Relationship Building
Banks dealing with super-rich clients get to know the family
Banks that deal with super-rich customers aim to build a multi-generational relationship.
'We are mindful that a client represents a family, usually a large one, and often a family business is involved,' said Akbar Shah, head of mega wealth, Asia-Pacific for Citi Private Bank.
For this reason, every year since 2003, the bank has arranged a 'next generation' conference in either Hong Kong or Singapore. The specific aim is to help the offspring of wealthy clients 'unravel the complexities and subtleties of financial planning'.
During the week-long event, senior bank staff explain various asset classes and alternative investments. In doing this, they provide insights into the latest trends in capital markets and corporate finance, and lead discussions on asset allocation, portfolio management and estate planning.
'Skills, such as the finer points of public speaking and business presentations, are also taught,' said Mr Shah, who noted that, to date, there had been about 100 participants from families in Asia, Australia and the Middle East.
He said that in managing any family's wealth, there would inevitably be differences of opinion about investments and transferring assets. However, it was much easier to avoid or overcome these if the younger generation had a clear understanding of wealth management objectives and opportunities.
'They are the ones who will shape the future of business and industry. It is important that we equip them with the financial knowledge and tools, [and] hear from them about their needs and plans.'
A recent report compiled by Barclays Wealth in co-operation with the Economist Intelligence Unit highlighted the importance of proper succession planning for high-net-worth families.
Almost 60 per cent of 790 survey respondents from around the world said one of their key motivations in accumulating wealth was to have enough to leave to the next generation. What concerned them was how their children would handle the inheritance.
Noting this, Didier von Daeniken, chief executive for Barclays Wealth in the Asia-Pacific stressed the need for a clear process to communicate family goals and define priorities. The key was to ensure that members of the next generation fully understood the practicalities of managing money and, where necessary, the responsibilities that came with inheriting a family business. Once they did, deciding on appropriate legal and financial vehicles to transfer wealth was straightforward. 'To do it properly will take a fair amount of discussion,' Mr von Daeniken said.
