Earlier this week we reported on Barclays’ plans to increase headcount by 15% to 20% in its wealth and investment management division in the Middle East and North Africa. Now Barclays has announced a similar wealth management expansion in Asia, as it aims to double the division’s revenue in the region by 2019.
The firm is boosting its Asian wealth sales team by 25% over the next 12 to 18 months, Didier von Daeniken, head of wealth management for Asia-Pacific, Middle East and Africa, told Singapore’s Business Times. He did not provide current regional headcount numbers, but did say that Barclays employs about 100 private bankers in Singapore and Hong Kong alone. Some of the hiring surge will be in Japan, however, where Barclays is growing its private banking business through a joint venture with Sumitomo Mitsui Banking Corporation.
As we’ve noted throughout this year, hiring new private bankers in Asia is no easy task because of the widespread reluctance of their clients to transfer to a new platform. “But most of those [new hires] aren’t capable of moving the assets over, as they underestimate the stickiness of a client relationship with an established institution,” Bassam Salem, chief executive of Citi’s private bank in Asia-Pacific, told the FT earlier this week. Meanwhile, private bankers who are recruited face increasingly onerous first-year revenue targets.
Barclays’ von Daeniken recognises the challenges ahead, telling the Business Times that it would be "unrealistic" for the wealth unit in Asia to continue to grow at the current 30% rate on a compound annual-growth basis. "I like the fact that the environment is becoming more demanding," he said, adding that the bank is comfortable with its costs relative to its income. "Some of our competitors are just too small."
Barclays, which is currently cutting 7,000 jobs globally from its investment bank, is not the only firm to shout about its Asian growth prospects in private banking. Morgan Stanley announced (very) similar plans last week: it expects to boost its current 100-strong headcount of private bankers in Asia by 15% to 20% over the next 12 to 18 months. In recent weeks the Asian bosses of Deutsche Bank’s and BNY Mellon’s wealth management units have also talked up their growth plans.