One-size-fits-all wealth management does not "fit" in Asia-Pacific
HONG KONG, SINGAPORE, Sept. 25, 2013 /CNW/ - Almost half (45.4 percent) of the world's high net worth wealth growth has come from Asia-Pacific over the past five years (2007-2012), a trend that is expected to continue, according to the Asia-Pacific Wealth Report 2013 (APWR), released today by Capgemini and RBC Wealth Management. This distinction provides wealth management firms with opportunities for growth, but requires tailored and scalable offerings to meet the diverse needs of high net worth individuals (HNWIs) across the region.
"With consistent wealth growth across Asia-Pacific markets, the region is poised to have the largest high net worth population by as early as 2014," said M. George Lewis, Group Head, RBC Wealth Management & RBC Insurance. "This growth provides both opportunities and challenges for firms, who will need to cater their offerings to meet the diverse needs of clients in the region to remain competitive in a rapidly-evolving and increasingly complex industry."
Key differences between Asia-Pacific HNWIs and HNWIs in other regions
Results from the inaugural Global HNW Insights Survey1 incorporated into this year's APWR revealed that while Asia-Pacific HNWIs share some traits with HNWIs in the rest of the world2, they also hold a number of unique characteristics pertaining to the management of their wealth.
The unique traits of Asia-Pacific (excluding Japan)3 HNWIs include:
- Higher trust and confidence in firms and wealth managers. Over three-quarters have high levels of trust in wealth management firms (78.8 percent) and wealth managers (77.9 percent) compared to two-thirds (66.8 percent and 65.9 percent) of HNWIs in the rest of the world. Japanese HNWIs, by contrast, had low levels of trust, with only about 30 percent having confidence in various segments of the industry.
- More complex wealth management needs. They perceive their wealth management needs to be complex, encompassing business, family or philanthropy, with 41.1 percent holding this view, compared to 21.2 percent in the rest of the world. With regards to advice on family wealth, 42.3 percent of Asia-Pacific HNWIs have this need while 23.3 percent require personal wealth advice.
- Preference to work with multiple experts at one firm. They prefer to work with multiple experts (40.1 percent) at one firm, in contrast with those in other regions who prefer one point of contact (40.4 percent versus 21.7 percent who prefer multiple experts).
- Preference for digital versus direct contact. Nearly 40 (38.2) percent rated digital as more important than direct wealth manager contact compared to 21.5 percent of HNWIs in the rest of the world.
- Willingness to pay for customized services. Asia-Pacific HNWIs say they are willing to pay more for services that go beyond standard wealth offerings (42.3 percent compared to 25.5 percent in the rest of the world).
Preferences and behaviors differ by country
While there were different perspectives and behaviors expressed by Asia-Pacific HNWIs compared to those in the rest of the world, the region cannot be viewed as uniform, with varying views held by HNWIs across individual Asian markets as well. These differences are most clear when comparing HNWIs in Japan with those in China and India.
While HNWIs in Japan expressed no strong preferences in terms of their wealth management servicing needs, HNWIs in China and India expressed clear opinions, with both countries having the highest proportion of HNWIs who view their needs as complex and desire input from a number of experts.
"Firms that try to develop a 'one-size-fits-all' servicing model to address the general needs of Asia-Pacific HNWIs will fall short," said Jean Lassignardie, Chief Sales and Marketing Officer, Capgemini Global Financial Services. "The firms with the ability to combine deep local HNWI knowledge with a tailored and scalable value proposition, upgraded business models and seamless client experiences will be best positioned to capture growth."
What do wealth management firms need to be successful?
To best position themselves in the Asia-Pacific HNWI market, the report highlights several specific areas for firms to focus on ranging from ensuring an understanding of individual country HNWI preferences, investing in digital communications, and building capabilities in specific wealth management services to meet the needs of business owners such as estate and succession planning.
The Asia-Pacific Wealth Report 2013
Expanding on the findings of the World Wealth Report, the Asia-Pacific Wealth Report from Capgemini and RBC Wealth Management provides population and wealth data for ten core markets in Asia-Pacific. Spanning Australia, China, Hong Kong, India, Indonesia, Thailand, Japan, Singapore, South Korea and Taiwan, the report reviews economic and market performance drivers, as well as High Net Worth Individual (HNWI) investing behaviors in the Asia-Pacific region. This year's report also includes a section that provides an in-depth focus on HNWI perspectives and behavior based on a global survey of over 4,400 HNWIs, including almost 1,400 respondents from Asia-Pacific. Through the survey findings we explore HNWI confidence levels, asset allocation decisions, as well as their wealth management advice and service preferences. Download the report at www.asiapacificwealthreport.com.
With more than 128,000 people in 44 countries, Capgemini is one of the world's foremost providers of consulting, technology and outsourcing services. The Group reported 2012 global revenues of EUR 10.3 billion. Together with its clients, Capgemini creates and delivers business and technology solutions that fit their needs and drive the results they want. A deeply multicultural organization, Capgemini has developed its own way of working, the Collaborative Business ExperienceTM, and draws on Rightshore®, its worldwide delivery model. Learn more about us at www.capgemini.com.
Rightshore® is a trademark belonging to Capgemini
About Capgemini's Financial Services Global Business Unit
Capgemini's Global Financial Services Business Unit brings deep industry experience, innovative service offerings and next generation global delivery to serve the financial services industry. With a network of 24,000 professionals serving over 900 clients worldwide Capgemini collaborates with leading banks, insurers and capital market companies to deliver business and IT solutions and thought leadership which create tangible value. More information is available at: www.capgemini.com/financialservices
About RBC Wealth Management
RBC Wealth Management is one of the world's top 10 largest wealth managers*. RBC Wealth Management directly serves affluent, high-net-worth and ultra-high net worth clients in Canada, the United States, Latin America, Europe, the Middle East, Africa, and Asia with a full suite of banking, investment, trust and other wealth management solutions. The business also provides asset management products and services directly and through RBC and third party distributors to institutional and individual clients, through its RBC Global Asset Management business (which includes BlueBay Asset Management). RBC Wealth Management has more than C$615 billion of assets under administration, more than C$373 billion of assets under management and over 4,400 financial consultants, advisors, private bankers, and trust officers. For more information, please visit www.rbcwealthmanagement.com.
Royal Bank of Canada (RY on TSX and NYSE) and its subsidiaries operate under the master brand name RBC. We are Canada's largest bank as measured by assets and market capitalization, and are among the largest banks in the world, based on market capitalization. We are one of North America's leading diversified financial services companies, and provide personal and commercial banking, wealth management services, insurance, investor services and wholesale banking on a global basis. We employ approximately 80,000 full- and part-time employees who serve more than 15 million personal, business, public sector and institutional clients through offices in Canada, the U.S. and 44 other countries. For more information, please visit rbc.com.
*Scorpio Partnership Global Private Banking KPI Benchmark 2013. This measurement includes all global RBC Wealth Management affiliates including the U.S. division. In the United States, securities are offered through RBC Wealth Management, a division of RBC Capital Markets, LLC, a wholly owned subsidiary of Royal Bank of Canada. Member NYSE/FINRA/SIPC.
1 Capgemini, RBC Wealth Management, and Scorpio Partnership Global HNW Insights Survey 2013.
2 "Asia-Pacific" refers to those markets compared in the APWR section on regional diversity: Australia, China, India, Japan, Hong Kong, and Singapore. The term 'rest of the world' refers to the 15 countries covered in the Global HNW Insights Survey 2013 except those in Asia-Pacific: Belgium, Brazil, Canada, France, Germany, Italy, Mexico, Netherlands, Russia, South Africa, Spain, Switzerland, UAE, UK, and US.
3 As Japanese HNWIs have markedly unique investing behaviors and preferences and the country accounts for more than 50 percent of the region's HNWI population, we frequently isolate and make reference to Asia-Pacific excluding Japan when performing regional analysis. However, complete findings on Japan as a country are covered extensively in the Asia Pacific Wealth Report.
For further information:
Courtney Finn (North America)
Weber Shandwick for Capgemini
+1 952 346 6206
Marta Saez (EMEA)
Weber Shandwick for Capgemini
+44 (0) 20 7067 0524
RBC Wealth Management Contacts:
Aishling Cullen (North America)
+1 416 974 4826
Peter Hoflich (Emerging Markets)
+65 6230 1530