Wealth Management in Malaysia

Transcription

1 Brochure More information from Wealth Management in Malaysia Description: Malaysia's steadily developing and highly diverse wealth management sector is growing in importance as the market matures into a high income country and as it develops one of the world's pre-eminent Islamic finance centers. Few other countries offer Malaysia's mix of Asian and Islamic influences in their private wealth management market, providing an example to the world. Scope of the report: - Build your customer targeting strategy using in-depth HNW demographics and needs analysis based on Datamonitor's annual Global Wealth Manager Survey. - Assess your competition through detailed profiles of notable players, including the customer targeting, marketing and product strategies they employ. - Size your potential client base using Datamonitor's proprietary data, presenting the number of affluent individuals by liquid asset band to Highlights: - The consistently strong performance by the HNW segment in the Malaysian wealth market suggests that private bankers will be able to rely upon a steady stream of new clients for growth rather than having to win new clients from established rivals. - As one of Asia Pacific's smaller yet open economies, Malaysia has closely tracked the regional average in terms of growth. In 2009, the country experienced a sharper contraction during the recession that resulted from the global financial crisis of 2008, much like Singapore did but suffered no contraction in the number of wealthy. - Malaysian HNW individuals have devoted considerable sums to fixed income products, with 15.5% of aggregate financial wealth held in these products. Most of these fixed income products are likely to have been held through bond funds however as individual investors have not typically held bonds directly, despite its well developed bond markets. Key questions answered: - What strategies are my competition employing to win and keep affluent clients? - How big is my target client base and how is it set to grow through to 2015? - What are the most effective acquisition techniques that I should use to build up my client base? - What products and services will have the strongest client demand going forward? Contents: OVERVIEW Catalyst Summary Methodology EXECUTIVE SUMMARY The growing affluent population accounts for only a tiny fraction of Malaysia's total adult population High net worth Malaysians will total almost 27,000 individuals by 2015 Growth in HNW assets is forecast to remain largely consistent with pass trends at 7.1% on average Real GDP growth in Malaysia has been running close to the regional average The Malaysian wealthy individual is one of the more difficult to service in the region Moderate knowledge and a conservative attitude make for a difficult client profile In broad asset class terms, Malaysian HNW individuals have the largest proportion of their portfolio in equities Malaysian wealth managers must be able to deal with high degrees of financial illiteracy The Malaysian wealth management market is predominantly in the hands of commercial banks The Malaysian financial services market operates a dual system: conventional and Islamic Trends in Malaysian wealth favor a more prominent role for Sharia-compliant asset management CIMB aims to expand AUM by 43% over a three year period

2 SIZING AND FORECASTING THE AFFLUENT MARKET IN MALAYSIA Key macroeconomic data Recent macroeconomic trends and performance As measured by GDP, Malaysia is only a small country, ranking behind even the city state of Singapore Malaysian inflation is below the regional average and forecast to remain moderate for the next four years Long-term and short-term interest rates are trending higher, which should begin to impact on credit conditions Stock market capitalization in Malaysia is small but growing in prominence in the region Wealth in Malaysia is very unevenly distributed compared to the regional average Regulation of wealth management in Malaysia Industry regulators Industry associations Recent legislative developments Sizing and forecasting the onshore affluent Malaysian population The growing affluent population accounts for only a tiny fraction of Malaysia's total adult population Malaysian affluent assets will total in excess of $200bn in 2015 The offshore market of Labuan is small but growing The offshore Labuan market has been developing steadily, although it faces stiff competition from Singapore and Hong Kong Labuan mainly provides HNW individuals with the opportunity to invest in Malaysian fixed income products HNW CUSTOMERS IN MALAYSIA Who is the Malaysian HNW investor? Most HNW individuals are between 31 and 50 years old Women account for only a minority of the market, making it easy to overlook The majority of HNW individuals have amassed their fortunes through entrepreneurship Malaysian HNW individuals are heavily exposed to equities In broad asset class terms, Malaysian HNW individuals have the largest proportion of their portfolios in equities Detailed asset class analysis shows Malaysian HNW individuals have the most invested in equities HNW portfolios are expected to be stable over the next two years as internal drivers continue to influence growth-oriented assets The Malaysian HNW individual has little in the way of sophisticated wealth services available Current provision of wealth services is low, with a focus on planning rather than management Credit cards and cash management are the few services that attract significant levels of demand Looking forward two years, strong demand for mortgages is anticipated Malaysian HNW individuals are not financially sophisticated but are open to switching Malaysian wealth managers must be able to deal with high degrees of financial illiteracy A high premium is placed on face-to-face contact Malaysian investors are open to new wealth managers, making retention an ever-present issue for the market Malaysian HNW individuals tend to work with three to five wealth managers The majority of Malaysian HNW individuals hold one-fifth to one-third of their portfolio with a single wealth manager Customer referrals followed by referrals from a retail bank are the most effective means of customer acquisition COMPETITOR DEVELOPMENTS IN MALAYSIAN WEALTH MANAGEMENT Introduction Business models of Malaysian wealth managers The Malaysian wealth management market is predominantly in the hands of commercial banks However, there are some notable independent wealth managers Competitor trends Significant competitor entrants and mergers and acquisitions have been more muted than other markets Trends in Malaysian wealth favor a more prominent role for Sharia-compliant asset management Directly held fixed income products are likely to grow in importance Key competitors in Malaysian wealth management AmBank CIMB HSBC Maybank APPENDIX

3 SUPPLEMENTARY DATA Definitions High net worth (HNW) Liquid assets Mass affluent Measures of growth Onshore Sharia-compliant investments Sukuk Takaful Methodology Overall methodology Global Wealth Model methodology Global Wealth Managers Survey 2011 Selected bibliography Articles Further reading Ask the analyst Disclaimer TABLES Table: Malaysia macroeconomic indicators Table: Number of affluent individuals in Malaysia, f Table: Number of mass affluent Malaysian individuals by asset band (000s), Table: Number of mass affluent Malaysian individuals by asset band (000s), Table: Number of HNW Malaysian individuals by asset band (000s), Table: Number of HNW Malaysian individuals by asset band (000s), Table: Mass affluent Malaysian assets ($bn), Table: Mass affluent Malaysian assets ($bn), Table: HNW Malaysian assets ($bn), Table: HNW Malaysian assets ($bn), Table: Domestic banking groups by license and wealth management activity, 2012 Table: Foreign banking groups by license and wealth management activity, 2012 Table: Capital Markets Services License holders for Financial Planning Table: AmBank figures (MYRm), Table: CIMB wealth management (MYRm), Table: Maybank AUM and fee income (bn), Table: Labuan deposits split by residency and mutual fund statistics, 2008 Q FIGURES Figure: Malaysian HNW individuals favor equities over any other asset class Figure: Malaysia's economy is dwarfed by its neighbors Figure: Malaysian GDP growth is expected to keep the country expanding at approximately the regional average Figure: Malaysia has managed to achieve a below average inflation rate for the Asia Pacific region Figure: Interest rates in Malaysia are forecast to rise, increasing the attraction of Ringgit deposits and bonds Figure: The more stable Malaysian equities market has seen the country's share of regional capitalization climb since 2007 Figure: Malaysia has an above average concentration of the nation's wealth in the hands of the rich Figure: The affluent population is growing, but remains a tiny fraction of the total adult population Figure: Mass affluent numbers have grown through two major global disruptions Figure: 2011 was the first year that Malaysia could boast more than 20,000 HNW individuals Figure: Affluent assets have risen steadily during both boom periods and the global recession Figure: Malaysian mass affluent assets are concentrated in the $ ,000 range Figure: The Malaysian HNW and ultra-high net worth segments hold the single largest pool of assets Figure: Offshore deposits are up in Labuan, but mutual fund values are down Figure: The LFX has attracted a steadily growing pool of Islamic debt while conventional bonds have stagnated Figure: Malaysia has a much greater concentration of wealth by age than is typical of the Asia Pacific region Figure: The Executive Takaful Retirement Plan allows for Sharia-compliant retirement planning Figure: The Malaysian HNW market conforms to the overall regional average Figure: CIMB Wealth Advisors offers women additional cover from AIA that addresses female=only

4 protection concerns Figure: HNW individuals in Malaysia are most likely to have generated their wealth from their own businesses Figure: Malaysian HNW individuals favor equities over any other asset class Figure: When viewed in more detail, Malaysian HNW individuals' reliance on equities is even more pronounced Figure: There is expected to be a minor redistribution of cash into riskier assets Figure: Outside of basic transactional banking products, wealth managers in Malaysia have a patchy lineup of services Figure: Few wealth managers are looking to invest in their asset management services Figure: Asset management services in Malaysia are characterized by low client demand Figure: Of any credit products, only credit cards and the status they can bring see strong demand Figure: Strong demand is largely absent from the Malaysian market, although Sharia-compliant services have a higher level of demand locally Figure: Cash management will be an enduring demand for the HNW client base Figure: Demand for mortgages should outpace that for credit cards Figure: Demand for Sharia-compliant services will prove to be stable over the next two years Figure: HNW individuals in Malaysia are generally not sophisticated investors, and often shy away from risk Figure: Private banking in Malaysia is built on personal relationships Figure: Telephone interaction is the norm in the Malaysian private wealth management market Figure: Neither brand nor a relationship with a wealth manager make Malaysian HNW individuals loyal clients Figure: Malaysian HNW individuals are likely to have between three and five wealth partners Figure: Wealth managers are best to leverage their own customer base for new wealth clients Figure: Press advertising to support an acquisition drive is not an effective use of time or money Figure: Conventional banks dominate the retail market for deposits Figure: The private bank is situated within the investment bank, although other divisions assist with wealth management activities Figure: AmBank-ANZ Get Set makes it easy to open up an Australian student account with ANZ Figure: The AmBank World MasterCard has been heavily advertised in the major Malaysian papers Figure: CIMB is organized both along geographic as well as functional lines Figure: Most conventional wealth management services at CIMB have an Islamic equivalent Figure: CIMB Preferred gives customers a taste of the private bank Figure: CIMB has consciously tried to regionalize its offering, and its advertising backs this up Figure: HSBC begins developing a relationship-based banking arrangement at even fairly modest wealth levels Figure: HSBC offers clients exclusive third party products in addition to its own Figure: The private wealth management division is a small part of the overall community financial services division Figure: Maybank has moved to a customer-centric business model that divides its clients into five groups Figure: Global Wealth Managers Survey 2011 geographic coverage Ordering: Order Online - Order by Fax - using the form below Order by Post - print the order form below and send to Research and Markets, Guinness Centre, Taylors Lane, Dublin 8, Ireland.

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