Swiss private bank UBS has become the first wealth manager in the region to grow its assets under management beyond 300 billion Swiss francs (S$425 billion), with plenty of room to expand further, its head said yesterday.
Profit before tax in the Asia-Pacific wealth-management division grew over 30 per cent from the same period a year earlier to 263 million francs in the first quarter.
Assets under management rose 16.9 per cent year on year to 311 billion francs.
"As the results show, Asia remains an area of growth for UBS. We plan to consolidate our growth in the region by sharpening our focus on China, Japan and Taiwan, as well as the regional wealth-management hubs, Hong Kong and Singapore," said Mr Edmund Koh, the head of UBS Wealth Management, Asia-Pacific.
Over the last year, UBS has opened a branch in Shanghai and another in Kowloon - its first branch in Hong Kong outside the central business district.
UBS had reported better-than-expected first-quarter numbers two weeks ago. Across the group, profit before tax soared 42 per cent to 1.93 billion francs, driven by its investment-banking and wealth-management businesses and ongoing cost reductions.
The Asian wealth-management business has been an especially stellar performer within the overall business, now contributing to 36 per cent of group profit, up from just 10 per cent in 2012, noted Mr Koh.
Enhanced regulatory requirements have hit smaller private banks hard, triggering consolidation in the sector, which has benefited UBS, he said.
"Customers would go for the more established wealth managers, and those consistently voted the best, so they are comfortable to consolidate their wallet with us," he told The Straits Times.
"And our performance has validated their choice - more than 90 per cent of our customers generated very positive returns, guided by our chief investment officer's views."
This trend is likely to continue, Mr Koh added, as regulators are introducing more rules on private banks and their clients, requiring them to file more disclosures, as part of global efforts to raise transparency and combat tax avoidance and money laundering.
"It can be too much for customers to deal with more than one bank, so we already see more starting to opt for consolidation with us," he said.
The bank is also attracting more client advisers, he said, who are drawn to its significant investments in state-of-the-art technology and its healthy balance sheet.
"Our competitors typically have 20 per cent of their AUM (assets under management) in loans, but our loans make up only 12 per cent of AUM, so we have a substantial balance sheet to grow."
