As Singapore strives to topple Switzerland’s top place in being a private banking hub, a lawyer has warned the risks of the city-state being too overbanked, writes Caroline Ng.
Nisha Singh, senior associate for Singapore private clients at global law firm Berwin Leighton Paisner, exclusively told Private Banker International that clients, typically the swelling ranks of millionaires, are increasingly choosing to have multiple banking relationships in the aftermath of the financial crisis.
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She warned: "They tend to be banking with a number of institutions and it can be overbanked. As a result there is nobody who has the full picture because the private banker at one bank may be selling assets, while the other may be buying back the same thing."
"You have these types of inefficiencies creeping in," she added.
While the sheer volume of banks reflects a competitive environment for consumers, its saturation could also lead to some institutions not having enough business to support their overhead, resulting in less efficiency.
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