• Featured Expert Of The Month(Aug)
• THE GOOD, THE BAD, THE TWEET

By: GABRIEL CHEN (FINANCE CORRESPONDENT)
Publication: The Straits Times 16/02/2011

Wealth management unit ensuring clients are served by talented staff

THE chief executive of UBS Wealth Management Singapore has conceded that the Swiss bank hired too "aggressively" in the boom years leading to the financial crisis.

Ms Christine Ong revealed in an exclusive interview that UBS will now be focusing more on hiring experienced private bankers with the skills to navigate the new landscape of tougher international regulations and more discerning clients.

"I think clients ask more questions. They are more wary of ideas they have never seen before and products they cannot easily understand," Ms Ong told The Straits Times.

In 2006 and 2007, UBS expanded its market share in Singapore by hiring armies of private bankers. Many did not have much experience servicing the very rich but had worked in the finance industry for six to eight years in various customer-facing roles.

The intention was to put these younger executives – some sold investment products to retail or mass affluent customers, for example – through the UBS platform and "transform them into private bankers who can manage assets".

The result was that UBS more than doubled its Wealth Management headcount here from 2004 to 2008.

Unfortunately, the success rate was not that high, according to Ms Ong, 53, who took over the Singapore role in early 2009.

"They were probably good asset gatherers but not holistic asset managers who could actually use our entire platform across all asset classes," she admitted.

The war for talent got fiercer with competitors such as Credit Suisse doubling their hiring efforts.

UBS competed by scaling up its recruitment of fresh graduates and also unveiling a new programme to hire people in other industries with no banking experience, including lawyers, musicians and engineers.

But much of UBS' hiring in those days centred on the lesser experienced bankers who would be groomed to "hit the ground running after the first month or so".

"We were at any one time hiring 70 to 80 new bankers every year in those two years," Ms Ong said. "We decided at that time that we had to create a distance between ourselves and the next competitor, so we looked at how we could double our asset base within three years and invest in talent."

The crisis saw UBS suffer heavily from its exposure to the United States sub-prime home loan market and the subsequent credit crunch. There were massive job cuts across the bank to trim costs.

Today, UBS is strengthening its wealth management business with senior appointments. This is in line with its new strategy of taking on more experienced private bankers with a global mindset and who are client-focused and possess a sophisticated understanding across all asset classes.

Last year, Ms Annie Margono joined as chief representative of UBS in Indonesia, while Mr Philip Kunz joined as regional market head, South Asia.

Senior JPMorgan banker Elan Cohen also joined UBS to further strengthen its client coverage of the ultra high net worth segment in South Asia.

UBS now has more than 1,000 wealth management staff in Singapore, which is about where its staffing levels were in 2006.

Ms Ong said there are lessons to be gleaned from the way it operated during the last few years. "At that time, we were able to increase our market share and we brought in quite a number of good people," she said. "Can we do it better? Yes, we can definitely be more focused to get a higher success rate. Whether that is the formula that one should use at this time, I would probably do things differently.

"The success of our wealth management franchise depends on talented people to deliver excellent service and investment performance."

TALENTED STAFF

"The success of our wealth management franchise depends on talented people to deliver excellent service and investment performance."

Ms Christine Ong, chief executive of UBS Wealth Management Singapore