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  1. Wealth
November 16, 2010

Asian overkill

By Spear's

There is a lot of wealth being made in Asia right now but I’m going to write something pretty obvious ’ the supply of private bankers just isn’t there

Being allowed to say what I want as long as it is logical is one of the upsides to my job. I like that. Being paid for it is a bonus in some ways. Now, before you all start clambering for a consulting jobs there is a caveat. Being listened to, even acknowledge, does not mean people or businesses change their actions.

For example, some smart number-crunchers can now almost empirically prove that hiring (poaching, cannibalising or whatever else you want to call it) bankers/clients from one firm to another is NOT a fool-proof strategy for growth in wealth management. In fact it has almost no correlation at all to growth in the mid to long-term. Indeed, rampant hiring tends to confuse businesses – and client’s perceptions – for all kinds of reasons.

However, in the last three months I have seen at least four major (and I mean major) wealth management players say they want to hire hundreds (yes, hundreds) of private bankers each for their Asian operations. There is a lot of wealth being made in Asia right now but I’m going to write something pretty obvious – the supply of private bankers just isn’t there. So, the strategy cannot work. To be overly reductionist it is the equivalent to designing a car that only runs on panda fur, or something else equally rare.

Now, the annoyance is that one of these panda-burning banks is a client. The same client who, the day before going on record with the press, stood in front of an ex-co and said rampant hiring would not help the business goals.

You can, I hope, understand my frustration when I read the papers.

So, now I have a new theory. CEOs feel compelled to make statements because other CEOs have made statements irrespective of their grounding in logic or reality. It’s almost like a game of schoolboy one-up-manship; the kind that can only end with people crying and blaming each other.

I’m going to let this go, accept it for what it is and start seeing how much the headhunters are going to make. However, I am also curious what the next round of CEO shenanigans will be…

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