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HSBC and UBS are expanding their wealth management arms in India to compete with local rivals after a listings boom minted a new class of millionaires.

The Swiss bank is looking to acquire shares in one of India’s largest wealth management companies 360 ONE, said two people familiar with the matter, while HSBC announced in January it would nearly double its branches in India with a focus on “cities identified for their growing wealth pools”.

A record year of initial public offerings in 2024 created a new crop of rich Indians, prompting big banks to start offering bespoke services and cater to wealthy households outside the large metropolitan areas.

Wealth under management is expected to triple to more than $850bn in the next five years, according to broker and asset manager Motilal Oswal Financial Services. Property consultancy Knight Frank estimates the number of people in India with more than $30mn will rise by half to nearly 20,000 in the five years to 2028, the fastest pace globally and higher than the 28 per cent worldwide average.

“There has been remarkable wealth creation that’s taken place across all the client segments . . . linked to the way India is growing,” said Rajesh Saluja, chief executive of Blackstone-backed ASK Private Wealth in Mumbai, which serves about 3,500 wealthy Indian families.

He added that the wealth management industry had “serious tailwinds” as start-up founders exercised their stock options.

Yatin Shah, co-founder of publicly listed 360 ONE, declined to comment on whether his company was in talks with UBS, but told the Financial Times that a “lot of other good reputable franchises reach out to us, that they look at India for next 10 to 20 years as a very attractive destination outside the US”.

UBS did not respond to a request for comment.

Global banks view their advantage as serving clients in the Indian diaspora and those interested in overseas investments. Sandeep Batra, HSBC India’s international wealth head, said in January that the bank was “aiming to be the preferred international bank for India’s affluent and globally mobile Indians”.

However, Gautami Gavankar, one of the heads of Kotak Mahindra Bank’s wealth management business, told the FT that India would remain a top investment destination for clients, especially since rules only allow Indians to invest up to $250,000 outside the country.

Kotak’s wealth management clientele has grown almost 15 per cent annually for the past four years, said Gavankar, while the number has doubled in so-called second- and third-tier cities in the past two years.

Demand for multifamily offices is growing across the country, added Gavankar, who expects competition to intensify as activity picks up in India’s equity market over the next decade. 

Akash Hariani, co-managing director of Motilal Oswal’s wealth management business, said he took seven to eight flights a week to meet clients, demonstrating the “kind of money creation that’s happening across the country”.

“It’s unbelievable,” he said. “There is so much activity that you will feel bad for not being there.”