Managing wealth a question of trust as Zedra opens Hong Kong office

Zedra, formally Barclay’s trust business, launches in Hong Kong, and says that the world of the Panama Papers is a thing of the past

PUBLISHED : Sunday, 25 September, 2016, 7:09pm
UPDATED : Sunday, 25 September, 2016, 10:31pm

Zedra, a trust company formed by a management buy in of Barclays trust business has formally launched their new offices in Hong Kong, joining the flood of businesses hoping to provide services to Asia’s new wealthy.

Zedra group’s deputy chairman, Bart Deconinck said: “When we acquired Barclays trust business we saw that Hong Kong was missing on the map.”

The company will offer corporate services to foreign companies hoping to do business on the mainland, and also offer trust services to Hong Kong companies and individuals.

“On the trust side, I think we will see significant business growth in servicing the Asian market,” said Zedra’s Hong Kong managing director, John Ashwood.

“One of the trends of the last 10 years is that Asian families are becoming more sophisticated about passing the family business on to the next generation.”

According to a recent report from Hong Kong’s Private Wealth Management Association, there are 200,000 high-net-worth individuals in Hong Kong, collectively holding around US$1.1 trillion in wealth, while the total wealth of mainland Chinese billionaires grew by 53 per cent in 2015.

The competition to manage this wealth and provide services to its owners is fierce, but Ashwood says that as a specialist trust firm, Zedra is operating in a slightly different space.

“Typically institutional trustees such as the large banks, are fairly limited in their scope of the services they can provide. A typical bank trust will only have bankable assets in it, and for many clients particularly in this part of the world the wealth derives from businesses that they have built,” Ashwood said.

“Also, the trend over the last few years is that even the institutional trustees have been losing their trustee services as it’s not part of their core business. At Zedra, we are an example of that ourselves.”

The trust business around the world is also being forced to change, because of new regulations and a growing interest from tax authorities and the media into the previously secret assets of the global super rich. The recent Panama Papers, and Bahamas Papers leaks are both an example and a further driver of this.

Deconinck is dismissive of the impact of the leaks.

“They are totally irrelevant,” he said. “What we saw in the Panama Papers was a view on how things used to be, but the regulators have caught up in the meantime, and now we are here in this transparent world of information exchange, and any bank account information will be exchanged from January 1 next year.”