In approximate terms, how important is the EAM business line to the bank in general, for example for revenue growth, etc?
The EAM business is one of the strategic drivers for our private bank business and AUM growth. This segment has significant potential, and we intend to scale our EAM business by leveraging UOB’s regional capabilities and our wide product suite, including alternatives, discretionary portfolio management and wealth insights. We aim to have our EAM business contributing to a third of our asset under management growth in the next three years.

UOB Private Bank is anchored on Asian values focusing on trust and long-term relationships. This holds true across our business, including the EAM partners we work with. Our partnership with EAMs is one that involves understanding their needs and working closely with them to provide the right solutions for their clients. We are careful in our selection of EAM partners, working with those who share similar values and perspectives as us, and who work with us to better engage and serve our clients in the ASEAN region.

When dealing with EAMs, what are the main tasks and forms of support they ask for the most, and why, in your experience?
We usually support them by handling their clients’ investment needs and retail banking matters. These are unique services that we can offer to EAM clients, as we are backed by a full-suite consumer bank within the group.

We treat all clients, including our direct private bank clients and those through our EAM partners, equally. Our tri-party relationship with our EAM partners and their clients is very clear, with each party playing its own role. 

How important has the rise of VCCs (Variable Capital Companies) been in driving what EAMs do and the services they need?
VCCs are becoming quite popular with some EAMs. EAMs offer VCCs as it is a flexible, cost-efficient and tax-advantageous structure for managing multiple funds under a single entity. The ability to create multiple sub-funds with segregated assets and liabilities, along with investor flexibility, makes VCCs an attractive option for EAMs seeking operational efficiency and scalability.

In some jurisdictions, the favourable regulatory and tax frameworks surrounding VCCs can help EAMs optimise their fund management processes and attract a wide range of investors. On the other hand, some EAMs avoid VCCs due to the complexity and cost of setting them up, the learning curve involved, regulatory burdens and the preference for more familiar and simpler fund structures. There are also concerns about investor familiarity, liquidity management and the relative newness of VCCs, which may influence the decision to stick with traditional fund models that are already well understood and well established.

Regulatory requirements are important, and Singapore is of course no exception, along with Southeast Asia more generally. Are there topics that are particularly front of mind?
Regulatory requirements are part and parcel of the financial sector, to safeguard the interests of all stakeholders and uphold the integrity of the system. 

Hence, topics such as KYC, AML and data security are always areas that we look into closely, to ensure that we adhere to regulatory standards. Compliance costs have been rising across the industry and will continue to do so, as banks are expected to be more vigilant given the intensifying complexity of the environment and the interconnectivity across borders. Nonetheless, we are taking the increased compliance costs in our stride, as adherence to legal and regulatory requirements is part of our commitment as a trusted advisor to our clients and stakeholders.

How is digital technology shaping the sort of custody services you provide, for example affecting its cost, range of service, etc?
UOB Private Bank embarked on our transformation journey almost three years ago. Technology has greatly aided collating and organising the necessary information and data across various sources, to support our team in their engagement and advisory to our clients.

We are also working on using technology to enhance our digital banking capabilities for our clients and EAM partners. One of the areas we are looking at is real-time data access. It enables EAMs to make timely and informed decisions on investment strategies, while offering live tracking of asset positions, valuations and compliance monitoring for custody services.

Digital banking capabilities such as the ability to integrate EAM and bank systems via Application Programme Interfaces also allow for seamless and secured communication, easier portfolio management and more accurate reporting for partners and end clients.