Entering the Standard Chartered Private Bank (SCPB) global headquarters in Singapore feels more like walking into a high-end restaurant than a financial institution's office. Diverse Asian touches lend an exotic, mysterious air, and the reception desk is not immediately apparent -- until the receptionist sweeps out from behind it. You can almost smell the waft of incense and hear the subtle strains of music.

"It's supposed to be like a home," explains Peter Flavel, global head of the private bank, adding that the unit's other Asian offices* are furnished along similar lines. Certainly, the regional motif stands out against the décor in other private banks visited by this correspondent (as a journalist rather than a client, I might add).

And a new approach is perhaps appropriate, given that SCPB is a relatively young entity. Three years ago, Flavel -- at the time Standard Chartered's global head of sales, marketing and distribution -- was asked to develop a global private bank for the group. Since its launch in mid-2007, SCPB has attained $35 billion in assets under management (AUM), helped by a merger with American Express's private banking business in 2007.

Standard Chartered's move into private banking was a response to existing client demand, says Flavel. Executives from its huge emerging-market corporate client base, along with retail customers seeking increased levels of service, were among those looking for additional wealth advisory services.

The firm currently has around 350 relationship managers and aims to add another 100 in the next 12 months, he says, adding that there's an AUM growth rate implicit within those figures. Flavel admits this will be a challenge, but is confident of sourcing existing Standard Chartered staff from other areas.

The bank has the advantage of having a large number of client-facing staff in other areas of the group who see the potential of the private banking career path, he says. "They already have relationships with the bank's clients, and we know them," adds Flavel. "I think we can only grow at that rate by leveraging this as a source of relationship managers."

He sees SCPB's growth being "primarily organic" and notes that within other groups, the private banking unit is often set up as separate monoline business, which can result in internal competition. "But we're designed so we complement the rest of [the group's] offering," says Flavel.

Asked about his view of whether he expects recent consolidation moves to continue as a trend, Flavel says more mergers are likely. He sees the market polarising between the largest firms -- "but you can't be too big, because at a certain size it's no longer private" -- and the boutique end of the spectrum. "Some will get caught in the middle and will find it quite difficult, in my view," he says.

Flavel sees big potential for expanding private banking as a business category, as there are a relatively small proportion of high-net-worth individuals (HNWIs) using private banking services to any great extent. "The opportunity of making private banking services relevant to them is huge," he says.

SCPB looks at two broad client groups, HNWIs with $1 million to $10 million in assets, which it aims to source from the group's retail bank network, and the 'key client group', comprising those with $25 million-plus in assets, whom Flavel expects to come from among the bank's existing corporate clients.

There are, however, challenges facing wealth managers -- not least increased caution and mistrust among existing and potential private bank clients, following losses on products such as accumulators and minibonds. The likely introduction of stronger financial regulations is another issue.

With regard to client caution, Flavel says risk appetite is now returning, and more quickly in Hong Kong, for example, than in Singapore. "Through the first quarter of this year, there was a definite move to cash, with people looking for the stability of Standard Chartered's balance sheet," he says. "As markets have risen, appetite has changed -- first clients have moved towards capital-guaranteed products, then more recently have been more comfortable investing directly in equities and simple, clear structures, commodities and real estate."

But there remain concerns over the speed of the rebound and to what extent it is sustainable, particularly once fiscal stimuli are withdrawn, says Flavel. When they are, will local domestic demand take their place? "That's a question we're all asking," he says.

As for the likelihood of tighter laws governing advice on and sale of investments, Flavel is broadly supportive. "Clients need to ensure they understand the products they are buying and what the risks are in that product or service, not just at the point of purchase, but in an ongoing sense," he says. "I think all client banks will implement client-review processes that are more formal and have a greater level of documentation in support of ongoing client interaction."

He adds the usual caveat that over-regulation would not be welcome: "One needs to be wary to the extent there is additional regulation, and hope that it is the right amount of additional regulation."

* These are Abu Dhabi, Bangalore, Beijing, Busan, Chennai, Delhi, Dubai, Hong Kong, Kolkata, Mumbai, Seoul, Shanghai and Taipei (the latter was set up in September).