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A new generation of wealthy players from the Indian subcontinent is attracting the attention of the world's biggest banks. Non-resident Indian wealth is rising and financial institutions are tripping over themselves to get a slice of the action.
Alykhan Lalani is rich, Indian and living in Dubai. He is the human face of the NRI - the three letters that private banks and wealth managers like to use to describe the phenomenon that is rocking the world of wealth management: Non-resident Indians.
Banks including Merrill Lynch, Coutts & Co and ABN Amro are running after accounts from high net worth clients like Lalani across the Gulf.
The former Merrill Lynch financier-turned-entrepreneur is amused at what he calls their "cookie-cutter'' approach to winning new accounts. "There are so many banks setting up here to look after the wealth of Indians who have made their money abroad," says Lalani. "A lot of NRI units have cropped up."
The NRI craze is encouraging international banks with offices in the Gulf to set up dedicated units to chase business from this fast expanding demographic.
"Often, you will find banks pushing the same products to many clients who actually have diverse needs," says Lalani.
"When dealing with a private banking institution, it is more about micromanaging it down to the personal relationship between the client and his financial advisor who understands his specific investment needs," he says.
ABN Amro is one of the banks that is investing heavily in attracting non-resident Indian clients within its wealth management business.
"It is a segment we simply cannot miss," says Shihad Niazi, head of ABN Amro's wealth management unit.
More than two-thirds of the bank's client base with a net worth of up to US$2m are non-resident Indians in the Gulf. And the number of non-resident Indian clients has surged to around 40% in the last year. ABN Amro has hired a similar amount of new staff to cope with the expanding Indian client base in the region.
"There has been a lot of wealth created in this particular client segment," Niazi explains. "They are very demanding now in terms of their financial needs and their requirements.
"That's why we decided to tap the NRI customers from our preferred banking platform. We can give them the pampering they want."
The latest Merrill Lynch World Wealth Report says that almost all international private banks, as well as many domestic ones, have identified the need for special banking products to cater to non-resident Indian wealth.
Gulf-based financial institutions have been increasingly gearing their services towards this niche market by providing dual currency deposits and rupee denominated products, attracting talented professionals to cover the NRI market, developing a broader Asian product platform and setting up management teams in the Asian subcontinent.
