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SINGAPORE : The private banking industry in the region is in need of an overhaul to bring the focus back to providing quality service.
Experts said the economic boom in recent years has seen banks focusing only on getting more customers.
This has led to poor service from relationship managers who are overloaded with too many clients.
Estimates by Standard Chartered show that relationships managers deliver the best returns on portfolios when they have between 50 and 60 clients.
But the recent growth in the wealth management in the region has seen managers handling over 200 clients. This has resulted in poor service and unhappy customers.
Rajesh Malkani, Regional Head of Private Bank, SEA, Standard Chartered, said: "In our minds, the model of having 50, 60 customers per relationship manager is the right model for the top end of the wealth management industry.
"If a relationship manager has 250 customers, how often do you think a relationship manager will be able to reach out to each one of these customers, even on a monthly basis?"
Industry watchers also said private bankers need to move away from a focus on short-term gains and increasing client numbers.
Tee Fong Seng, Managing Director, Head of Wealth Management, SEA, UBS AG, said: "Wealth management is a long-term business in UBS and in the industry, and the compensation model today is short-term driven. So I think they will go through a whole transformation and reform."
Experts said private banks need to overhaul themselves in order to stay relevant and useful in an increasingly challenging business environment. - CNA/ms
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