Asking the Right Questions

Asking the Right Questions

Blame the pandemic all you want, but crisis periods are invaluable in providing perspective. Factors like our low-tax regime and free-market credentials have been attracting a healthy flow of foreign funds in recent years, but those reasons are now secondary to Singapore’s reputation as a safe haven amid Covid-19. Last year, the total assets under management of Singapore wealth management increased by 17 per cent to a staggering US$3.5 trillion (S$4.7 trillion).

With the world’s ultra-wealthy redirecting their attention here, even boutique private banking outfits like VP Bank have a solid chance at scaling. At least that’s what its newly appointed Asia CEO Pamela Hsu Phua plans to do in the next five years. “Our strategy for 2026 is to evolve, to scale, and to move,” she says. To do that, Hsu Phua, who left Pictet to join the Singapore office of the Liechtenstein-based bank in July, is looking at ways to increase engagement with their clients.

This is prefaced by the bank opening a brand-new Client Solutions division last year that will create access to new investment opportunities in the private market—an asset class that has traditionally been difficult to invest in thanks to high minimum amounts, non-transparent fee structures, and a lack of flexibility in the composition of product elements.

“We know that companies are staying private for longer, so we think about what the client wants to do. Do they want to wait until they get listed and go in with the rest of the market, or do they want to get in the game early? How do we bring together our networks in Europe and Asia, from our intermediaries to our private clients, so that we can have an exchange of ideas and deal flows?”

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These questions led to the launch of the ORBIT platform this August, which gives professional investors access to private markets without the need for an existing account with VP Bank. Flexibility and customization are also key here. “Let’s say you’re interested in a transaction. Do you necessarily want to put $1 million or even $5 million in each private equity deal you’re interested in? That’s the norm right now. Instead, let’s cut it up, look at where your interests are, and develop a portfolio based on what offerings there are and what the market shows.”

  • DIGITAL AFFAIRS
  • PANDEMIC’S LESSONS
  • BANKING’S NEW FACES
  • LEADING WITH HEART

Digital Affairs

With ORBIT, VP Bank has successfully combined traditional wealth management with the advantages of digital ecosystems, but its digital strategy doesn’t end there. One of the areas Hsu Phua wants to focus on is client engagement. “Quite often when you go to a private bank, you sign physical documents and do things the traditional way. But our younger clients can place orders online, so we want to see how we can get closer to them,” she says. “We’re looking at using facial recognition technology for online account openings, and other ways that private banks have not embraced yet.” Indeed, the only bank in Singapore to offer this service currently is DBS, which uses the SingPass Face Verification feature.

New tech comes with new risks, but Hsu Phua assures us that VP Bank has been investing heavily into its compliance systems and team, and are actively looking to put in place more sophisticated systems to boost its cybersecurity and anti-money laundering (AML) frameworks. 

Of course, a conversation about digital strategies wouldn’t be complete without touching on digital assets. While VP Bank is still figuring out how it can work with cryptocurrency, it has made a move into tokenization. “We have already launched a pilot project for art tokenization in Switzerland,” she shares. “This is another way in which we look at a client’s world. We don’t only have to talk about your stocks, bonds and cash. You may also have artwork, jewelry, property, aircrafts—so what we want to do is work with you and make those things a meaningful part of your entire asset allocation and portfolio.” Once the team has fine-tuned the nuts and bolts, the service will be rolled out in Asia.

“The world is changing so quickly. How many of us had iPhones 10 years ago, taking pictures the way we are now? We in this industry really have to get off our high horses and move alongside whatever is happening around us.”

  • DIGITAL AFFAIRS
  • PANDEMIC’S LESSONS
  • BANKING’S NEW FACES
  • LEADING WITH HEART

Pandemic’s Lessons

But as we all know there is another, more tragic way the world has changed. The public health crisis’ effect on the economy has been disruptive, to say the least, and it was fortunate that VP Bank’s decision to pivot early into digitization helped them transition smoothly to the new normal when face-to-face meetings were halted. “I was recently speaking to one of our clients, who also has relationships with two other larger universal banks. And he said that the experience he had with us was so different because it was so much easier to reach us during this season,” she says, explaining how online orders were easy to place so clients didn’t have to call a night desk.

But it’s not just an increase in online transactions that Hsu Phua has noticed. “Inevitably, there have been more conversations about succession planning, sustainability, philanthropy and ESG (environmental, social and governance),” she says. “These weren’t things people thought of when the world was still open and we were free to travel. But right now, we all want to be close to our families.”

With Hsu Phua’s last role being head of Pictet’s Asia Family Office, she is well-equipped to develop VP Bank’s family office engagement. “There are more family offices being built up in Singapore now, and when families think about succession, they’re not just thinking of one or two generations after, but the third and fourth. The conversation continues.”

Philanthropy has also been kicked into high gear during this period, as non-profit information service Candid reported at least US$10.3 billion committed globally by philanthropists. It’s also being channeled faster, with almost 750 foundations having signed a public pledge to streamline grant-making processes, according to Council on Foundations. “It’s clearly a key topic,” she agrees. “And through Client Solutions we have a unique engagement where we bring clients and foundations together in roundtables. We also have an exclusive online network that will allow them to exchange their philanthropic endeavors in a safe environment, that they can support one another.”

  • DIGITAL AFFAIRS
  • PANDEMIC’S LESSONS
  • BANKING’S NEW FACES
  • LEADING WITH HEART

Banking’s New Faces

Dress by Sport Max

Private banking is as much a business about people as it is about wealth, and Hsu Phua is aware of its changing demographic. “I had lunch with a co-worker the other day, and he turned up in a polo t-shirt and denims. He apologized for his attire, but said his client really doesn’t like him coming in a suit and tie,” she laughs, revealing that the client was a young entrepreneur. “So, you have to be nimble and agile because the face of private banking and wealth creation is changing.”

VP Bank is also expecting more of these faces to be Chinese, as it recently acquired a 3.4 per cent stake in Hong Kong-based Hywin Asset Management in March, as an extension of the two parties’ strategic partnership that was first established in 2019. VP Bank will benefit from access to Hywin Wealth’s client base, while Hywin Wealth will be able to use VP Bank’s modern infrastructure and offshore wealth management offerings.

“As part of this collaboration, we have identified women in business as a key interest point. After all, women hold up half the sky,” she says, quoting the famous Chinese slogan that affirms how women are just as capable as men on the professional front.

Hsu Phua herself is living proof of this. Together with the likes of DBS’ Tan Shu Shan, who was appointed head of its Institutional Banking Group in 2018, as well as Helen Wong, who became OCBC Bank’s first female group chief executive in April, it would appear that women are finally taking top banking spots in recent times.

In an industry historically dominated by men, Hsu Phua concedes that “when you’re in a room full of people with very similar backgrounds, you will only get one point of view.” But she’s quick to point out that the focus shouldn’t be on gender, but diversity and merit. “I find it a little bit patronizing to women if all we’re talking about is gender. What we need is diversity across lived experiences. I’m not here because I’m a woman and an Asian. I’m here because I’m a proven professional with over 20 years of experience building up businesses.”

  • DIGITAL AFFAIRS
  • PANDEMIC’S LESSONS
  • BANKING’S NEW FACES
  • LEADING WITH HEART

Leading With Heart

Hsu Phua is daintily built, and her well-articulated, gently lilting voice adds to her aura of warmth. Graceful and gracious, she may not fit the image of a banking head honcho for those who are more familiar with the more aggressive archetype. But make no mistake, the woman is all grit and quiet strength.

She got her start in private banking in 1998 when she joined Paribas as an associate before moving on to Credit Suisse as its assistant vice president. In 2006, she was asked to join Julius Baer as a director, and it was during this time that Hsu Phua was offered the opportunity to establish the bank’s intermediary presence in Asia with a posting in Hong Kong. “I was young, single and had never lived in Hong Kong so I thought it was exciting to do something brand new,” she says. “They told me that when I get there, they would take care of me, introduce me to the right people, and have everything set up. But when I got there, all they said was, ‘This is your desk, your chair, your phone and your computer. Now figure it out.’”

Virtually alone in a foreign country and in the thick of the 2008 financial crisis, it was sink-or-swim. “I was practically knocking on doors trying to introduce Julius Baer at the time, because very few people had heard of us. It was through literal sweat and tears on that desk that I managed to grow the business to one of the biggest in the intermediaries segment.”

Dress by Dolce & Gabbana

Hsu Phua isn’t just a force of nature, she’s a force for good. If it weren’t for the Hong Kong posting, she would have taken time off to pursue a PhD in social marketing at The University of Texas at Austin. Instead, she used her holidays to take service trips around the world. “When my husband and I got married, he said that one of the things that attracted him most was my grateful heart,” she says. “So, I suggested that for our honeymoon we go to Lesbos Island in Greece and volunteer at a refugee camp!”

Even in this aspect of her life, Hsu Phua’s fortitude shines. “I used to volunteer in Kolkata and it was actually really depressing. Because there was so much going on, it felt like we were always getting knocked back and that we weren’t doing anything,” she recalls. “But my host said to stop thinking about the millions, and to just think of one person I’m helping.”

It’s a philosophy she carries over to her work, too. “I can think of this as an organization, but I prefer to think about all the individuals in the organization, and the impact we can have on the individual lives our colleagues and our clients. What can I do to develop their family office, plan their family constitution and setting up their legacy for the next generation? How can I help you develop these ideas into something that will last? It’s like the starfish parable — I want to make a difference one person at a time.”

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Source Credit: This article originally appeared on Portfolio Magazine by PORTFOLIO Magazine. Read the original article - https://www.portfoliomagsg.com/article/asking-the-right-questions.html