license to international banks so that you can do more business here in China.
06:09Well, that kind of dovetails nicely to the next question, and that is there was about 18 different deals signed, I believe, in the last week or so between Singapore and China.
06:17Some big, some tiny. One was DBS and Guotai Hightong Securities.
06:22That's right.
06:22But no detail. So what is that? You talked about you'd like to see more of a brokerage presence here.
06:27That is a brokerage. What would this entail?
06:30Yeah. In fact, the strategic collaboration between DBS and Guotai Hightong is to leverage on each other's strength.
06:37And I would say that mainly for DBS and Guotai Hightong to work together to support the Chinese corporate going global.
06:45Right. This is, as I mentioned, that this is a very, very big trend that I think will support the economic growth of China.
06:52And nowadays, I see not only the industry leaders, but their so-called whole supply chain is moving out to overseas, mainly to ASEAN, also go to Middle East, Africa and even Latin America.
07:06So for the financial institutions like in China, they typically lack of network and expertise in overseas.
07:13So that will create a collaboration between DBS and Chinese financial institutions.
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