Lifelong partner in wealth preservation
Many of Hong Kong’s wealthy families earned their “first bucket of gold” from manufacturing in the 1960s or 1970s when Hong Kong’s economy took off. They continued to accumulate their wealth from their Mainland businesses after the opening up of China’s economy in 1980s. Nowadays, these business owners have to travel between the Mainland and Hong Kong frequently, which has created a growing demand for cross-border private banking services.
Bank of Communications is backing its customised approach to win over Hong Kong's wealthy with its first-class OTO FORTUNE private banking service first launched in 2008. Introduced to the Hong Kong market in 2010 to coincide with the establishment of its state-of-the-art private banking service centre in the city, the bank offers comprehensive, integrated wealth management services to Hong Kong’s high net worth clients—without the limit of boundaries.
“Our private banking clients have successful establishments in Hong Kong and the Mainland. Whether they are entrepreneurs, executives or social elite, their presence is well felt across different sectors. Excelling in their careers on the one hand, they also engage in investment activity on the other hand. Most of them are now in the stage of wealth accumulation or preparing their kids for their inheritance,” says Nancy Chan, Deputy Chief Executive of Bank of Communications Hong Kong Branch.
“Each client is paired with a professional consultant, who advises on a wide range of issues concerning wealth preservation, accumulation and protection, including but not limited to portfolio management, financing, insurance, trusts, as well as sourcing of business partners. Services are underpinned by the bank’s different departments, but are delivered to the client through a single point of contact,” she explains.
“While private banking covers a lot of aspects ranging from wealth management to estate planning, the bank emphasises on understanding the clients priorities while meeting their specific life goals by building strategies around them and respond to their changing investment demand.”
“For example, there was a strong demand from our Mainland clients for Hong Kong’s investor residency programme a few years ago. We therefore provided related services and products to help them secure Hong Kong residency. And since a couple of years ago, global markets have become more volatile while the US has entered a rate-hike cycle in recent months. Demand for USD-denominated products has strengthened. We have introduced our clients to more USD fixed-income products, such as bonds, funds and insurance, through which they could hedge against market volatility.”
Now that many of Hong Kong’s wealthy families might have entered the second or third generation, estate planning and business continuity become paramount. “The old Chinese saying has it that wealth doesn’t pass on to the third generation. It's understandable for business founders to expect their children to manage the family business after graduation. The children may not have the same mindset. They may want to move off the management role and hire a professional manager. This way they could pursue their own career or interest elsewhere while retaining the ownership of the family business,” she explains.
“To us, no matter which generation the management is now in, we can formulate a holistic strategy to help the family preserve and pass their business and wealth down to their children and grandchildren.”
Chan says the Hong Kong Branch began to raise awareness of the need for business succession planning long time ago. Through different roadshows and seminars, clients are introduced the concept of business succession planning in order to get into a business succession mindset.
As mainland’s entrepreneurs have amassed enormous wealth over the years, they have come to realise that all eggs cannot be put in one basket. “It’s vital for them to diversify their investments across multiple asset classes, markets and jurisdictions. We believe Hong Kong makes a good platform to diversify their portfolios, spread risk and access to international markets.”
In addition to personalised, caring service, confidentiality and discretion have always been the hallmarks of the bank’s private banking unit. Therefore, it has put in place a set of stringent policies and procedures governing information access and security measures to maintain the maximum security and confidentiality of client information.
At Bank of Communications, the mission of its private banking service centre is to build a lifelong partnership with our clients, looking after their and their family’s financial well being, from generation to generation.