As the global brokerage industry shifts to zero fees for trading and robots to give advice, one company in Singapore is deciding to buck the trend.
UOB-Kay Hian Holdings has taken on a large group of securities trading representatives, known as remisiers, from a brokerage arm of the country’s largest bank. It’s essentially a bet customers will still pay extra to be hand-held in their trades.
“There is a lot of digitisation, but the human touch is still very important,” Esmond Choo, senior executive director at UOB-Kay Hian, said in an interview. People will be willing to pay “a few basis points” for the service, he said.
About 100 remisiers, who are paid on commission and aren’t full-time staff, have moved from DBS Vickers Securities (Singapore) Pte, according to Choo. That means UOB-Kay Hian, whose commission income fell 30 per cent in the six months ended June from a year earlier, now has 820 of the representatives in Singapore as well as a large network in other Asian markets, he said. “DBS’ decision offered a good opportunity to scale up,” Choo said. “It takes a lot of time to build a base of 100 remisiers.”
UOB-Kay Hian’s expansion comes as firms such as Charles Schwab Corp. and Fidelity Investments have eliminated fees on a range of offerings, and as robo-advisers are increasingly used to help clients to construct portfolios at a fraction of the cost of human advisers.