With Rs 6.47 trillion ($77.2 billion) of assets under management, the wealth business is hiring retail bankers both within HDFC and externally, according to Rakesh K Singh, group head of investments, private wealth and international banking and digital ecosystems at India’s largest private lender.
“Retail bankers know the clients, they know how they behave,” Singh said in an interview. The bank has been expanding its wealth management team by 10% to 20% annually for the past few years, he said, but declined to comment on how many it plans to hire this year.
Read also: State Bank of India forms team of 2,000 bankers to woo wealthy clients
HDFC’s Mumbai-based wealth management business has about 800 relationship managers serving clients in about 100 cities and towns, including often-overlooked markets such as Jorhat in Assam and Salem in Tamil Nadu. However, further expansion may be limited not only because smaller cities lack enough high-net-worth individuals but also because they cannot source the right talent, he said.Read also: HSBC taps into the metaverse to win business from India’s wealthy diaspora
“We have learned that we don’t find people who can relate to a high-net-worth customer in the same market,” Singh said of smaller venues that might otherwise have a few wealthy customers. “A person should be able to connect with an HNI to build trust with them.”Read also: Wealthy Indians’ plan to invest abroad through new hub hits snag
India’s booming economy is creating fortunes at a remarkable pace, with the number of people with $30 million in assets expected to grow 50% between 2023 and 2028, according to a wealth report by Knight Frank. Coupled with a growing acceptance of professional wealth management, the growth is prompting banks such as HSBC Holdings Plc and Barclays Plc to devote more resources to capturing market share, creating a competitive hiring market.
Singh said the compensation offered to relationship managers is a cause for concern, with some being offered pay rises of more than 40% to 50% to switch employers. As more equity units are created and offer higher salaries to compete, the economy could suffer and some could fail, he said. “The cost of capital needs to be maintained,” Singh said. “My concern is that it will come back to haunt us.”
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