Julius Baer’s Thai joint venture targets 1trn slice of wealth management business
A joint venture between Siam Commercial Bank (SCB) and Swiss firm Julius Baer Securities is targeting a large slice of the wealth management business for high net worth individuals.
Wealth management for individuals worth over Bt100 million is a market worth Bt10 trillion and growing at 9.9 per cent per year.
The joint company – SCB-Julius Baer Securities – is targeting a market share of Bt1 trillion or 10 per cent in the next five years.
At 1 trillion, SCB-Julius Baer would become one of Asia’s top 20 private banks by assets under management, based on Asian Private Banker's 2019 league table.
Lalitphat Toranavikrai, CEO of SCB-Julius Baer Securities (SCBJB), said the number of high net worth individuals is likely to increase, adding that they also topped up investment continuously.
"The reason high net worth individuals invest in our securities company is because we can manage their investment portfolios professionally and are able to generate returns of at least 10 per cent per year," she said.
"We were able to maintain growth in this market because we are a world-class investment expert who understands how to manage risks."
She said SCBJB invested 100 per cent in overseas – 51 per cent in foreign equities, 40 per cent in foreign debt instruments, 5 per cent in foreign currency exchange markets, and 4 per cent in other foreign assets.
"Though we face the Covid-19 crisis, we believe that high net worth individuals will not stop their investment, so we expect [our] assets under management to hit Bt20 billion this year," she said.
She said investors still face various challenges this year, especially from the Covid-19 fallout causing volatility in markets during the past two quarters.
"However, we witnessed signs of economic recovery in the third quarter of this year, while global gross domestic product next year is expected to grow by 6.5 per cent from this year, which is expected to contract by 3 per cent," she said.
"Therefore, we expect the equity market to be more interesting than the safe-haven asset market, while we will focus on investment in the US and China."
SCB-Julius Baer is also appointing more staff.
"To support the securities company's growth and generate the best returns in the future, we will increase the number of relationship managers to 30 positions by the end of this year.
She added that SCBJB recently opened its first Thailand office, located on Sukhumvit Road.
