StanChart to hire 850 for priority banking

SINGAPORE (Reuters) - Standard Chartered (STAN.L) (2888.HK) plans to hire about 850 bankers over the next 12-18 months for its 'priority banking' arm that focuses on the mid-tier wealth segment, taking on Citigroup and HSBC in the quest for more affluent customers.

StanChart, which has emerged relatively unscathed from the global financial crisis, has been hiring staff from rivals to grow its Asian operations at a time when many competitors are distracted by problems in their home markets.

"Priority has outperformed the market in the last few years," StanChart's Singapore-based Global Head of Premium Banking Foo Mee Har told Reuters in an interview on Tuesday.

"We have aspirations to double the industry growth rate and double our customer numbers in three years."

Foo said household wealth in Asia excluding Japan is expected to grow by 12 percent per annum between 2008 and 2012, and Asia-focused StanChart hoped to expand its priority banking business at twice the pace.

She said about 430 of the new relationship-manager hires will be in Greater China, while about 120 will be in Singapore and about 110 in Malaysia.

The new hires, who Foo said will typically have some banking experience, will boost the bank's number of priority banking relationship managers by 65 percent from around 1,300 now.

StanChart has already relaunched its priority banking service in Hong Kong and Singapore. It will launch the service in China this week, and in Taiwan, Korea, Malaysia, India and the United Arab Emirates over the coming months.

Priority banking services are aimed at owners of small and medium enterprises as well as senior executives who typically can invest assets of more than $100,000 with the bank.

The services for such clients include access to personal relationship managers, separate queues at bank branches, preferential loan rates and help in setting up new accounts in different countries.

"A lot of banks are more distracted from what is happening in the U.S. or UK, Standard Chartered is not," said Daniel Tabbush, a CLSA banking analyst based in Bangkok.

"There are lots of wealthy people in Asia who want the better service than normal retail banks but there are not a lot of banks in Asia which offer this," he added.

Many lenders in Asia provide special perks to wealthier customers but only a handful have the ability to service this customer segment on an Asia-wide basis. The more aggressive players in this area include Citigroup (C.N), HSBC (HSBA.L) and Singapore's DBS Group (DBSM.SI).

UK-based StanChart, which derives two-thirds of its revenue from Asia, is also currently in talks to buy India and China assets from Royal Bank of Scotland (RBS.L).

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Foo, a yoga enthusiast who was previously CEO of Standard Chartered Thailand, said the British bank has benefited from the financial crisis and was attracting new deposits amid a "flight to quality" as customers shifted savings to stronger lenders.

While the sale of investment products had fallen over the past year, Standard Chartered's priority banking service has benefited from a growth in mortgage loans.

"We have been able to capture increased market share in the mortgage area where we have seen, in the first half, strong property transactions in Hong Kong, Singapore and Korea."

The bank estimates its share of new mortgages in Hong Kong at 19 percent currently, up from 13 percent last year. In Singapore, its share of new home loans has grown to 22 percent.

Foo declined to reveal the number of customers at StanChart for priority banking, which the bank has identified as a key area.

"There is more and more pressure for people working in the consumer division to try to get better performance," CLSA's Tabbush said. "The consumer division is under such a spotlight because it lagged the wholesale division so much."

Standard Chartered last week reported a 10 percent rise in pretax profit for the six months to June, but the consumer banking operation chalked up lower earnings.

(Editing by Neil Chatterjee and Muralikumar Anantharaman)