The dual drivers of rapidly changing technology and customer needs are pushing financial institutions, including the private banks, to transform themselves in a digital era. This trend is particularly marked when it comes to the Asian market. In order to be more agile and competitive, private banks are using digital technologies, like advanced analytics and AI, to build modern IT infrastructures.

With its assets under management reaching US$403 billion as of end April 2018, Julius Baer, the Swiss private banking group, has recently implemented its digital transformation in business processes and core banking systems in its Asia Pacific region. This utilises the Temenos T24 core banking software platform and the Cognizant Banking and Financial Services Amplify solution provided by Cognizant, a US tech company.

"In the early days of our partnership with Julius Baer, the problem is around taking care of their basic technology issues," says Jayajyoti Sengupta, head of Asia Pacific at Cognizant. "During the past four or five years, Julius Baer started to get momentum in the private banking space in Asia. They invest very heavily into their Asia Pacific relationship management and other teams," he adds.

Nic Dreckmann, chief operating officer and member of the executive board at Julius Baer, comments: "Our shift to more digital engagements, coupled with increasing regulatory reporting obligations, is driving our biggest ever digital transformation program."

"We are witnessing a fundamental shift in how our customers prefer to engage with us and are deploying a business and technology infrastructure," says Dreckmann. "Cognizant was part of the team to successfully complete the entire implementation and get us onto a new digital core banking platform," he adds.

Conducted in one roll rather than in phases, the digital transformation is the largest in the private banking space. Cognizant helps Julius Baer to more quickly expand its range of wealth management products and services while improving operational agility.

Another major player in the private banking space, UBS, is also on their way to digital transformation. The Swiss bank hired Mike Dargon from Standard Chartered Bank in October 2016 as global head of technology, and set up a digital hub in Hong Kong in December last year. UBS has been investing hundreds of millions of Swiss francs in innovation. The bank is developing robots to improve the automated processes.

The market fears that the digital transformation might affect the headcount of the banks with AI taking over manual works. However, Sengupta cannot agree with this. "It will have a recalibration of jobs but will not cut jobs," says Sengupta.

Although there are certain jobs displaced by automated technology, digitalisation at the same time is generating new jobs, not only in tech companies but also in the financial institutions.

"Look at the number of the new skills that people have to acquire, and the number of digitally trained experts that we need. We are going to train millions of mid-level engineers and technologists. Not all of these experts are required by Cognizant – we are also training them for the investors because there is a severe shortage of such experts in the industry," says Sengupta.