00:00So, Hong Kong's back, right? Tell us some of the anecdotal numbers that you've seen with family offices, global wealth
00:07managers coming back to the city.
00:08Now they're the number one, surpassing, I mean, the domiciled home of UBS in Switzerland, but Hong Kong surpassed it
00:16last year.
00:17Yeah, first of all, thank you so much, Stephen, for coming here.
00:22Indeed, it's a very strong momentum. If you look at our AIC, it's at full swing in Hong Kong.
00:30How many delegates here?
00:314,500 participants from 38 countries and 400 companies joining with a total market cap of, combined market cap of
00:41over $1 trillion, $10 trillion.
00:46So, that's significant. So, you can see the kind of momentum is really coming back here.
00:52What do you think the secret sauce is? We already know, of course, Hong Kong's been a global international hub,
00:57but it's been a rough decade or so, if you will, for Hong Kong.
01:01They've had a number of different regulatory improvements here to attract.
01:04I mean, obviously, the stock market has gone gangbusters with tech IPOs, but can you nail down to what really
01:10is the reason that Hong Kong has surpassed Switzerland to be the number one wealth hub in the world?
01:15I think both Hong Kong and Switzerland are the world's important wealth management hub.
01:20And for Hong Kong, obviously, Hong Kong is a capital market hub.
01:24As you said, the IPO, the capital market activity certainly is very helpful, and we still have 500 companies lining
01:32up.
01:33And I think in the last few years, what the government has been doing, and also with all these different
01:39support schemes, also create a very good environment for the setup of the family offices.
01:45I think in addition to wealth management, as the chair of the Hong Kong Private Boat Management Association, we have
01:54also seen over 50% of our associate membership growth, meaning a lot of the asset managers are also coming
02:04in.
02:04So you have also seen a lot of the asset managers, James G, Millennium, Pond 72, they are also expanding
02:12their offices here.
02:13And so I think it's both the asset and wealth and also the capital market activity that creates the kind
02:23of momentum.
02:24Well, the single-family offices in Hong Kong have grown 25% since 2023, now 3,384 of them.
02:31How have you seen the chessboard with geopolitics, war in the Middle East, how is that changing and sort of
02:38leaning towards Hong Kong?
02:39Have you seen more Middle Eastern money move to places like Hong Kong and Singapore?
02:45Hong Kong is a super connector, and UBS obviously is also a super connector.
02:49And being a super connector, it's also very important to be value-added super connector for China, because a lot
02:56of them also want to look at the opportunities in China.
03:01So, for example, like this forum, we created the wealth forum whereby we have a delegate from Middle East, we
03:09have a delegate from Latin America, and also a delegate from Europe coming here with almost 1,000 participants.
03:18And we have, in addition, a global family office summit in the AIC, and you can see the interest from
03:28different parts of the world coming here.
03:31Because I think if you look at the investment environment, I would say it has improved, especially compared to last
03:38year.
03:39But the regulatory environment has also tightened.
03:41You knew I was going to talk about this.
03:43Momentum, how is it affecting wealth momentum into Hong Kong?
03:46Because, again, there's been a more recent crackdown, I think they announced it on Friday, on illegal brokerages and funneling
03:52money.
03:52And China's really worried, always worried about capital outflows.
03:55And, of course, the IPOs have been booming, as we talked about.
03:58How is that impacting how you attract your wealth clients and onboarding new clients?
04:04Now, fundamentally, if you look at all those regulatory changes, they primarily, mainly target on the licensed and regulated activity.
04:14And for UBS and also for all the members' bank within the Private Wealth Management Association, we are operating under
04:23a robust, compliant kind of framework.
04:26As a matter of fact, the industry also welcome all this regulatory change so that you can direct the investor
04:32into a compliant, regulatory kind of official channel, be it Stock Connect, QDII, or Wealth Connect.
04:44Now, Iqbal Khan, you know, the Asia-Pacific head here, he said absolutely onboarding of new clients has slowed down
04:50across the industry.
04:52It seems like Hong Kong, though, seems to be a bit of an aberration, but Hong Kong banks are, in
04:57the reporting in Bloomberg today, are ramping up, you know, scrutiny, if you will, of mainland Chinese clients' opening of
05:04savings and investment accounts.
05:06How is that impacting you?
05:08Oh, I think the industry also realized we need to also have a kind of efficient but compliance kind of
05:16framework for onboarding clients.
05:18So it's how we also strike a good balance there.
05:22And not cutting the corner has to be compliant.
05:25And I think that's where the AI and technology can help because, for example, at UBS, we also invest large
05:33scale on AI transformational, not just on the front, but also on onboarding.
05:38And having the AI agent to help us to do all the KYC AML.
05:44Well, Iqbal mentioned that yesterday, but he didn't go into details.
05:48How are you employing that to, you know, deeper scrutinize the source of wealth of these clients, which I think
05:56is a big issue?
05:56Oh, as I said, it's leveraging on all these AI agents in order to do, to help with the KYC,
06:04with the AML.
06:05And so that we can also give more capacity for our CA, for our kind of advisor, the bankers, to
06:13do, to deliver a better kind of experience.
06:16And when all these documents and the process come in, we can also streamline.
06:22So I am seeing much improvement.
06:25And on a regular basis, as the chair for the Hong Kong Private Work Management Association, we still have the
06:31dialogue with the regulators to how are we going to further streamline the process to make it efficient but compliant.
06:40Now, I have to squeeze in one last really quick one because we're running out of time.
06:44But obviously, in February, you said you're going to be hiring about 50 wealth managers in Hong Kong.
06:49Do you need to also now start – where are you on that process?
06:51And are you going to start hiring AI experts as well?
06:54We are on track.
06:56And while, obviously, we are investing in AI, but at the same time, this is the growth region.
07:02So we continue to hire.
07:04And when we hire, it's not just in Hong Kong and actually in Asia Pacific because Asia Pacific is also
07:12an important growth region for UBS.
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