Rise of rich to boost OCBC’s wealth management business

SINGAPORE – OCBC has managed to grow its wealth management business by double-digit percentage rates despite the headwinds facing the global economy, as it banks on its ability to offer a wide range of products to meet diverse needs, distribute products through multiple channels, and understand and cater to different needs of each customer segment.

OCBC’s wealth management income is projected to rise to S$2.55 billion this year, up from S$2.22 billion last year and almost double the S$1.32 billion in 2010, the bank said today (TUES). The segment is expected to account for 29.5 per cent of group income this year, up from 27.9 per cent last year and 24.7 per cent in 2010.

As a group, assets under management rose to S$195 billion as of end-June this year, up from S$175 billion last year and S$112.7 billion in 2010. The group AUM includes OCBC Bank, its private banking arm Bank of Singapore and its asset manager Lion Global Investors.

OCBC’s wealth business is only likely to grow, with the number of millionaires around the world forecast to grow by 46 per cent to 49.3 million over the next five years, a Credit Suisse report showed today (TUES).

In Singapore alone, the number of USD millionaires in Singapore is projected to rise by 50 per cent over the next five years to reach 212,000 in 2020, the report showed. There are an estimated 752 ultra-high-net-worth individuals in Singapore with more than USD 50 million net wealth.

To tap on these individuals, OCBC said: “In 2011, when we rolled out our consumer bank strategy, we stopped focusing on what products to sell, and shifted our focus onto the customers and understanding their needs. Through the use of big data and analytics, which we have built the infrastructure for over 10 years, it has helped us to look study intimately the needs of our demographics, then knowing the type of products they need, and how to distribute to them.”

The bank prides itself on creating synergy across all its operating entities to eliminate complexities.

For example, a private banking client of Bank of Singapore, who needs help on any banking matters, can go into any OCBC branch in the region and receive service, OCBC said.