KBank’s wealth planning service targets high net worth families

The family wealth-planning service is another step for KBank’s private banking, partnering Lombard Odier since late 2014.
Head of the Private Banking Business Division Jirawat Supornpaibul said the bank, the country’s fourth largest, entered the wealth management business in 2008, and from 2008-12 it focused on privilege banking. It has since expanded to capital-market investment advisory services and HNWs in 2013-14.
The family wealth-planning service is the last jigsaw to fulfil the international comprehensive wealth management, he said.
Without Lombard Odier, which has 220 years of experience and seven generations managing clients’ and partners’ wealth, we cannot offer family wealth-planning service, he added.
He said the bank attaches importance to family continuity planning because most private-banking clients are from the family business. He cited the example of the SET100, of which 80 are family-owned businesses.
Worldwide, family business is the key engine in driving the economy but the problem family businesses face is continuity because 3 per cent of all family businesses are operated by the fourth-generation. Disputes in family businesses arise from family members more than external factors.
Regarding the second deliverable, financial asset, liability and risk management, KBank acknowledges that taxation and inflation have increased expenses for family businesses, while returns on investment in the capital market have fluctuated.
The inheritance tax, and property and building tax are enhancing wealth reallocation among family businesses. Therefore, planning services or the asset-holding structure, and inheritance and wealth transfer are the focus of KBank as well, he said.
The bank targets the top 50 family business HNWs. It has started to offer continuity planning, financial, liability and risk management, asset holding structure and succession planning to 4-5 family business HNWs.
“We will offer services for philanthropy and family offices in the next stage. We have to educate them on the importance of philanthropy, as this is one of the tools to sustain the reputation of a wealthy family,” he said.
Seema Bhayat, Lombard Odier’s head of Wealth Planning, Asia Pacific, said family HNWs present 60-80 per cent of global gross domestic product, and in Thailand, the bank sees diversification in the family business. Thailand is a very exciting market for Lombard Odier as it has seen an increase in young families who are able to build their wealth as the first generation.
At present, KBank’s private banking has total assets under management of Bt760 billion from 9,600 HNWs. In Thailand, there are a total of 23,000 HNWs, of which 80 per cent are HNWs in Bangkok and 20 per cent in the provinces.
The bank projects 9,800 HNWs this year and assets under management will rise to Bt800 billion.