UBS, HSBC hire aggressively in $10 trillion Taiwan wealth market

Global banks are racing to secure a piece of Taiwan’s rapidly growing US$8 trillion (S$10.36 trillion) wealth market as the government eases money-management regulations to capitalise on booming personal fortunes.

Lenders including UBS Group, HSBC Holdings and BNP Paribas are hiring aggressively to beef up their presence in a newly created wealth management zone launched in July in Taiwan’s gritty port city of Kaohsiung. 

UBS plans to grow its client-facing staff in Taiwan by between 10 per cent and 15 per cent in 2026, and expand mid- and back-office operations in Kaohsiung to manage fund flows. Standard Chartered has tripled its Taiwan-based wealth specialists over the past three years and will hire more in the coming months. HSBC aims to further scale its local wealth team following a recent expansion to support its pilot operations in Kaohsiung and BNP Paribas wants to add about 15 relationship managers across the island over the next two years.

The new zone’s more permissive rules are designed to help banks tap into Taiwan’s fast-growing pool of homegrown affluence, driven by a global surge in demand for semiconductors that underpin the rise of artificial intelligence (AI). The goal is to overcome several disadvantages Taiwan has as a place to store wealth, such as higher taxes, strict foreign-exchange controls and the ever-lingering threat of a Chinese invasion. 

Combined, those push factors have driven an estimated 40 per cent of Taiwan’s personal wealth offshore to financial hubs such as Hong Kong and Singapore. 

“There is a significant amount of wealth creation as local tech companies take advantage of the artificial intelligence uptrend, as well as Taiwanese who have invested in the stock market over the past couple of years,” said Mr Henry Su, the Taiwan head of UBS. “The Kaohsiung zone is the first step regulators are taking and I think there’s going to be continuing relaxation coming down the pipeline.” 

The Swiss bank’s Taiwan unit has doubled its assets under management in the past two years. “Many global banks are coming after this market hard right now and it signifies one thing: the wealth market in Taiwan is something of a prize that all major players would like to strive for,” Mr Su said. 

Taiwan’s average wealth has risen 35 per cent in recent years, the third-fastest globally, according to a UBS report. It now has more millionaires than Hong Kong and nearly twice as many as Singapore.

Wealth revenue from Taiwan at a US-based investment bank is expected to climb another 30 per cent, outpacing the division’s broader Asia growth of 20 per cent, according to a senior executive, who asked not to be identified because the information is confidential. The bank plans to add 10 Taiwan-focused relationship managers in the next 12 months, and double its presence in three years to 50, the person said.

The domestic wealth boom is closely linked to its tech sector, as high demand for chips and electronic components produced by Taiwanese companies makes the island one of the world’s top-performing economies despite the ongoing wrangling between the US and China over trade. 

Mr Vincent Chui, head of Asia-Pacific wealth management at Morgan Stanley, said: “Taiwan’s AI ecosystem is powering a new wave of wealth creation, benefiting both tech veterans as well as a younger generation of tech entrepreneurs and investors. Global banks with strong Taiwan corporate relationships are best positioned to capture this wealth creation boom.”

The optimism has eclipsed geopolitical concerns in recent conversations with ultra-high net worth clients, according to a senior bank executive. None flagged tensions between China and Taiwan as a key risk in the past 12 months, and there is little sense of urgency around potential conflict, the executive said. 

Despite surging personal fortunes, turning a manufacturing-focused economy into a wealth centre is not easy, as many countries across Asia have discovered. China’s plans to make Shanghai into an international financial hub were derailed by Covid-19 and the country’s adherence to its strict capital controls. Malaysia’s US$100 billion Forest City project has become a largely deserted techno-utopian refuge for crypto and tech entrepreneurs. 

And despite a stock market revival in Japan, the nation’s bid to become a leading asset management centre remains clouded by a fragmented financial sector and a population still deeply committed to saving over investing.

Sandbox City 

Taiwan’s wealth project is housed in a designated 9 sq km sandbox zone in Kaohsiung which will pilot private-banking offerings for high net worth clients. 

The more relaxed regulations grant wealthy individuals products and services not available in the rest of Taiwan, such as borrowing against their investment portfolios – or Lombard Lending. Investors also have access to more cash through higher leverage, with loan-to-value ratios reaching up to 80 per cent, higher than elsewhere in Taiwan. 

Banks in the sandbox area accept a more diverse universe of assets as collateral, including insurance policies and mutual funds denominated in foreign currencies, as well as certain offshore assets. In other parts of Taiwan, only Taiwan dollar-denominated assets are permitted as collateral.

The Taiwan government’s unprecedented wave of deregulation has banks “rolling up their sleeves and eager to jump in,” said Mr Robert Fuh, private banking chief at Cathay United Bank, which has invested tens of millions of Taiwan dollars into talent training programmes in 2025 and plans to nearly double that investment in 2026. 

Regulators will assess in a year whether the zone’s exclusive privileges should be extended to other cities.

Defying gravity

Still, the Taiwan government’s goal of keeping more wealth at home faces obstacles that aren’t likely to disappear any time soon. 

Taiwan has operated under the threat of a Chinese invasion for decades and an increasingly assertive Beijing raises the possibility of conflict between the two neighbours, placing a risk premium on local investments for some investors. 

Higher taxes than regional financial hubs like Hong Kong and Singapore, and tighter controls on foreign exchange also present incentives for wealthy individuals to keep their assets offshore. Taiwan has not proposed major changes in the local tax regime to support the wealth hub policy. 

Despite the disadvantages, Mr John Lin, a 48-year-old owner of a Kaohsiung-based cosmetics manufacturer and a wealth client at several banks, is exploring new financial services in the city’s wealth zone following his company’s initial public offering in July. He says the ease of access to money managed in Taiwan outweighs the higher taxes and geopolitical risks.

“I run a cash flow-heavy business so I need to be able to access liquidity flexibly and keeping capital onshore makes this much easier,” he said. “I pay my employees’ salaries in Taiwan dollars and run my factories in Taiwan dollars. Keeping my assets in Taiwan is much more convenient.” BLOOMBERG