Why more investors are letting private banks decide what to do with their money
High-net-worth clients are increasingly choosing to let their private banks decide their investment strategies amid rising stock volatility
Market uncertainties are encouraging more and more investors to allow their private banks to decide their investment strategies.
Tan Wei-mei, director and head of portfolio solutions of Asia Pacific of Credit Suisse Private Banking, said her bank had seen a 200 per cent year-on-year increase in "mandates" - the private banking term for the funds clients entrust banks to invest at their own discretion - in the first half of this year and a 50 per cent year-on-year growth in mandate assets under management.
That compares with the annual growth rate of 10 per cent to 20 per cent in mandates in the past five years.
The key driver of the strong growth this year, she said, was a combination of market environment, the changing investment behaviour of the clients and the bank's almost doubling of its portfolio solutions team in Asia in the past year.
"As equity markets became more volatile this year, we have seen more high-net-worth clients opting for mandate solutions," Tan said.
"With the ageing demographics in Asia, we also see more clients who have retired and want to spend more time on the golf course rather than trading in the financial markets," she added.