Nomura bulks up Asia wealth business in quest for bigger share of lucrative segment
By Anshuman Daga
SINGAPORE (Reuters) - Nomura Holdings is steadily building its global wealth management business and plans to further expand its Singapore and Hong Kong hubs, as Japan's biggest securities firm accelerates a push into a highly competitive sector. Just over a year after Nomura snagged Ravi Raju to spearhead its ambitions in the wealth operations, the veteran banker has led a hiring spree as part of its efforts to diversify from its home market and capture a slice of an affluent and growing pool of Asian clients.
"All the studies done by external experts show that wealth in Asia is going to be growing at 8-10% on a yearly basis. The pie is growing and our piece of the pie is also expanding," Raju, the head of Nomura's international wealth management unit, currently centred in Asia, told Reuters in an interview.
Nomura has already hired more than 50 relationship managers from banks including Citigroup, Deutsche Bank and BNP Paribas, targeting Asia's wealth management revenue pool that a Boston Consulting Group report in June said will soar faster than any other market worldwide, nearly doubling over the next five years to $52 billion.
In April 2020, Nomura brought its wealth management unit exJapan under its wholesale division - made up of its global markets and investment banking franchises.
The strategy involved offering large entrepreneurs and high networth individuals access to Nomura's vast array of financial products and investment banking services under one roof, while leveraging the firm's status as the top wealth manager in Japan.
"We had a good first 12 months. As we have expanded with more relationship managers and they are onboarding their clients, our assets under management will continue to grow," said Raju, adding that the business was also growing from Nomura's existing bankers and clients.
Singapore-based Raju, who has had a 30-year stint in financial markets, is credited with building up Deutsche's asset and wealth management franchise in Asia. He last spent nearly four years at UBS heading its Asia Pacific ultra high networth and global family office business.
Over the last 12 months, Nomura added a record total of about 600 new customers in its global wealth management unit, said Raju, 54, who joined the group in late 2020.
However, he has his work cut out as Nomura isn't even in the top-20 ranks of private banks in Asia for 2020, according to industry publication Asian Private Banker. Banks such as HSBC and Standard Chartered are also doubling down on Asian private banking to boost growth as they compete with Swiss giants UBS and Credit Suisse. Nomura's international wealth assets have risen to $13 billion currently from $8 billion in September 2020 and Raju said it is targeting to manage $25 billion to $35 billion by March 2025.
"Where we can differentiate ourselves through our research or discretionary portfolio capabilities, we are going to be doing that with family offices and ultra high networth clients."
He said Nomura could offer clients access to private placements by Japanese firms and also potential Japanese investments into Asian companies. "In the next two years, we are looking at hiring another 50 relationship managers, taking our total to between 135 and 150," he said, adding that a majority of the hired bankers focus on clients from Greater China where the ranks of the wealthy are soaring.
While Singapore and Hong Kong are Nomura's key wealth centres for Asia, it is also seeking to expand elsewhere. "In the next 6-12 months, we'll look at the feasibility of placing people in Dubai as a marketing centre for our Middle East business," said Raju.
(Reporting by Anshuman Daga; Editing by Shri Navaratnam)
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