NewBEA private bank leverages China branch network

Ask any private bank in the region where they cast the net for new clients and the answer is mainland China. Ask them how they do that and the answer is far more ambiguous.

Bank of East Asia's private bank says it has a strategy that has already boosted the share of private banking customers from mainland China, where growth in sheer wealth, along with the number of people with high net worths, is set to outpace other major economies in the decade to come.

The numbers, so far this year, show BEA might be on to something. In the first five months of 2015, the private bank had driven up its share of mainland Chinese assets under management by 18 per cent, Gloria Sun, the head of private banking, told the South China Morning Post. At the end of May, mainland Chinese assets represented 33 per cent of all private banking assets, up from 28.4 per cent at the start of the year.

By 2017, BEA aims to have half of its private banking assets hailing from mainland China - a goal that would be easily achieved if it could maintain the rate of pickup in the first half of this year.

The strategy has less to do with the private bank's operations, which are based in Hong Kong, and everything to do with BEA China's expansion in mainland China, which, by number of branches for a foreign bank, was second only to HSBC Ltd.

From Hong Kong, BEA's private banking operations look similar to many of the players in the market, if not much smaller. The bank does not disclose its assets under management although it said it grew 9 per cent last year. It has more than 40 relationship managers, compared with hundreds at the biggest private banks that have operations in Hong Kong.