Thailand’s Thriving Wealth Management Sector

125

Thailand’s wealth management industry has experienced significant growth alongside the country’s economic development. With Thailand transitioning to an upper-middle income economy in 2011, the accumulation of household wealth has been notable. Over the past four decades, Thailand has transformed from a low-income country to its current status, marking a remarkable journey in social and economic advancement.

The trajectory of household wealth in Thailand mirrors its economic growth. According to the Credit Suisse Research Institute, Thailand’s household wealth surged by 6.9% in 2017, reaching USD 434 billion. Over the long term, since 2000, household wealth has seen an annual growth rate of 8.9%. Notably, growth is most rapid among the top wealth segments, driving private asset flows and investment trends. The number of high net-worth individuals (HNWIs) with over USD 1 million in investable assets saw substantial growth, as did the number of ultra HNWIs with over USD 50 million.

Thailand’s wealth management sector has flourished amid this expanding wealth landscape. Regulatory changes and central bank policies, particularly in managing the strong baht, have propelled the industry’s growth. The relaxation of exchange control regulations since 2007 has allowed Thai residents to invest abroad, diversifying investment opportunities.

Although Thailand’s wealth management industry is still emerging compared to more mature markets, there has been a proliferation of local and international financial institutions offering diverse investment instruments and wealth management products. Asset management companies have doubled over the past two decades, managing an array of funds across asset classes.

Private banking services, initially introduced among local financial institutions, have evolved to cater to a broad spectrum of clientele, from the mass affluent to HNWIs. However, the needs and sophistication of investors vary significantly across wealth segments, necessitating tailored services and solutions.

Global banks with established private banking traditions dominate the Asian market. Credit Suisse, for instance, launched wealth management services in Thailand in 2016, targeting HNWIs and ultra-HNWIs with sophisticated investment needs.

The evolution of Thailand’s wealth management industry underscores the importance of an advisory approach focused on holistic client needs, objectives, and investment profiles. Educating clients on a balanced investment approach, diversification across asset classes, and navigating market volatility are key priorities for industry players as they navigate Thailand’s evolving wealth landscape.