Winners rationale

2018 was anything but plain sailing for China’s private banking industry, as local regulators rolled out a comprehensive set of reforms and markets creaked under the pressure of a brewing trade war. To be sure, no bank was immune, and as a direct result of regulators’ wide-spanning directives, private banks were compelled to revisit all aspects of their operations, from business strategy and product provider relationships to research capabilities and client servicing.

As China’s largest and arguably most sophisticated private bank, China Merchants Bank Private Banking is playing a leading role in guiding the industry into this new era. Credit must go to CMB for being the first bank to announce it would set up an asset management subsidiary in anticipation of coming regulatory reforms and later leading the pack by announcing its plan to excise a considerable amount of wealth management product AUM — bold moves that demonstrated CMB’s sense of responsibility. It has also conducted a complete and far-reaching review of its products sales process and was the first private bank in China to implement a certified sales mechanism.

All the while, CMB has remained focused on getting the basics right, which equates to understanding the specific needs of clients and delivering a differentiated and best-in-breed investment and asset allocation service. During the first half of the year, it created what it calls the ‘five-dimensional customer development system’ and has made major headway in the application of fintech solutions in asset allocation and risk management, mobile client interfacing, and the dissemination of research. In addition, its own Wealth Management System was upgraded in 2018 to provide stricter management around client servicing and sales activities.

But what is true of any private bank worth its salt is that the strength of its client offering depends on that of its people and product platform. In both cases, CMB is the domestic industry leader. Beyond selective external recruiting, it has established a comprehensive internal training system for new and existing employees and conducts monthly performance evaluations to monitor the health of the business. CMB also stands out for its deployment of an investment consultant service to fortify risk management and asset allocation.

Its product shelf is fully featured within the boundaries set by China’s regulatory framework and covers more than six major classes and 30 subclasses, while clients are surrounded by a raft of value-added services, including tailored offerings for next-gen elites and family offices. Moreover, in 2018 CMB launched its Wealth Institute for entrepreneur clients to develop their management skills and provide networking opportunities.

With a strong and evolving foundation in place and an unwavering dedication to providing personalised and professional wealth management services to China’s growing pool of HNWIs, CMB continues to amass clients and assets, which at last count totalled 72,365 and RMB 2.05 trillion, respectively.

China Merchants Bank is Asian Private Banker’s Best Private Bank – China Domestic in 2018.