On harnessing growth in the region, Mr. Chaddha is very clear: “HSBC Global Asset Management (HSBC AMG) regards SEA [Southeast Asia] as a strategic priority. There are two main reasons. First, the opportunity is huge for us to build on HSBC’s heritage and strong brand in Asia. Second, there are growing and varying wealth management needs across retail, HNWI [high-net-worth individuals], corporate and institutional customers in the region that we, as a global asset manager, are very well prepared to meet.”
Whether you are the head of a small or large company, being a good listener is perhaps one of the most crucial skills to master. That is why HSBC AMG’s investment and product platforms are interconnected so all its offices can share insight, best practice and a standardised investment approach that result in a better client experience anywhere in the world.
“We are expanding our shelf to cater to different investor profiles, whose specific interests are responsible investing, emerging markets, China growth, or simply looking to balance their portfolios with downside protection and diversify. In essence, we are aiming to become a one-stop shop for all our clients – whether institutional, wholesale or private banks,” Mr. Chaddha adds.
In today’s world, Mr. Chaddha believes that there are two paths for survival: scale or niche. His strategy of choice? Scale. “We have ambitious plans over the next four years to expand our distribution presence across Southeast Asia through partnerships,” he shares.
As the asset management industry enters a new era of digitisation and demographics, an awareness of trends and the ability to see beyond the status quo is crucial. According to a report published by PwC in 2014 entitled Asset Management 2020: A Brave New World, growth in assets will be driven by three key trends – a government-incentivised shift to individual retirement plans, an increase in high-net-worth individuals from emerging populations, and the growth of sovereign wealth funds.
The report also stated that economies of scale will become “paramount” – that is, global managers and alternative managers will have a presence in all geographical regions and channels. Technology will also drive businesses, particularly in the areas of customer engagement, data mining, operational efficiency and regulatory and tax reporting. By 2020, the report said, most global asset managers will have a chief digital officer.
“We are aware of the challenges of digital transformation, with the digitisation of data analytics and personalisation of services bringing about a convergence of retail and wholesale customer service lines. We also understand the changes that blockchain and robo-advisory are bringing about and we are working closely with our group businesses to better compete in these areas,” Mr. Chaddha says.
He has a positive view on digital disruption, and believes that technology will enhance customer relations, rather than dominate it. “We see digital disruption as a positive outcome for the industry. Having said that, we don’t think robo-advisers will dominate the industry, even in segments like the mass affluent where robo-advisers are poised to become the new normal. This is because human interaction is irreplaceable when it comes to investments. In the end, automation and tech will take care of the boring stuff, leaving people to add value and provide a better customer experience,” he says.
On the digital front, Mr. Chaddha adds that the company employs a ‘pull versus push’ approach. “We practice digital content marketing and genuine client education programmes for our intermediaries to better engage their clients. We listen to millennials who want a brand with a purpose and who want to be in control of their finances. And to make sure we put resources to address all this and more, HSBC Group plans to invest US$15-17 billion globally until 2020 primarily in growth and technology,” he says.
“We have diversified the business and allocated resources in such a way that in only three years we’ve become one of the fastest growing regions within HSBC AMG. This is thanks to our clear view and purpose on what we want to achieve and how to get there,” Mr. Chaddha says, when describing the company’s achievements in recent years.
He adds that moving forward, HSBC Global Asset Management (Singapore) is looking to build out its footprint in the Southeast Asian region. “We have laid the foundation and the results have been promising. For us to deliver our target, we are looking into opportunities to expand our presence through partnerships, whilst keeping Singapore as our ASEAN hub. In addition, we are also expanding our distribution and client base considerably,” he says.
A piece by Nazneen Halim. A version of this piece was first published in Asia Asset Management on 9th May 2019.