JPMorgan Chase & Co. plans to triple private banking assets in Asia, its fastest-growing market, over the next five years after moving one of its top executives to the region.
The unit, which manages money for wealthy clients and employs 400 people in Asia, intends to increase its number of client advisors in the region by 40 percent this year and next, after growing at a similar pace in 2009, Douglas Wurth, chief executive officer for international private banking at New York- based JPMorgan, said in an interview.
JPMorgan aims to generate about half of its non-U.S. business from Asia, up from the current 20 percent, according to Wurth, who moved to Hong Kong in February from New York. Rivals including UBS AG are also expanding in the region, where assets of millionaires grew 31 percent in 2009, according to a June report by Capgemini SA and Bank of America Corp.
“However excited one can be about the opportunities when you’re in New York, that only magnifies ten-fold once you’re here in Hong Kong, Singapore, Beijing, Jakarta,” Wurth said in Singapore yesterday. “You just see up close and personal the dynamic changes taking place.”
JPMorgan’s expansion comes after the number of millionaires in the Asia-Pacific region reached 3 million in 2009, matching those in Europe for the first time, according to the report by Bank of America’s Merrill Lynch unit and Capgemini. The millionaires’ assets rose 31 percent to $9.7 trillion, it said.
Wurth said the private bank will expand its services in Asia to the high net worth segment, or to people with investible assets of more than $10 million, from ultra high net worth people, or those with about $50 million. JPMorgan will also grow in markets like India and China, where it will hire more than half of its new staff, he said. The private bank manages more than $700 billion of assets globally, Wurth said.
“JPMorgan as a bank has a good brand, but expanding to the high net worth segment is going to be a brand new business for them,” said Chris Claridge, managing partner at Consulting Partnership, a Singapore-based recruitment firm. “There are already many established players in the market, and clients will be asking why I would want to move my money again.”
It could also be a “toughish proposition” in the short term to attract talent as the bank grows and modifies its platform to accommodate the expanded clientele, Claridge said.
JPMorgan appointed Peter Flavel, formerly Standard Chartered’s global head of private banking, in July to a newly created role as Asia CEO of private wealth management, focusing on individuals with more than $10 million. A month earlier, it appointed Andrew Cohen as Asia-Pacific CEO of private banking for ultra-high net worth individuals.