Questioning of UBS financier in China rattles private banking

Asia’s fast-growing private banking sector has been shaken by the news that a UBS banker visiting China has been told by the authorities not to leave the country, casting a shadow over the opportunity presented by China’s large and expanding pool of billionaires.

The Singapore-based banker, who had travelled to Beijing to meet clients, has been asked to answer questions regarding an unspecified matter, spurring a warning from UBS to its private banking staff to delay travel to China.

Neither the Swiss bank nor the Chinese government gave details of the questioning, but Beijing has been mounting fierce campaigns to restrict capital flight, curb corruption and tackle tax evasion by its citizens.

UBS, one of a few global banks running an onshore wealth management business in China, has since rescinded its travel warning. “The situation has happened in the past to other institutions; we took temporary measures [on travel] to see what was going on, and within 24 hours lifted the ban. Now we know the situation was nothing to do with the bank or with her,” said Sergio Ermotti, chief executive, on Thursday.