Asiamoney Private Banking Awards 2020: Malaysia
Best Domestic Private Bank: CIMB Private
Best for Investment Research: CIMB Private
Best for Wealth Transfer/Succession Planning: CIMB Private Banking
|Shahnaz Jammal, CIMB Private Banking|
CIMB Private Banking is the biggest and best private bank in Malaysia. Its $11.5 billion in assets under management in the domestic market at the end of 2019 was equivalent to what Maybank, a close rival, boasts globally. And despite being the incumbent, it is also achieving impressive growth.
The firm’s domestic AuM increased 21% in 2019, while its revenues rose 9%. The boost in revenues largely came from a rise in fees from loans and trading, reflecting the success of the bank’s attempt to drive more fee income.
CIMB has about 80 relationship managers in Malaysia, but they are supported by 16 investment specialists, a key plank in the firm’s strategy to offer best-in-class investment advice to its clients. These investment consultants are an important driver of clients with $5 million or more assets at the firm, allowing CIMB to give these clients customised investment advice that considers risk tolerance, particularly their hunger for leverage.
The bank has also made a push for millennials. CIMB’s AuM from millennials grew 124% in 2019, partly because they have been able to connect the dots between private, corporate and investment banking.
This is particularly important for the younger generation, who are still hungry for deals and, in some cases, are likely itching to take over businesses from patriarchs and matriarchs.
The ability to leverage the strength of the corporate and investment bank is, in fact, part of the wider strategy at CIMB Private Banking. Under chief executive of group wholesale banking, Shahnaz Jammal, the bank has developed relationships with most large corporations in Malaysia, ensuring that the very biggest clients are well covered.
But the corporate and commercial banking units have also put more emphasis over the last few years on small and medium-sized enterprises, creating another source of growth for their private banking colleagues.
CIMB’s wealth transfer business is unparalleled in Malaysia. The firm’s ability to structure trusts is not just limited to its biggest clients: its ‘trust wrapper’ allows easy access to a trust for both assets and insurance policies for clients who are either not ready or not willing to go through the work needed to create a bespoke trust structure.
Malaysian banks face more hurdles than others when creating trusts, since shariah law places extra restrictions on how such entities are structured. But ties with CIMB Islamic mean that CIMB Private Bank has little problem offering the full range of services to its Muslim clients.
Perhaps the best indication of the bank’s dominance comes from a rival, during a meeting to pitch his own bank’s credentials: “CIMB is the clear leader at the moment,” he tells Asiamoney. There’s no better recommendation than that.
Best for HNW: Maybank
Maybank secured a coup in the middle of 2019 when it hired Carolyn Leng as its new head of private, wealth management.
|Carolyn Leng, Maybank|
Leng, who had run CIMB’s private banking arm for nine years, immediately got to work shaking things up at the bank.
It was a bold step for a bank that is still dwarfed by its local rival. Maybank has about $14 billion of assets under management, roughly half of CIMB’s global AuM, according to sources at Maybank, but Leng has plans to bridge the gap.
Leng has made “huge adjustments” to Maybank, according to a banker at the firm.
She has put an emphasis on building the firm’s credit platform, developing a key part of the offering of any ambitious private bank; rolled out plans to double headcount over the next 12 to 18 months; and encouraged a move to win more ultra-high net-worth clients, moving Maybank away from a historical focus on smaller, retail clients.
Maybank’s minimum asset size for new accounts is RM4 million ($933,112) but it is increasingly aiming for a richer client base. Its strategy for appealing to HNW individuals emphasizes investment advice, discretionary portfolio management and credit.
This is hardly novel but private banks do not need to reinvent the wheel, they only need to make the journey smoother.
Maybank will not supplant CIMB any time soon. HNW individuals tend to have relationships with multiple banks, and Maybank will always have to share the limelight with CIMB and AmBank. But Maybank’s rapid growth plans means it may soon be competing for the top spot.
Best International Private Bank: Credit Suisse
|Young Jin Yee, Credit Suisse|
Credit Suisse’s strategy in Malaysia reflects its broad approach elsewhere: marrying private banking with investment banking to create a one-stop shop for clients.
The private banking team is overseen in the country by Young Jin Yee, market group head for Singapore and Malaysia. She has steered the focus to the next generation, ensuring the bank will remain a force to be reckoned with in the years to come. But that does not appear to have come at the expense of the wealthiest clients today: Credit Suisse banks more than 50% of those on country’s Forbes 50 rich list.
The firm’s wins in Malaysia last year included its mandate on the $265.6 million IPO of Leong Hup International, a poultry producer. The deal offers a good example of collaboration in action. Credit Suisse relationship managers worked alongside their investment banking colleagues for 20 months to bring the deal to fruition, but their hard work was worth it. Not only did the investment bank win an important source of revenue but the private bank generated net new assets as a result of the deal.
The Swiss bank puts a lot of emphasis on winning business from Malaysian entrepreneurs, but its own bankers can be just as entrepreneurial.