TRANSFORMATION is a recurring theme in Chew Mun Yew’s career of more than two decades in the financial services sector. He is UOB managing director and head of private wealth.
Unfazed by keen competition and a challenging investment backdrop, Chew is determined to expand UOB’s private wealth business. He eyes segments of potential clients. One major segment is the proverbial low-hanging fruit of entrepreneurial clients, among whom UOB as a full-service Singapore bank provides rich pickings.
“The UOB wealth business has done very well, but there is a lot more we can do. We haven’t fully realised our potential. We’re still not at a size that I think we can be. This is a business where size and quality matter. You have to grow to greatness; you can’t shrink to greatness. We have very compelling reasons to get there.’’
Chew studied philosophy at the National University of Singapore, after which he obtained a Master in Philosophy from the University of Oxford and a Master of Business Administration from Insead in France. He has come a long way since his first job as a philosophy lecturer at NUS. He joined the Monetary Authority of Singapore as a regulator for banking and insurance in 1998, and has not looked back since.
In each of his career moves in banking, he says he has achieved transformation, whether it’s to rebuild poorly performing businesses or to take healthy franchises to new levels. In the midst of the 2008 financial crisis, for example, he and his team were instrumental in the turnaround of Ta Chong Bank in Taiwan, under the watchful eye of the Carlyle group.
He also achieved a near doubling of revenues in his stints at UBS and Julius Baer, where he was head of their Greater China businesses.
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At UOB, assets under management for private wealth is reported under the group retail business, where AUM rose 4 per cent to S$139 billion in 2021. Private wealth’s share of that is understood to be more than half. New net asset inflow is also understood to hit a record high last year. “We would think that sweet spot would be in the range of S$100 billion to S$120 billion, for us to compete effectively with scale.”
Just as investment alpha is highly coveted by portfolio managers and investors, Chew believes there is a similar alpha in management. “You need the right leader, who builds a good team. The leader sets out a meaningful purpose and galvanises the team to make the right decisions and take actions, and that leads to performance. I think it’s no different from investment. These elements allow me to discover and deliver management alpha much faster.’’
In every stint where he is in the hot seat, he mulls over some key elements. “First you need to understand what has caused (a business’) underperformance. Because if you don’t know the cause, you’d be fishing in the dark. Then you need to quickly make decisions on the landscape you are playing in. Is it conducive for you to continue? If the answer is yes, how do we find a space to compete? How can we be compelling? Once you have clarity on that, the next question is – can we organise ourselves to deliver value?’’
For UOB in the private wealth space, the backdrop and its inherent strength are propitious. In terms of the landscape, wealthy clients in Asia typically hold multiple bank accounts, even though there has been some consolidation through the years. This gives UOB ample room to make its mark. In addition, while Swiss and European private banks have made inroads, there is still a preference for a strong Asian – and specifically, Singapore – bank, with a strong network, capital base and operating within a trusted regulatory framework.
To top that off, UOB boasts a regional presence and strong commercial banking franchise, from which it could cultivate entrepreneurial clientele as they move up the wealth curve. “Our footprint in Asean is the largest, but more than the footprint is our familiarity with business owners in Asean. If you seek to come to Singapore for diversification, because your assets are safer here and you’re attracted by our Asean proposition, then going with UOB is very compelling.’’
Over the past year, Chew says the bank has activated an internal referral system where UOB bankers in the region may refer clients to the private wealth arm. The group has a network of more than 500 branches and offices in Asia-Pacific, Europe and North America. The group has also quietly beefed up its team of relationship managers for private wealth to over 300, after hiring around 55 last year. Even as it continues to hire mid-career bankers, UOB is also keen to launch an apprenticeship programme, focusing on training graduates of polytechnics instead of universities.
Within private wealth, UOB’s offerings are comparable to other private banks and span the range of wealth structuring and investment services. Its discretionary portfolio management (DPM) service has achieved top quartile returns for 2022, based on data by a third-party performance consultant.
In terms of investment services, clients may choose among three broad avenues. DPM is a risk-managed option for clients who seek to fully delegate investment management to professionals. Clients may also take a transactional route if they prefer. There is also an advisory route which UOB plans to roll out, with risk profiling and strategic asset allocation capabilities to serve as a cornerstone for portfolio investments.
UOB is cautiously optimistic that the global economy may escape a hard landing. Chew says: “We advise our clients on how to build more resilience into their portfolios, and also to position themselves so that when there are positive developments, they can capture the upside.’’
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