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Awards

Asiamoney Private Banking Awards 2020: Thailand

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Thailand

Best Domestic Private Bank: Phatra Wealth Management

Best International Private Bank: Credit Suisse

Best for Asset Management: Phatra Wealth Management

Best for Investment Research: Siam Commercial Bank

Best for ESG: Kasikornbank

Best for HNW: Phatra Wealth Management


Award winners

Best Domestic Private Bank: Phatra Wealth Management

Best for HNW: Phatra Wealth Management

Best for Asset Management: Phatra Wealth Management

Narit-Kosalathip-Phatra-Securities-160x186
 Narit Kosalathip, Phatra Wealth Management

Phatra Securities was spun out of Merrill Lynch and Kasikornbank in 2003, and then taken over in a management buyout by a group of local executives who saw a bright future for their domestic market.

It has since become one of the most impressive, entrepreneurial brokers in the country. It should be little surprise that its wealth management arm is also punching above its weight.

Phatra had a great 2019, generating net new money of Bt98.2 billion ($3.1 billion), about 66% more than in the previous year. It added 1,774 clients, increasing its overall client base to 18,631 people. Its revenues grew Bt1.25 billion, up about 9.45% on the previous year.

Narit Kosalathip, head of wealth management, has overseen growth in headcount. The bank added nine relationship managers last year, bringing the team to 72. Phatra also roughly tripled its investment specialist team to 22, giving it a greater ability to create bespoke investment solutions for clients.

Phatra’s main pitch to its clients is its uniqueness. It is the only large private bank in the country that has grown out of a securities house, meaning it can beat the competition in trading, product choice and investment advice.

Its rivals have all been created from commercial banks, where lending is likely to be easier but giving access to a range of different asset classes faces greater hurdles.

Case in point: Phatra is unique among Thai private banks in offering its clients the ability to buy private debt.

Phatra Wealth Management is increasingly using events to educate its clients and help them network – or at least it was until the coronavirus pandemic spread around the world.

It hosted an event at the start of the year that featured talks from investors such as BlackRock, JPMorgan, SCB Asset Management and Oaktree Asset Management. The theme of the event was ‘forging resilience’, certainly an apt choice given how the year has gone.

Phatra’s high net-worth clients represented assets under management of Bt561.1 billion ($17.8 billion) in February, a rise of 12.2% over the previous year. Those short-term numbers are eye-catching, but they are the result of a long-term investment in the market.

Phatra executives say that building a private banking business is a marathon, not a sprint. They seem able to do both.

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Best for Investment Research: Siam Commercial Bank

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 Metinee Jongsaliswang, Siam Commercial Bank

How should investment research be compared between different private banks? The obvious ways are to look at the performance of each firm’s top picks, to compare their thematic reports, or to consider the range of asset classes they cover. This is an understanding of investment research that has not changed since the fax machine was the latest in technology.

There is another way to consider the question. Which firms have made the best use of technology to innovate the entire process of investment research? How has that changed the way they offer research to clients? Siam Commercial Bank’s investment research thrives under this sort of scrutiny.

Under Metinee Jongsaliswang, head of private banking, it has used technology to expand its research offering while still ensuring it is tailored to each client.

SCB has used artificial intelligence to create its ‘easy invest robo-adviser’, a service on SCB’s mobile app that allows customers to define their goals, including their risk appetite, before suggesting a portfolio of investments.

The use of AI means SCB can offer bespoke investment advice even to its smallest clients. That supplements its team of investment consultants, who give old-fashioned – but still important – investment advice to key clients.

SCB has added some meat to its product offering. In the first quarter of 2020, it introduced private equity, knock-in knock-out options, bond forwards and Lombard loans.

But it still operates an open architecture model, making it willing to put investment advice before the desire to generate fee income for its own products. That is crucial for a firm that is putting advice at the heart of its pitch to clients.

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Best for ESG: Kasikornbank

The dirty secret of environmental, social and governance factors in Asia is that few banks really care about it.

Most banks pay lip service to the market. All of them will change their behaviour if their clients do so first. But few will put the work in to convince their clients to start thinking more deeply about ESG.

Kasikornbank is a notable exception. The bank has put sustainability at the heart of its strategy for 2020, combining a sense of obligation and a recognition of opportunities in the market.

The strategy applies across the wider bank, but it is the private banking side that can perhaps drive the most crucial change.

The bank has spent the last few years pushing the concept of ‘perfect wealth’ to its clients. The emphasis is on combining wealth with a sense of happiness, achieved through charitable works and investments in sustainable businesses.

That reflects the advice its gives to its clients. The shock of the Covid-19 pandemic has led to a flurry of calls between worried clients and their private bankers across Asia, and indeed across the world: where should they put their money when the chaos of Covid subsides? Kasikornbank’s relationship managers have a clear answer: the future is in impact investing.

In 2019, the bank launched its first impact fund, K-Change.

The bank has partnered with Switzerland’s Lombard Odier to improve its product offering, allowing it to offer its clients a full range of global investment opportunities. That immediately unlocks the European green bond market, still the biggest market for sustainability focused investors in the world.

This focus is all the more important because of the bank’s size. It has assets under management of about $20 billion, roughly 70% of which is held in investments. That is a big change from seven years ago, when roughly 70% of its assets where held as deposits.

By convincing its clients to take more active investments – and ensuring many of those investments have a positive social or environment impact – Kasikorn has positioned itself as Thailand’s go-to private bank for ESG.

That will be especially important as wealth is transferred to members of the next generation, who increasingly see doing good and doing well as a non-binary choice.

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Best International Private Bank: Credit Suisse

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 Marcus Sloor, Credit Suisse

Credit Suisse has been covering clients in Thailand since 1996, but in 2016 it went a step further and established a presence in the onshore wealth management market. It has performed impressively since then. The firm’s assets under management in Thailand rose by double digits in percentage terms for three years in a row.

Its net new assets were particularly large in 2019, up about 105% from the previous year. A big part of that was in the form of assets Credit Suisse’s clients had moved back from the offshore market, a good example of a foreign private bank contributing to the growth of the local market.

Marcus Sloor, market group head for Thailand and Vietnam, has overseen a neat application of Credit Suisse’s global raison d’etre, bringing together private bankers and investments to add value to both businesses.

This includes the bank’s work on a recent, large domestic IPO. The private banking team helped drive orders for this deal and helped shareholders in the company manage the cash they raised, according to a source familiar with the deal.

The team covering the country is split between Singapore and Thailand, but more than two thirds of the relationship managers are Thai. By two key productivity measures, they have had a good year. Assets under management per RM were up 14% in 2019, while revenue per RM was 13% higher.

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