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Business News/ Companies / People/  Stanchart targets Asia’s emerging affluent
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Stanchart targets Asia’s emerging affluent

Stanchart targets Asia’s emerging affluent

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Singapore: Standard Chartered plans to hire 800 bankers in the next 12-18 months for a new service aimed at affluent Asians who do not currently qualify for priority banking services.

The London-based bank, which derives most of its earnings from Asia, also plans to provide online stockbroking services to customers beyond Hong Kong, India and Taiwan as part of efforts to cater to a larger proportion of Asia’s middle class, global head of premium banking Foo Mee Har said on Monday.

Global banks such as Stanchart and Citigroup have traditionally focused on wealthier Asians but are now trying to broaden their reach to the region’s fast-growing middle class, putting them in direct competition with local players in more affluent Asian cities such as Hong Kong and Singapore.

“Most of focus so far has been on high-net worth individuals and the affluent who are private banking or priority banking targets... Yet, emerging affluent is the fastest growing (segment) in the affluent space and the absolute size is significantly larger," Foo told Reuters in an interview..

Stanchart launched its “preferred banking" service aimed at emerging affluent customers in Singapore last week, and it plans to roll out the service in Malaysia, Hong Kong, India, the United Arab Emirates, China, Taiwan and Indonesia this year.

Foo, who is in charge of affluent customers not served by Stanchart’s private bank, said there is no let up in plans to aggressively expand consumer banking operations, notwithstanding the low interest rate environment that has hurt margins.

The bank is on course to recruiting in full the 800-850 relationship managers needed for its priority banking arm, which it relaunched last year despite fierce competition for staff.

“It is painful with the current low interest rate scenario... But the bank is in a very strong position and taking a long-term view," she said.

Stanchart defines priority banking customers as owners of small and medium enterprises as well as senior executives who typically have more than $100,000 to invest.

Emerging affluent clients on the other hand, are those with more than $50,000 to invest.

Stanchart estimates about 18 million people in Asia fall in the affluent category, while another 42 million can be classified as emerging affluent.

The affluent category is expected to grow by about 18% annually in the next five years while the emerging affluent category may see expansion of about 20%.

Online stockbroking, funds

Foo also said Stanchart will offer an online stockbroking service in Singapore next month that gives investors access to 15 stock markets, which is more than other banks and stockbroking firms currently offer.

The bank also plans to let customers in more countries buy and sell mutual funds online. The service is currently available in South Korea and Taiwan and will be introduced in Hong Kong and Singapore before the end of 2010.

Stanchart’s consumer bank saw an 85% growth in operating profit in the first half of 2010, helped by a fall in loan impairment charges. Its income grew by a smaller 8%.

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Published: 16 Aug 2010, 02:42 PM IST
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