The Journal this morning has a sort of funny article whose gist is basically that Asia’s new-money millionaires want actual performance from their private wealth managers and do unsporting things like split money among managers, demand products that offer impressive returns, and move money from managers who do a bad job to those who do a good job. You will not be surprised to learn that the bankers take kind of a dim view of this:

While clients in the West want to increase their wealth, they also are concerned with keeping what they have by sticking to conservative investments, and focusing on estate- and tax-planning strategies.

In Asia, clients also tend to be first generation rich, who want to make more money, rather than preserve it. They seek, as one banker said, “private brokers not private bankers.” …

“I have one client who now has more than 10 private bankers, saying he doesn’t want to depend on any one bank and risk his assets,” said Kenny Lam, McKinsey’s head of Asia private banking. “Asian clients are more interested in the next hot product rather than preserving wealth and are more likely to switch to the next banker with a better investment idea.”

Two and a half years ago the Journal ran what strikes me as a companion piece, about accumulators, which are an equity derivatives trade that banks sold mainly to Asian private-wealth clients and which revel in the nickname “I-kill-you-laters” because they do, and in 2008 they did. You can if you like connect the stories pretty effortlessly: Asian PWM clients demanded too-good-to-be-true returns, so banks happily obliged by selling them products with returns that were in fact too good to be true. And now they are demanding too-good-to-be-true returns and some banks are complaining because they can only offer mediocre-but-true returns, but others are probably just cooking up the next generation of delayed-death too-good-to-be-true products and not telling the Journal about it. Circle of life. Read more »