Non-Resident Indian Wealth Management 2008

In recent years NRIs have come to be seen as an important niche segment for wealth managers to target and as a key potential growth area in the future. This brief assesses the strategies that wealth managers are using to target NRIs.
Report Highlights

The global stock of non-resident Indians (NRIs) continues to expand, with the highest concentrations in Saudi Arabia, the US, the UAE and the UK. Datamonitor research suggests that NRI clients based in Europe are more likely to insist on greater involvement in the management of their portfolios. In fact, 66% of European wealth managers described their NRI clients' desire to take an active role in their own portfolio management/investment decisions as above-average or high. Major wealth managers also perceive the value of targeting the NRI market by establishing private banking operations in their homeland. SG Private Banking's Singapore office serves as the base for its non-resident Indian (NRI) business line. However, the bank also leverages its on-the-ground presence in Bangalore, Chennai, Delhi and Mumbai.
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Overview 1
Catalyst 1
Summary 1
Methodology 1
Executive Summary 2
NRIs continue to offer solid business potential for wealth managers 2
The global NRI population is concentrated in the US, UK and the Middle East 2
Cultural traditions, demographics and location dictate the needs of NRIs 2
Competitive strategies attempt to marry the best of international and local expertise 2

Market Context 6
The global NRI population is concentrated in the US, UK and the Middle East 6
Saudi Arabia and the US have the biggest NRI populations, but the UAE is registering strong inflows 6
NRIs account for an estimated $500 billion of liquid assets 7
Recent and proposed legislation may increase interest in Singapore and Europe 7
Customers 9
Cultural traditions, demographics and location dictate the needs of NRIs 9
A strong sense of heritage and family stokes interest in Indian investment 9
An entrepreneurial community is also keen to access business banking and complementary services 9
Increasingly sophisticated NRIs are investing beyond their homeland 11
NRI investors are willing to take a long-term view 12
Mobile NRIs demand portability and flexibility 13
Quality of service and the wealth management relationship are paramount to NRIs 14
Location may influence expectations regarding service levels 14
NRI investors are driven by quality of service, access to a broad product range and complementary services 16
Competitive strategy 20
Competitive strategies attempt to marry the best of international and local expertise 20
Joint venture arrangements provide ready access to investment expertise and clients 20
Investor demand is driving new distribution agreements 21
Wealth managers are leveraging their onshore operations in India to build their NRI businesses 21
Subsidiaries also represent an option for market entry 21
Both mid-market and up-market strategies have their place 21
Competitor profiles 22
DSP Merrill Lynch leverages Merrill Lynch's global reach and offers online functionality 22
Société Générale builds client relationships through event sponsorship 23
ABN AMRO targets mass affluent NRIs with a comprehensive product/service portfolio and an NRI resource center 23
ICICI Bank offers a broad product range including specialist services for property investment 24
Axis Bank caters for NRIs and their families 24
Appendix 25
Data 25
Methodology 29
Further reading 29
Ask the analyst 30
Datamonitor consulting 30
Disclaimer 30
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Table 1: How would you rate NRI clients on their demand for tax advice, on average? 25
Table 2: How would you rate NRI clients on their demand for estate planning/trust services, on average? 25
Table 3: How would you rate NRI clients on their demand for strong international services such as offshore investments or overseas property investment/management, etc, on average? 26
Table 4: How would you rate NRI clients on their demand for online functionality from their wealth manager, on average? 26
Table 5: How would you rate NRI clients on their desire to take an active role in their own portfolio management/investment decisions, on average? 27
Table 6: How would you rate NRI clients on their demand for frequent communication/interaction with their wealth manager, on average? 27
Table 7: How would you rate the NRI client segment on its attractiveness as an area to focus on? 28
Table 8: For which of the following products is there "a lot of demand" from NRI clients? 28
Table 9: For which of the following services is there "a lot of demand" from NRI clients? 29


Figure 1: Stocks of NRIs by destination country, 2006 6
Figure 2: Flows of NRIs by destination country, 2006 7
Figure 3: How would you rate NRI clients on their demand for tax advice, on average? 10
Figure 4: How would you rate NRI clients on their demand for estate planning/trust services, on average? 11
Figure 5: How would you rate NRI clients on their demand for strong international services, such as offshore investments or overseas property investment/management, on average? 12
Figure 6: How would you rate NRI clients on their demand for online functionality from their wealth manager, on average? 14
Figure 7: How would you rate NRI clients on their desire to take an active role in their own portfolio management/investment decisions, on average? 15
Figure 8: How would you rate NRI clients on their demand for frequent communication/interaction with their wealth manager, on average? 16
Figure 9: How would you rate the NRI client segment on its attractiveness as an area to focus on? 17
Figure 10: For which of the following products is there "a lot of demand" from NRI clients? 18
Figure 11: For which of the following services is there "a lot of demand" from NRI clients? 19
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