The move will see between 10-20% more people in the private banking team, which already consists of 200 private bankers, Lawrence Lau, deputy private banking head, told Bloomberg.
Hiring will be spread across the three main teams covering southeast Asia, north Asia and international markets plus Indians living abroad.
“Our clients, the wealthy, have grown their businesses. They have cash flow, more liquidity,” Lua said. “The market has been kind” and DBS is beefing up its headcount to capture more of this wealth, he said.
Growing regional prosperity
Asia Pacific wealth managers have benefited from the region’s growing prosperity, with wealth rising faster than North America and Europe. Assets owned by rich Asians rose 8% in 2016 to $18.8trn (£13.3trn, €15.2trn), led by southeast Asia and Greater China, according to a report from Capgemini.
It is forecast an increase to about $40trn by 2025.
In the first nine months of 2017, DBS’s AUM jumped 23% to S$195bn ($148bn) compared with the same period a year earlier. This includes S$15bn from the acquisition of ANZ’s wealth management and retail banking businesses in five Asian markets.
Shift from commissions
Private banks in Asia tend to use a commission-based model, where they charge clients based on the volume of their transactions. That’s a contrast to Europe, where the banks usually charge fixed fees for managing or advising clients on their portfolios.
The Singapore government last year asked companies operating in the country to shift away from product sales and adopt an advisory approach. DBS is trying to do so but first needs its clients to buy into the change, Lua told Bloomberg, adding that he believes the shift will be good for clients.
“Asians tend to be more transactional in nature,” Lua said. “In the longer run, if they believe in the relationship, and they believe that there is a value proposition in the service provider, they will pay a fee.”