Private banking architects: Tan Su Shan – leading the charge for Asia’s wealthy
Tan Su Shan has led DBS’s efforts to become the leading home-grown bank for wealth management in Asia, during a decade in which the number of billionaires in the region has soared.
When Singapore’s financial regulator, the Monetary Authority of Singapore (MAS), led the formation of the nation’s Private Banking Industry Group after the financial crisis, DBS’s Tan Su Shan was invited to co-chair it alongside them.
She well understood the importance of risk controls and conduct, having been no stranger to a crisis.
Tan’s career in finance began at Barings Securities at the end of the 1980s, working in institutional sales in London, Hong Kong and Tokyo, before Nick Leeson’s rogue trading in 1995 brought Barings Bank down. She returned to Singapore to join Morgan Stanley in wealth management shortly before the Asian crisis of 1998.
And after an eight-year stint as the region head for Singapore, Brunei and Malaysia at Citi Private Bank, she returned to Morgan Stanley in May 2008 four months before the global financial crisis began.
These were crucible moments, Tan says.
“During the Asian crisis, I was at a US bank and able to diversify our Asian clients into the burgeoning US and European markets that Asian investors were seeking. In the 2008 crisis, I found myself at a US bank when US investment banks were dropping like pins.”
She recalls queues forming outside US financial institutions as clients panicked and tried to withdraw their funds, as she spent the evening of her birthday, September 16, at the office with team mates.
“We were all clad in our pyjamas, helping our clients who were banking with us in US banks to move their funds out,” she says.
It wasn’t lost on her that during that period the lines forming outside DBS Bank were long queues of clients trying to move their funds in, she says.
“DBS was considered one of the safest banks.”
Less than two years later, she joined them to run their wealth management business. Then in 2013 she took on an expanded portfolio as group head of consumer banking and wealth management.
“I no longer take any financial Institution’s safety for granted, and boy am I happy to be on the right side of that bank queue now,” she says.
The immediate years after the 2008 financial crisis were a turning point for wealth management in the region. It had the effect of moving the vast sums of Asian wealth that had been accumulating out of the European and US banks and into Singaporean and Asian banks. But, given that it was a relatively new industry locally, few had the expertise of their international peers. The Asian banks were chiefly retail or corporate banks serving high net-worth clients.
Tan changed that profile by turning DBS into a top-five name in regional private banking, where before only the Swiss and US banks had been.
She understood that clients in Asia needed corporate banking and capital markets, product platforms and wealth structuring solutions. She understood the role technology would play in attracting clients and serving them (even learning coding herself), as well as the importance of a high-touch service.
She also knew that to become regional required scale. As regulatory costs rose in the post-crisis world, so too did consolidation opportunities. Under Tan, DBS acquired Société Générale and ANZ’s wealth businesses in the region in 2014 and 2016 respectively, helping to take DBS’s wealth management income from S$506 million ($372 million) to over S$2.5 billion today.
Tan has been integral to the professionalization of the Asian wealth management industry. She is one of the most-recognized bankers in Singapore, having been a nominated member of parliament. Her philanthropic work both in and out of DBS and her founding of The Financial Women’s Association in Singapore have added to that visibility.
I believe life is far more fulfilling when you’ve made an impact, be it in work or your personal life - Tan Su Shan
Her work with MAS and other industry leaders in developing the blueprint for competency benchmarks and acceptable code of conduct standards has helped the wealth management industry in Singapore gain a reputation for being safe and professional, setting a standard alongside Hong Kong for other countries to follow.
It has been a journey, she says, from an industry that started off fairly innocuously in the early 1990s leveraging the existing institutional platforms of US investment banks or the retail platforms of universal banks to where it is today.
“The rise of China, Indonesia and the global Indian diaspora in the 2000s meant incumbent players scaled up to become multi-billion dollar businesses, while many new players scrambled to join the party, driving the hiring spurt to a peak in 2006/07,” she says.
At the same time leveraged structured products took off – with many not understanding the risks involved.
“It took the 2008 crisis to clean out some of these excesses and for new regulations to come into play, especially around sales suitability and AML/KYC [anti-money laundering/know your customer].”
What has been the best part of seeing the evolution of the region’s wealth management industry?
“The rising sophistication of both the clients and the private bankers in Asia. Asia has gone from being a follower to a leader,” she says.
As she moves out of wealth management into running the institutional group, Tan says what has been most rewarding is cultivating younger talent.
“Winston Churchill once said: ‘You make a living by what you get, but you make a life by what you give’ – which really resonates with me, as I believe life is far more fulfilling when you’ve made an impact, be it in work or your personal life,” she says. “I fondly recall many young bankers who started out at our retail bank, then progressed on to our priority bank and then our private bank.
“Many grew their careers within DBS, moving up the wealth continuum alongside their clients. This creates a longevity, a culture and a camaraderie that money can’t buy.”