LGT Group CEO Prinz Max von Liechtenstein. Copyright: Brigitt & Eddy Risch.
LGT Group, the world’s largest family-owned private bank and asset manager, is open to more inorganic opportunities in India to expand its footprint.
The Liechtenstein-based private banker, which has global assets under management of more than $ 300 billion, has forayed into India’s burgeoning private banking and wealth management sector with incorporation of LGT Wealth India.
In an interview with Moneycontrol, LGT Group Chairman H.S.H Prince Max von und zu Liechtenstein, said that the India private banking and wealth management business has a lot of potential to grow organically.
“…but we are open to any interesting inorganic opportunities to expand our business,” Prince Max said.
Prince Max said that LGT Wealth India will aim at becoming a top-tier, full-service platform for high net worth individuals (HNI) and ultra-high net worth individuals. “In the next five years, our aim is to be among the top three private client businesses in the country,” Prince Max said.
Prince Max also highlighted the growing appetite among HNI and ultra HNI clients for private equity investments in India. “We do see demand increasing from HNI/UHNI investors to allocate part of their assets to this asset class,” the LGT Group chair said.
Edited excerpts:
What attracted you to India, to launch a wealth management business here?
India is a large and high-growth economy. This is resulting in a dramatic increase in wealth across the spectrum. However, access to good-quality financial advice for families is still difficult. The needs of HNI/UHNI families are also getting complex, and they are looking for a stable, global partner for investment solutions, wealth planning, succession or philanthropy. We are excited to combine that knowledge and experience with a vibrant domestic India platform and offer the same quality service to Indian families.
What are your ambitions for LGT Wealth and how much will LGT be investing in its India operations?
LGT Wealth India is aiming to be a top-tier, full-service platform for HNI and UHNI clients in India. We already have a very experienced management team in India, led by Atul Singh, a veteran in the private banking industry. The team has built a strong private client platform, with 200 senior employees and a marquee client base. Apart from serving families domestically, we are focused on helping them globalise and build a diversified exposure to the world. In the next 5 years, our aim is to be in the top 3 private client businesses in the country.
Wealth management is still a very new concept in India. What are the challenges you foresee for yourself and what are the opportunities?
The India wealth management demand side is attractive. It is a growing economy, with rapidly increasing wealth, and largely underpenetrated in terms of financial advice. We strongly feel that there is a gap in services rendered to clients and there is a white space for a global-local approach to serving clients. We would like to bring the best of our global practices platform here while keeping the agility that the Indian market needs at this stage.
Would you be looking at acquisitions to expand your footprint in the Indian market or will it be an organic process?
Given the growth drivers, there is a lot of potential to grow organically, but we are open to any interesting inorganic opportunities to expand our business.
What kind of investments are your clients are talking the most about?
Clients are more interested in holistic platforms and solutions for wealth management. Investment products will remain the same but easy access, investment discipline and transparency are more important. Having said that, there is new interest from Indian clients for private equity investments and offshore investments. We are very pleased to cater to all the needs of Indian clients.
The private equity space has seen a sharp influx of HNI and Ultra HNI investments in the past five years. Do you expect more and more client demands to participate in the startup space?
Private equity has seen strong interest as entrepreneurs in India are creating new, disruptive business models creating substantial value. The government has also been entrepreneur-friendly, which should keep interest in the space ongoing. We do see demand increasing from HNI/UHNI investors to allocate part of their assets to this asset class.
Why is sustainable investment drawing so much interest from HNIs and UHNIs?
In our view, traditional financial analysis delivers the best results when supplemented with insights from sustainability research. While the topic of sustainability has already become mainstream in the institutional sector, private clients still make sustainable investments to a lesser extent. We have a special focus on the sustainability of our investments and also support our customers in investing sustainably.
(This interview has been edited for length and clarity.)
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