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  • Digitalization of Asian Private Banking in Numbers

    Digitalization of Asian Private Banking in Numbers

    Even private banking in Asia – awash with not only the usual posh amenities but also various other characteristics that make it uniquely more high-touch – was not immune digital disruption during the pandemic.

    Within the banking sector, private banking has often been named as one of the segments most immune to digital disruption due to several common factors: larger account sizes and transaction sums that justify human resource costs; complex products and sensitive issues that are difficult to discuss while not in-person; and an older and traditionally less tech-savvy client demographic.

    This is even more amplified in Asia due to a hands-on investor culture coupled with a high share of active trading, leading to more need for manual interaction with clients. But increased market volatility and unprecedented geopolitical uncertainty, amidst an ongoing pandemic, has created an impetus for engagement regardless of method.

    We have met all our clients in their living room over the last six months, which was the first time ever, said Lombard Odier’s Asia chief executive, Vincent Magnenat, in a recent online conference. And guess what? We could have done this before Covid. We needed something like Covid to realize that we don’t need to take a flight to engage with our clients and partners.

    Many of the digital tools and capabilities being showcased during the pandemic, such as secure instant messaging or interactive virtual events, were already available to clients before the outbreak. But against the backdrop of restricted physical access, greater uncertainty and a digital option, a new factor has emerged: self-motivation.

    In the past if you wanted to share your view on macro or on markets, you basically had two ways: set up a large client event or distribute research documents and have bankers follow-up, said Omar Shokur, Asia chief executive of Indosuez Wealth Management in a previous interview. But during this crisis, we have seen bankers and clients becoming more receptive to interaction through new channels like virtual events, not to mention a much faster time to market.

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  • Net New Money Surges at DBS Private Bank

    Net New Money Surges at DBS Private Bank

    DBS’s private banking arm saw net new money inflows surge in the first half of 2020 driven by a diversified range of client segments.

    Net new money inflows surged by 170 percent in the first half for DBS Private Bank which saw assets under management (AUM) climb 9 percent in the same period, according to a report.

    Our business has really gone up to higher than pre-Covid times, said Joseph Poon, group head of the private bank, noting that it was on course to register 7-8 percent AUM growth this year. The rebound has been very strong. We hope we’ll see this growth maintained all the way to the end of the year.

    Although DBS does not break down absolute figures, its private banking business is part of its broader wealth management unit which saw AUMs rise 7 percent year-on-year to S$251 billion ($184 billion).

    The bank has benefited from its traditional markets in the ASEAN or Greater China region and is eyeing further expansion specifically in the Philippines and Thailand where wealthy families are keen on diversification. In the latter market, Poon noted that the bank was on track to double AUM to reach $5.86 billion by 2023.

    Outside of Asia, DBS Private Bank also saw inflows from western markets, especially from family offices looking to establish a presence in Singapore.

    European and U.S. family offices see Singapore as a lighthouse from which they can see the rest of Asia, whether for financial market investments or actual businesses they may want to invest in or partner with, Poon said.

    On investments, the bank is currently advising clients take a barbell approach to focus on growth and income. The «DBS CIO Barbell Portfolio» strategy covers over 50 securities and the bank is also offering a structured note tracking its performance which has delivered net returns of 11 percent, outperforming its benchmark by around 6 percent.

    Also gaining traction at DBS is sustainable investing where the bank has adopted MSCI ESG ratings for the portfolios of its wealth management clients. The bank also created a structured product to provide exposure to the theme and the ESG MSCI Asia Outperformance Note has generated an average alpha of 12.2 percent since its inception in 2018.

    And should Asian investors seek to add exposure to such themes, ample cash holdings await them as DBS saw clients boost allocations to 40 percent during the crisis, up from the traditional 30 percent allocation.

    According to Poon, clients are increasingly cash allocations not only in anticipation of distressed asset opportunities but also to boost liquidity in case of urgent business needs, especially given the high share of entrepreneurs amongst the region’s high net worth individuals.

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  • How to Trade Online

    How to Trade Online

    Learn to Trade Online- It’s an Intricate Affair

    Trading online may not be as easy as you think. Also, it is riskier than many perceive it to be, especially if you are involved in guess work, and haven’t done your homework. Many of us have capitalized on online money making opportunities, leaving no stone unturned. For those who are net savvy or perhaps just more entrepreneurial, taking a step into trading online requires sound trading skills. You may be privy to some of this information, or be using a renowned company for the same. Either way, it is not a trade for the weak at heart as there will be grave losses without informed decisions.

    Take Courses on Online Trading 

    Before we get to the nitty-gritty on how to trade online and go about perfecting this art (if at all that’s possible), let’s examine the options available to you

    Foreign Exchange Trading

    This is the first type of trading amateurs look at to make a buck. If you are not familiar with online trading at all, this may be the perfect starting point for you. It involves buying and selling popularly used and traded currencies. Making a profit is easy once you learn when to buy and/or sell

    Trading in Shares

    This is what you ordinarily come across when you catch a glimpse of NYSE or NASDAQ on CNN. It is buying and selling of company shares and usually attracts the richest investors. Take ample time to learn this trade prior to considering putting any money in

    Traders Buy and Sell Shares on the Stock Exchange

    Binaries

    Are you a gambler by any chance?  Ever placed an all-or-nothing bet? It’s basically going all out and expecting to either win, or end up broke. Based on predictions of how a certain event will pan-out, it is quite simple and only requires some insight, or instincts regarding an event.

    How Can One Prepare for Online Trading?

    Financial (market) literacy

    For starters, you will not be gambling a few pennies to the dollar, nor will you be gauging weak odds for marginal profit-making. This form of trading revolves around buying and selling financial securities. That being the case, you need to invest A LOT into learning about commodities, equities and currency indices. You may need to read on more than you planned to- it is essential because trading transcends different market sectors and may require knowledge from your college diploma. Read literature on how to win on Wall Street, analyzing financial markets, and of course, how trading online can help you earn a living. 

    Many of these learnings can be achieved for pennies on the dollar (unlike trading online). You should make use of online shows and television programs oriented toward financial markets. Yahoo Finance, CBS Market Watch and the like all cater for novice, as well as professional traders. For those seeking top notch insight from the comfort of their living rooms, Bloomberg and The Wall Street Journal will not disappoint.

     Market Literacy is Important

    Seminars on Trading

    Find professionals, no matter how much they cost, to guide you along the way. Most people (unfortunately) take their first trading steps with money allotted for something else. This, by the way, is not recommended nor endorsed by any of us. However, seeing as we have no control over which funds are spent for this endeavor, we can only recommend that you find specialists in the same. Also, while in the process of attending seminars, it would be beneficial to find a mentor- specifically, someone who has worlds of experience trading. They should also be trading in the field YOU want to participate in, otherwise their insight may be superficial.

    Practice makes perfect

    There are online games that get you heading in the right direction. These simulations may allow you to play with a little bit of cash, which is a great way to ensure you are not spending thriftily and losing embarrassingly. This paper trading removes the psychological effect of losing money. Once you move on to trading with your own cash, the emotions will kick in, but it helps a great deal if you have some foresight as to what may/ may not happen.

    To finalize your lessons and find your footing in the trading world, use credible and renowned firms to engage with. Forums can help you find the right ones, or if you have a mentor, they will undoubtedly link to one- or two worth checking out. If you are up for it, and your trading game is witnessing growth, take on a diverse portfolio. The more options you have to trade with, the more you can spread your risk and reduce your losses. 

     

     

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  • DBS to Form Securities Joint Venture in China

    DBS to Form Securities Joint Venture in China

    The firm joins a string of international banks that have registered with Chinese authorities to set up onshore brokerages after the financial market supervisor loosened the rules on foreign access to financial markets.

    DBS Bank has received approval to establish a securities brokerage joint venture in China, which will provide brokerage, securities investment consulting, securities underwriting and sponsorship, as well as proprietary trading, the bank announced on Wednesday in a statement.

    The bank had been in discussions to set up a securities firm in China together with a local partner as far back as 2018.

    DBS Securities (China) will be 51 percent owned by DBS Bank, 24.67 percent by Donghao Lansheng Investment Management, 13.33 percent by Shanghai Huangpu Investment Holdings, 6.5 percent by Shanghai Huiyang Asset Management, and 4.5 percent by Shanghai Huangpu Guidance Fund Equity Investment.

    DBS chief executive Piyush Gupta called it a key milestone for the bank, and said it would «make available the best of DBS’ capabilities and offerings, and provide customers in China with a full range of onshore and offshore financial services.»

    The establishment of DBS Securities will further support the long-term sustainable development of DBS Group in China and meet the changing needs of customers in multiple aspects, Neil Ge, China head of DBS Group said.

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  • Citi Names APAC Trade Head

    Citi Names APAC Trade Head

    Citi’s treasury and trade solutions unit promotes its former head of trade finance for Asia Pacific to lead the region’s trade unit. Citi Treasury and Trade Solutions (TTS) appoints Kanika Thakur as its Asia Pacific trade head, effective immediately, according to a statement. Thakur succeeds Vishal Kapoor was named head of TTS for Citi Hong Kong in May this year.

    In her Hong Kong-based role, Thakur reports to Rajesh Mehta, APAC TTS head and Ebru Pakcan, global head of trade.

    A career Citi banker, Thakur joined in 2001 as a management associate in India. Since then, she has also worked in Hong Kong and Singapore within trade across roles such as sales and structuring, product management, and distribution. Prior to her latest appointment, Thakur was the APAC head of trade finance.

    According to the statement, Thakur takes on the role amidst a «new operating environment» of evolving needs such as «shifts in trade flows, reconfiguration of supply chains and [the] advent of new technologies».

    In addition to maintaining our market leadership [in the trade business, Thakur] will also be responsible for charting the course of our future business model in a rapidly changing environment, said Mehta.

    Citi’s trade business generated high single-digit growth in 2019 and has also seen an uptick in activity this year amidst an economically challenging environment, the statement added.

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  • Deutsche Bank Names Vietnam Country Chief

    Deutsche Bank Names Vietnam Country Chief

    He joins from Maritime Bank, a Vietnamese bank where he was CEO for four years before taking up its deputy chairman position earlier this year.

    Deutsche Bank has appointed seasoned banker Huynh Buu Quang to lead the bank’s expansion of its franchise in Vietnam, pending State Bank of Vietnam approval.

    As chief country officer Vietnam, Huang will be based in Ho Chi Minh City. He brings more than 25 years of experience in corporate banking, and has held local and regional leadership roles in Vietnam, Singapore, Hong Kong and Indonesia, across multiple banking functions spanning trade finance and credit risk management.

    Alexander von zur Muehlen, Deutsche Bank’s Asia Pacific CEO called Vietnam «a key growth market» for the bank in ASEAN, in a statement announcing the move.

    Deutsche Bank has operated in the country since 1992. Since 2017, the bank has raised more than $1 billion in debt, loan and equity capital annually for Vietnamese corporates.

    Earlier this year, Deutsche Bank announced that it would increase its investment in Vietnam, with the recently ratified EU-Vietnam Free Trade Agreement expected to boost trade flows.

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  • DBS Finances Floating Solar Farm

    DBS Finances Floating Solar Farm

    The bank is the sole financier for one of the world’s largest inland floating solar photovoltaic systems to date. DBS Bank has provided a $40 million loan facility to Sembcorp Industries to build a 60 megawatt-peak (MWp) floating solar photovoltaic (PV) system on Tengeh Reservoir in Tuas, Singapore, the bank announced on Thursday.

    The reservoir, scheduled to begin full commercial operations in 2021, covers an area of around 32 hectares and will generate enough energy to power about 16,000 four-room HDB flats, offsetting about 32 kilotons of carbon emissions annually, which equivalent to taking approximately 7,000 cars off the roads.

    As part of its transition to a low-carbon economy, Singapore aims to achieve a solar target of at least 2 gigawatt-peak (GWp) by 2030. With this project, Sembcorp will be one of the largest renewable energy players in Singapore with approximately 240 MWp of solar capacity in the country.

    Enabling renewable energy financing is at the core of DBS’ agenda and is one of the key tenets of our sustainability strategy, Lim Wee Seng, DBS Bank’s head of Energy, Chemicals, and Infrastructure, said about the investment.

    DBS seeks to differentiate itself in renewables financing – capturing financial advisory opportunities so we shape and influence early, Lim said.

    The bank was previously an advisor for Taiwan’s largest floating solar project and also Taiwan’s largest ground-mounted solar project, and earlier this year garnered four new advisory mandates across solar, wind and geothermal assets in Indonesia, Taiwan and Vietnam.

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  • Citi-Backed Data Management Firm to Expand in APAC

    Citi-Backed Data Management Firm to Expand in APAC

    U.K.-based enterprise data management company Solidatus said it will accelerate its growth plans in the region, following a strategic investment by Citi.

    Citi, the first major investor in the startup, will also implement the Solidatus platform internally at a global enterprise level, according to an announcement on Tuesday.

    Solidatus’ software helps organizations to gain greater insight and control of complex data across operational and technological ecosystems, which allows them to both satisfy regulators and react quickly to change. Its clients include retail giant Walmart and Deutsche Bank.

    The Solidatus solution will support Citi’s ongoing commitment to change management, helping our global infrastructure to stay agile, efficient and robust, Chris Hayward, Citi chief data officer, said in the announcement.

    Solidatus said it sees great opportunities in the Asia-Pacific market, and opened its Singapore office in 2019, which functions as its regional headquarters as it sets its sights on growth in Southeast Asia and China.

    The Singapore office is led by information technology and banking industry veteran John Berven, who previously spent almost 18 years at State Street, most recently as its head of real money FX sales in Hong Kong and Singapore.

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  • DBS to Train Staff in AI and Machine Learning

    DBS to Train Staff in AI and Machine Learning

    The bank hopes to equip its employees with skills in these areas, under a partnership with cloud services provider Amazon Web Services (AWS).

    DBS Bank will accelerate the use of artificial intelligence (AI) and machine learning (ML) across its business by training its staff in these skills with the launch of the AWS DeepRacer League, the bank announced on Tuesday.

    As part of the program, DBS staff will learn the basics of AI and ML through hands-on online tutorials and will use their knowledge in programming an autonomous model race car to compete in a virtual racing environment. The bank hopes to train some 3,000 employees, including its senior leadership, by the end of the year. The league is the largest among Asian-headquartered enterprises and one of the first in the world to be organized at scale by a financial institution, the announcement said.

    Employees are also encouraged to develop their talent beyond the bank’s league and compete globally – the bank said six of its employees have already qualified for the AWS DeepRacer Championship Cup to be held in Las Vegas later this year.

    We have never believed in limiting digital expertise to a small team. Instead, we passionately believe in democratizing technology skillsets among all employees, so that they can run alongside the company as we advance on our digital transformation together, Paul Cobban, DBS chief data and transformation officer, said.

    DBS said it is preparing for the next stage of its digital transformation efforts and has been leveraging AI and ML in areas such as advanced credit risk management, and to provide accurate self-service digital options to its retail customers based on their digital footprint.

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  • Lu Partners Thai Bank to Grow Digital Wealth Management

    Lu Partners Thai Bank to Grow Digital Wealth Management

    The Singapore-based subsidiary of leading Chinese retail fintech Lufax has announced a strategic partnership to meet rising demands for digital financial services in Thailand.

    Lu will work with Kasikornbank to jointly build a digital wealth management platform, which will be jointly operated and managed by both parties, to serve retail investors in Thailand, the company announced in a statement on Monday.

    The world is about to enter another wave of digital disruption as big players like commercial banks morph into fintech organizations. It is imperative that we quickly adjust ourselves and strengthen our capabilities to seek new business opportunities, Kattiya Indaravijaya, Kasikornbank CEO, said about the partnership.

    Established in 1945, Kasikornbank is the fourth-largest commercial bank in Thailand, with 17.3 million customers, including 12.7 million online users. The bank has been actively promoting the digitization process in recent years, and is committed to providing a full range of financial services through digital platforms to its customers.

    Lu International, Lufax’s first international arm, was set up in Singapore in 2017. Since then, it has grown its operations and market reach, which now spans several markets in Asia, with over 380,000 registered customers.

    The company said it plans to capitalize on growth opportunities for financial services in up-and-coming economies throughout and beyond Southeast Asia.

    «We will continue to grow our capabilities in Southeast Asia, extending our footprint in the region to meet the needs of our customers and support the business growth of our partners,» Kit Wong, Lu International CEO, said.

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  • UBS Asia Head Promises Higher Return

    UBS Asia Head Promises Higher Return

    Asia will contribute a much higher percentage to UBS’ earnings going forward, according to Edmund Koh, the head of the company’s business in the region. One reason is the region’s faster recovery from the corona-crisis.

    Asia contributed 30 percent to the profit of UBS in the first half of 2020, the first time that the region has had such a major impact on Switzerland’s largest bank. While Asia previously contributed with a share of between 14 and 20 percent of group earnings, the division now aims to go beyond 30 percent, said Edmund Koh, the head of UBS Asia-Pacific in an interview.

    The Asian economies seem to be emerging from the pandemic-induced slump much earlier than European and American economies, which is one of the main reasons for the surge in the contribution of the region to UBS earnings. UBS Asia-Pacific pretax profit jumped 71 percent to $233 million in the second quarter compared with a year earlier.

    With plenty of liquidity in the market and very low-interest rates, clients went shopping for higher yields in the first half, which meant that trading was brisk and invested assets rose, according to Koh.

    The banker expects the good earnings momentum to persist throughout the second half of 2020, with July being described as «pretty good». Koh told the newspaper that based on the team’s performance in the first half and since he would expect the unit to maintain the result and end the year on an all-time record.

    The U.S. elections and the economic slump in parts of the world most affected by the pandemic will create more «nervousness» in the market in the second half, which will present more opportunities for investors, Koh added. Overall, trade and consumption will fuel economic growth in Asia in the second half, which gives the bank reason to remain «risk-on» in the region. Singapore and India are the equity markets most preferred by UBS in Asia.

    Koh also suggested that the banking industry may suffer in coming quarters as government support measures end. Still, with UBS being in the market for the wealthy clientele, it is likely to be less affected by the risk of bad debt.

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  • OCBC Partners Asset Manager for New Fund

    OCBC Partners Asset Manager for New Fund

    The co-branded solution to address investor needs during times of stress and uncertainty and has a built-in dollar-cost averaging feature. French asset manager Amundi and OCBC Bank on Wednesday announced the launch of the Amundi-OCBC Momentum Fund – a mixed-asset product that invests in global bonds and equity ETFs.

    According to its prospectus, the Momentum Fund lets the portfolio manager initiate dollar-cost averaging for the investor. The fund leverages the cost-averaging effect when it systematically allocates assets from an initial pool of fixed income securities to equity ETFs, which helps to average out the costs of investing into equities and position the fund for a potential equity market recovery. Investors are also paid a quarterly dividend of up to 3 percent per annum.

    The fund is the first co-branded tie-up between the two partners, though OCBC has been distributing four other products from Amundi, according to the bank’s website.

    Investors should stay invested in the market and not wait for blue skies. They should manage risk by investing carefully and staying diversified across asset classes and by taking on risk gradually over time through regular investments – in other words – dollar-cost averaging. This can benefit investors by potentially lowering the average cost per unit of an investment, especially during times of volatility, Tan Siew Lee, OCBC’s head of wealth management, Singapore, said about the new fund.

    The bank noted the benefits of a multi-asset strategy in an uncertain economic environment, as it provides relative stability over equities. The fund has a target allocation of 50 percent global bonds and 50 percent global equity ETFs, with a maximum of 25 percent into non-investment grade bonds.

    DBS Bank also recently launched a multi-asset fund with Schroders that includes a unique decumulation share class targeted at retiree investors, with exposure to a range of investment growth themes across Asia.

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  • DBS Brings Automated Supplier Financing to Construction Sector

    DBS Brings Automated Supplier Financing to Construction Sector

    The solution aims to improve productivity and remove inefficiencies in the sector’s procurement and payment processes.DBS Bank has partnered with Singapore fintech Doxa to pioneer a procure-to-pay solution for Singapore’s construction sector, according to an announcement on Thursday.

    DBS worked with the main contractor Tiong Seng Group and its supplier network to validate the construction industry’s process flows and develop a solution to eliminate manual administrative processes that plague the industry. The solution, Doxa Connex, digitalizes and automates the majority of the manual procurement and payment processes and documentation, which could lead to a reduction in administrative fees and processing costs of at least 50 percent, the statement said.

    «Covid-19 has accelerated the need for many industries to turn to digital solutions to continue operating safely even amid manpower constraints, and the construction sector is no exception. Proactive and timely digital transformation will put construction companies in good stead for recovery and growth when economic activity picks up and demand for construction services resumes,» Chew Chong Lim, DBS managing director, and global head of real estate, institutional banking, said.

    The construction sector accounts for more than 4 percent of Singapore’s gross domestic product but has been slow to embrace technology along the construction value chain. The announcement cited a recent study by Autodesk and IDC that said only 2 percent of construction firms have automated most of their manual processes.

    Tiong Seng is keenly aware of the need to embrace Integrated Digital Delivery (IDD) in the entire value chain of the built environment sector. We have thus made digitalization one of our core drivers for industry transformation, John Keung, Chairman of Tiong Seng Contractors, said about the launch of Doxa Connex.

  • ABN Amro Overhauls Corporate Bank

    ABN Amro Overhauls Corporate Bank

    Following a review by its new CEO, the bank will wind down all of its non-European corporate banking operations and stop providing trade and commodity finance.

    «We will serve clients in segments where we can achieve scale, so we will focus on the Netherlands and Northwest Europe, where we will invest and grow,» CEO Robert Swaak, who was appointed in January, said in comments with the bank’s second-quarter results, published Thursday.

    Going forward, the bank’s Corporate & Institutional Banking (CIB) will focus on clients in Northwest Europe and Clearing and will exit all non-European corporate banking activities. Trade & Commodity Finance activities will be discontinued completely, and Natural Resources and Transportation & Logistics will be limited to Europe, while it will impose stricter lending criteria and credit limits, the bank said on Tuesday.

    Non-core activities, which comprise around 45 percent of CIB’s client loans, representing approximately 35 percent of CIB’s RWA and over 10 percent of total RWA, are expected to be wound down in the next three to four years and will affect around 800 full-time employees, of which 150 are in the Netherlands.

    A Netherlands-based spokesperson for ABN Amro said that the schedule of winding down for non-core activities has not been set and that it will differ based on business line and region. In Singapore, only its Clearing desk will remain.

    We can not yet say exactly how many jobs in Singapore are impacted. This will also be worked out in the coming period, the spokesperson said.

    The bank had one of the largest exposures of any bank to the collapse of Singapore oil trading company Hin Leong, at around $300 million. It also had a smaller exposure to Zenrock Commodities Trading, another scandal-hit Singapore oil trading firm.

  • Axa Mulls Sale of Singapore Unit

    Axa Mulls Sale of Singapore Unit

    The French insurer is reportedly considering the sale of its Singapore business as part of plans to raise funds by divesting peripheral operations.

    The firm is working with an adviser on the potential sale, which could take place in the next few weeks, Bloomberg reported on Tuesday, citing people familiar with the matter.

    The business, which offers life and property and casualty insurance, could draw interest from rivals looking to expand in the region, the report said, noting that the business generated €615 million ($722.71 million) of revenue in 2019, according to Axa’s annual report.

    Axa’s net profits in the first half of 2020 tumbled by 39 percent to €1.4 billion euros ($1.7 billion), as it took a hit from customer claims arising due to the coronavirus pandemic.

    Axa CEO Thomas Buberl has been trying to shift the firm’s focus on property and casualty insurance, following its $15.3 billion purchase of XL Group in 2018. It has been reviewing options for smaller businesses across the world, including in the Middle East, to help pay for the XL deal, «Bloomberg» said.

    Across the border in Malaysia, Axa is looking to raise funds from the sale of the life and general insurance joint ventures with Affin Bank. The sale could fetch some $650 million.

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