[Interview] "What a 10 Billion Won Asset VVIP Client Wants Is 'Differentiated Service'"

Jeong Taeksu, Head of WM Consulting Center at Shinhan Bank

28th, inside Shinhan PWM Family Office Seoul Center, Jung-gu, Seoul. / Photo by Jinhyung Kang aymsdream@

[Asia Economy Reporter Yu Je-hoon] "What ultra-high-net-worth clients want is 'differentiated services tailored only for me,' not the conventional uniform services."

On the 2nd, Jung Taek-soo, head of Shinhan Bank's WM Consulting Center, explained in an interview with this publication the reason for launching Shinhan PWM Family Office Center (SFC). The WM Consulting Center, led by Jung, is a dedicated organization supporting the operation of SFC, which targets clients with financial assets exceeding 10 billion KRW.

Jung said, "SFC tends to have many traditional wealthy clients who are older, and for them, 'asset transfer' is also a very important theme. Issues like tax administration or gift tax rates are not that significant to them. For example, if the client is an entrepreneur, a comprehensive strategy is needed on how to pass the business on to the next generation and how to manage shareholding ratios," he explained.

Below is a Q&A with Head Jung.

- What kind of clients typically have financial assets over 10 billion KRW, and what are their main concerns?

▲ There are traditional wealthy clients such as members of large conglomerate families or owners of medium and small enterprises, and recently, the number of young & rich who have succeeded in startups or received large stock options has significantly increased. For traditional wealthy clients, in addition to stable asset growth, asset transfer is a very important theme. Young & rich clients tend to want proposals for discovering various investment opportunities.

- What are the investment tendencies of ultra-high-net-worth clients?

▲ There are clear differences depending on the individual. For example, some clients who prefer safe assets may lock 8 billion KRW out of their 10 billion KRW financial assets in fixed deposits and invest the remaining 2 billion KRW only in stable bonds. On the other hand, some young & rich clients request to be included in IPOs, private equity funds, and even club deals involving institutional investors. The common point is that they no longer focus on just one investment product.

- What distinguishes SFC from other financial companies' asset management services for high-net-worth clients?

▲ Other companies also operate family office services for clients with financial assets over 10 billion KRW, but most remain at the 'service' level. In contrast, Shinhan Financial Group has established a middle organization, the WM Consulting Center, and a dedicated family office team at headquarters, and has branded asset management services for ultra-high-net-worth clients as an independent brand.

- Competition in the VIP asset management market among financial institutions is fierce.

▲ That's right. Even among ultra-high-net-worth clients, many switch to other companies due to dissatisfaction with results or better relationships with other financial firms despite initially being satisfied with presentations. For example, one client started dealing with a certain financial company last year through a referral but contacted us when the results were disappointing. Whether in process or outcome, even if a financial company makes a mistake at some point, the market offers no shortage of alternatives for these clients.

- Young & rich clients might prefer AI-driven investments over direct consultation services, right?

▲ According to a recent report by global investment bank UBS, asset management services at advanced financial companies are moving along two tracks: 'hyper-personalization' and 'digitalization.' Shinhan Financial Group has launched SFC and recently introduced AI-based asset management services such as 'My AI Solution.' Among these, Shinhan SOL PB is a service for general high-net-worth clients. Family office clients can receive both direct close management and make investments directly through platforms.

- What are the features of the SFC concierge service?

▲ Traditional financial sector concierge services allowed clients to choose from predefined services, such as receiving hotel accommodation vouchers. However, we have a dedicated concierge team within the family office team that directly discovers and connects clients' needs across leisure, lifestyle, and various other aspects.

- Can you give examples of non-financial services?

▲ For example, if a client requests to stay at a specific hotel in Singapore and dine at the most famous local dim sum restaurant, SFC checks the feasibility and contacts various vendors to develop a route. Ultimately, we aim to discover and provide what clients want and need directly. It is a much higher quality service compared to existing ones.

This content was produced with the assistance of AI translation services.