China’s newly rich courted by international private banks
About 3.9 million mainland Chinese families will be classified as wealthy by 2020 Credit Suisse, survey says
Credit Suisse Chief Executive Tidjane Thiam emphasised the importance of China and east Asia for the bank, as it seeks to service the growing numbers of wealthy people in the region.
“We disagree with the thinking leading some players to withdraw from Asia,” Thiam said. “Whether China’s GDP grows at 5, 6 or 7 per cent, the majority of GDP growth in the world will come from emerging markets, and from entrepreneurs who are building businesses in those markets. We want to be a bank for those entrepreneurs,” he said.
“We are taking a long term approach, not competing head on with the Chinese banks, but rather focussing on segments of the market where we know we can create value,” he said.
Globally, Credit Suisse’s shares are down almost 50 per cent so far this year, and on July 3, Swiss newspaper SontagsBlick reported that there were rumours that the bank would break up or be taken over. Thiam dismissed the rumours, telling the Swiss newspaper: “The group will stay intact. A takeover is not a topic for discussion.”
One area in Asia Pacific where Credit Suisse is looking to expand its activities is private banking. Since the first quarter of 2015 the bank has recruited 100 wealth managersin the region, and aims to have a total of 800 wealth managers by 2018.
The opportunities in this sector are concentrated in China. According to research from China Industrial Bank and Boston Consulting Group the number of China’s high net worth families will reach 3.88 million by 2020.