TO attract the 'new rich' with a wider suite of priority banking services, DBS Bank is making more sophisticated products and services available to its priority banking customers.
This involves tailor-making products that previously belonged to the private banking segment to customers who do not use private banking services but have sophisticated needs.
DBS managing director and head of Treasures Priority Banking Pearlyn Phau says the space between mass market customers and the mass affluent is growing at a brisk pace of 6 per cent each year. This 'sandwich' group has assets between $200,000 and $1 million. 'This is a very competitive space that is 25 times more profitable than mass market customers,' Ms Phau said during a lunch session. 'This 'affluent' segment is an area we hope to have a strong foothold in.'
DBS offers Treasures Priority Banking to selected customers who have at least $200,000 of assets under management with the bank, including deposits and investments. It currently has about a 25 per cent share of this market and is keen to expand this by differentiating its products and services.
Ms Phau says that to provide services that cater to clients 'from cradle to retirement', the bank tries to anticipate their needs, and if these happen to fall in the private banking space, it will consider making products or services available by lowering the entry barrier or minimum criteria.
In this way, these customers can participate in markets previously not available to them and diversify their asset classes. In other words, they can 'gain a larger exposure with a smaller outlay', Ms Phau said. 'For the past six months, we have been evaluating private banking products to make them available for priority banking customers.'
For instance, DBS introduced fiduciary services, which were previously available to private banking customers, to priority banking customers two months ago, as it sees an increasing need for them to preserve and transfer wealth according to their wishes. To complement its suite of products, DBS also introduced Spectrum, a three-year principal-protected product that allows clients to participate in the upside of the Malaysian ringgit with a minimum deposit of $25,000.
