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ESG, luxury watches, crypto: Singapore private bankers change focus

Private bankers in Singapore are having to adjust the focus of their work. Relationship managers are delving into sustainable investing, digital assets and even fine art as investors’ demands evolve during Covid-19 pandemic.

William Chan, a private banker at Julius Baer, says his Singapore-based Chinese clients are channeling funds into cryptocurrency, luxury watches and art, as they find current equity returns “unattractive”.

“With Covid, clients cannot travel, so they’re spending more time reading up, and when they see reports on the auction prices of these assets, they see an opportunity,” he says. “But they don’t want to exit their equity position, so they’re collateralising their investments to the banks to invest in alternative assets.”

Last month, Bloomberg reported that UBS’s Asian clients were pouring billions into sustainable assets. Covenant Capital CEO Edwin Lee says Covid-19 has turbocharged the trend towards ESG (environmental, social, and governance) investments. “ESG companies are supposed to be cleaner companies – and Covid's hit on mobility and travel has benefited these companies,” he says.

Lee also points to digital assets – such as blockchain, non-fungible tokens and cryptocurrency – as a fast-growing category, given the global push towards digitalisation borne by the pandemic. Fintech and disruptive tech have been a “big focus” for ultra-high net worth clients, says Selby Jennings senior vice president Andrew Zee.

Lee adds that in general, clients are investing in the entire digital ecosystem: into VC funds, chipmakers, digital security companies, and even exchanges. However, as the digital assets industry is still in its infancy, portfolio allocations to this class of investment remain small, he adds.

Even those keen to stick with the tried and tested approach of buying blue chips and funding venture capital are now focusing on tech plays in addition to biotech firms, says OneRock Investments CEO Michel Della Libera. “People think tech companies will survive Covid the best, and they know the healthcare system must further develop and grow in several developing countries, so the companies improving themselves with new technologies and entering new markets will likely be the ones that can offer double digit returns,” he adds.

Photo by Jeremy Beadle on Unsplash

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