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Tag: Banking

  • Bank Stocks Slide

    Bank Stocks Slide

    The share prices of UBS and Credit Suisse tumbled in line with their European counterparts. Investors fear the coronavirus will spark a wider recession – and banks will bear the brunt.

    Credit Suisse shed more than 13 percent in early trading on Monday, losing more than the wider European banking index, which slid 12 percent. Meanwhile, UBS’ stock fell more than 11 percent.

    The slides illustrate that investors don’t believe a massive, coordinated plan by central banks overnight will be adequate to stave off recession sparked by the coronavirus pandemic. European banks, which have long procrastinated shaping up following the 2008/09 crisis, are especially vulnerable to this.

    Overnight, the U.S. central bank released its big guns with its second cut in two weeks and other policy easing measures. Major U.S. banks including J.P. Morgan said they would suspend share buybacks – a method preferred by banks to return capital to shareholders because it typically boosts stock prices.

    Credit Suisse has previously expected to buy back as much as 1 billion Swiss francs ($1.1 billion) in its own stock by year-end, but this is subject to economic conditions that have now changed dramatically. UBS is in the middle of a 2 billion franc, three-year buyback.

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  • Citi Targets Doubling of Singapore WM Market Share

    Citi Targets Doubling of Singapore WM Market Share

    From its current 5 percent, Citibank Singapore plans to double its wealth management market share alongside the number of clients by 2025.

    The bank’s Singapore chief executive Brendan Carney believed that the retail and wealth management business could further accelerate growth after assets grew 11 percent in 2019, including 19 percent client asset growth from its wealth management segment.

    We think there’s another gear that we can shift into and go from double-digit growth to really strong double-digit growth, Carney said.

    As part of the growth plans, the bank made investments in the tens of millions in a new flagship wealth management center based in one of Singapore’s major shopping and luxury areas, Orchard Road. The 30,000 square foot wealth management center will occupy four storeys including two floors for 400 relationship managers and specialists as well as two floors for client meetings and events.

    Though the bank hopes to add at least one more flagship center, its broader plan in the city-state is to reduce its branch presence. By the end of 2020, it targets three from 14 branches to 11 – one wealth management center, seven branches and three instant banking centers for basic transactional services.

    Still, Carney noted that Citi is not a digital-only bank and has not aspirations to become one. In fact, Citi will look to grow its client-facing staff by 20-25 percent over the next three to five years and also boost training for its existing relationship managers.

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  • Apple waives interest for Apple Card users amid COVID-19 pandemic

    Apple waives interest for Apple Card users amid COVID-19 pandemic

    Other than the very obvious health concerns caused by COVID-19, the ongoing pandemic is also causing much economic trouble. Apple introduced a customer assistance program for Apple Card users to help offset financial concerns.

    Many Apple Card users on Reddit have reportedly received an email about the new customer assistance program. Under this program, cardholders can skip their March payments without any additional interest.

    Apple hasn’t explicitly stated any eligibility requirements, so it looks like all Apple Card holders are eligible. They can enroll in this program in at least two ways: firstly, Apple evidently provides a direct link in their email announcing the program, which can be used to enroll.

    The other method is just as simple, with cardholders able to enroll through text by iMessaging the Apple Card Support line the following text: “I would like to enroll in the Customer Assistance Program”. The support number can be found in Apple’s support page for the credit card.

    Clearly, Apple is taking the COVID-19 outbreak very seriously, closing all Apple Stores outside of China for the time being as well as regulating App Store entries related to the virus. This latest offer is a kind gesture to its customers during a difficult time.

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  • DBS, Revenue Projections are a Moving Target

    DBS, Revenue Projections are a Moving Target

    DBS’ Tan Su Shan followed up on the estimates for a 2 percent of revenue cut, underlining that potential revisions could come should the pandemic prolong.

    Soon after the bank’s chief executive Piyush Gupta announced a modest 1-2 percent revenue reduction, institutional banking head Tan Su Shan followed up by adding that the matter was a «moving target» and that potential revisions could come.

    We are living day by day, week by week right now, she said in a report, highlighting that the estimate was based on the assumption that the pandemic would subside by mid-year. «The key here is to stay with the clients, watch everyone’s positions and make sure everyone is okay.»

    According to Tan, non-performing loans are expected to increase from small and medium-sized enterprises across tourism, apparel, hospitality and other sectors tied to consumer demand. Nonetheless, she noted that Singapore and other parts of Asia are observing signs of stability fuelled by government stimulus though business confidence and a recovery in consumer demand still lag.

    For 2019, DBS demonstrated resilience posting a 14 percent increase to net profits to a record S$6.4 billion ($4.5 billion) from a 10 percent year-on-year income increase. From such a position, its modest revenue cut projection signals greater risks in the broader financial industry, especially amongst players with greater China exposure.

    AIA, for example, noted that face-to-face meetings in China, which account for 40 percent of sales, took a hit, though its online sales managed to partially offset the loss. Its soon to retire chief executive and president Ng Keng Hooi noted the headwinds the insurer faced from the coronavirus and low-interest rates but remains optimistic that  «the industry would overcome this down cycle and come out stronger», in a report.

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  • BNP Paribas Wins VCC Mandate

    BNP Paribas Wins VCC Mandate

    It will provide fund administration and global custody services in Singapore to Kamet Capital Partners.

    Multi-family office Kamet Capital Partners, one of the first fund managers to use Singapore’s Variable Capital Company (VCC) structure, is partnering BNP Paribas Securities Services in its plans to use the VCC.

    We selected BNP Paribas Securities Services for its attention to client needs and willingness to grow alongside Kamet, said Kerry Goh, chief executive officer of Kamet Capital Partners, said in a statement issued by BNP Paribas on Tuesday.

    Goh founded Kamet in 2017 after leaving Julius Baer, where he was head of portfolio management, Asia. Kamet’s Long Term Capital fund invests 60–70 percent of its portfolio in public securities, and the balance in alternatives and private investments.

    The VCC framework, launched in January, is part of Singapore’s plans to attract more funds to base themselves in the city-state.

    Catered to the needs of global investment funds and investors, fund managers will have greater flexibility in share issuance/redemption and the payment of dividends. Managers can also incorporate multiple funds in a single VCC to save costs.

    The initiative has already borne fruit, with Mindful Wealth redomiciling its flagship fund to Singapore under the framework, and RF Fund Management announcing it would be setting up its inaugural private equity fund to focus on fintech and property investments in Asia.

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  • HSBC Names New Head of China Investment Bank

    HSBC Names New Head of China Investment Bank

    Leadership shuffles continue under the watch of HSBC’s interim chief executive Noel Quinn including the latest renaming of the head of its China investment banking arm to succeed David Liao.

    Mark Wang Yunfeng, most recently the bank’s China head of global banking and markets, succeeds Liao as president and chief executive of China. Previously, he had held senior roles with Bank of China and Deutsche Bank.

    Liao will remain with the bank and be shifted to another senior position.

    China is central to HSBC’s strategic aim of accelerating growth from its Asian franchise,» said Peter Wong, HSBC’s China chairman. «With his extensive banking experience, particularly in driving China-related business in trading and capital markets, Mark will lead one of the group’s most important markets, helping us to support our customers’ businesses within as well as outside the mainland.

    Wang’s promotion follows a series of other shuffles at HSBC’s top management globally including the appointment this year of Stephen Moss, former group CEO chief of staff, as the regional chief executive overseeing the Middle East, North Africa and Turkey; Latin America and Canada; and most of Europe. Last year, the U.S. CEO was also renamed to former Citi banker Michael Roberts.

    But the question remains about the shuffling of the highest rank. The permanence of Quinn’s role continues to be in doubt since he was named interim head, succeeding John Flint who lasted just 18 months. Onlookers expected closure to the matter during the last annual meeting but no such thing occurred and the bank responded by saying that the appointment process was «ongoing» and in line with its six to 12-month timetable.

    In addition to a massive group overhaul involving up to 35,000 job cuts and a target of $4.5 billion in annual cost savings, the bank faces political headwinds for its China business. Wang takes on an investment bank whose interests in the mainland have already landed it in the crossfires twice including the U.S.-Huawei debacle and the controversial closure an account linked to pro-democracy activities in Hong Kong last year.

    Still, the region will be equipped with internal tailwinds. The bank is set to concentrate its bets on Asia despite the said hurdles alongside a broader challenging environment that now includes a coronavirus pandemic. HSBC most recently announced that it had already hired 800 people since 2017 for its affluent banking businesses in Hong Kong, China and Singapore.

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  • OCBC Enables Encashment of Cheques at ATMs

    OCBC Enables Encashment of Cheques at ATMs

    OCBC Bank has rolled out a cheque encashment service across all its next-generation ATMs at 23 branches, making it the first bank to offer such services in Southeast Asia.

    Recognizing that there are still segments of customers who require services like cheque encashments, OCBC has enabled its next-generation ATMs to process 90 percent of all the cheques usually encashed at its branch teller counters.

    It takes up a significant amount of time for a customer and counter teller staff just to fulfill a single such transaction. We have addressed this by enabling transactions such as cheque encashment to be performed seamlessly on our next-generation ATMs instead, said Sunny Quek, OCBC Bank’s Singapore head of consumer financial services, in a media statement on Thursday.

    Since February this year, customers have been able to encash cheques – for up to a maximum of $30,000 in a single cheque – by depositing them into the ATM to instantly get cash. As a result, the average cheque encashment transaction time has been reduced to under three minutes at the ATM, as customers can save about 60 percent of their time compared to waiting to be served at a branch.

    All the necessary security checks and verifications are performed by the lender’s «digital ambassadors,» or staff located at its branch on mobile tablets in real-time, to ensure security. The next-generation ATMs have already processed cheque encashments totaling close to S$17 million, the bank said.

    Even as Singapore pushes to become cheque free by 2025, cash cheques continue to be used by small and medium-sized enterprises (SMEs), typically to pay staff salaries, get cash for daily business operations, or pay vendors for services rendered.

    While cheque usage by OCBC Bank’s retail banking customers has fallen 40 percent since 2018, one in six cash transactions performed by OCBC Bank tellers over the counter are still cash cheque encashment, with 95 percent of these cheques issued by SMEs.

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  • Citi Singapore Doubles Paternity Leave

    Citi Singapore Doubles Paternity Leave

    The move is part of the bank’s initiatives to create an inclusive workplace and follows moves to increase female representation in senior roles and narrow the wage gap between male and female staff.

    Citi Singapore is extending its paid paternity leave from the government-mandated two weeks, to four weeks, under enhanced parental leave policies that are being rolled out globally in 74 markets this year.

    This move is in line with Citi’s new global paid parental leave policy to recognize the role that both parents play in raising a child, as well as to build an inclusive workplace, a statement on Wednesday said.

    The policy was launched on January 21, but will be backdated to January 1 for the first 18 markets, which includes Singapore. The leave, which applies to staff of all nationalities, must be used within the year of the child’s birth. New mothers will continue to receive 16 weeks of paid leave, the bank said.

    The move helps to drive greater gender equality, transform the perception that caregiving is only a female responsibility and create a more level playing field at home and at work, Jorge Osorio, head of human resources, Citi Singapore, said.

    In January, the bank said it would work towards increasing global representation of women in Assistant Vice President to Managing Director level roles to a minimum of 40 percent by 2021 to address its unadjusted pay gap. The share of females in such roles in Singapore grew from 32 percent in December 2017, to 36 percent in December 2019.

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  • Former Citi Banker Returns to Head FIG in Hong Kong

    Former Citi Banker Returns to Head FIG in Hong Kong

    A former investment banker with Citi will be returning to the American lender to lead its financial institution’s group for Hong Kong.

    Loretta Ko joins as the head of the FIG unit for Hong Kong from Banco Santander, where she held the same position. In addition to Citi, where she spent 15 years between 1989 and 2004, she had previously also worked for the likes of ANZ and Standard Chartered.

    Hong Kong financial institutions (group) is a significant and growing part of corporate banking in the country as well as a critical contributor to the broader Asia Pacific financial institutions franchise, said a report citing the bank’s statement.

    Not unlike many major competitors, Citi has placed a focus on creating a quantitive gender balance in its workforce which includes a target of having women make up at least 40 percent of assistance vice president to managing director-leveled jobs by 2021-end.

    According to the bank, Asia is rapidly making progress towards that goal with the current figure at 39 percent. In 2019, 14 of the total 45 newly named managing directors (31 percent) in Asia were female, up from eight in the previous year.

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  • Ant Financial Services targets 40 million service providers

    Ant Financial Services targets 40 million service providers

    Ant Financial Services subsidiary Alipay says it will spend the next three years opening up its online payments platform to support the digital transformation of 40 million service providers across China.

    “The service sector in China is still in the nascent stages of digital transformation, and that means it has huge untapped potential,” said Ant Financial CEO Simon Hu.

    He said consumer demand for digitalized services has been expanding rapidly in Mainland China with the number of searches for lifestyle services within the Alipay app surging 300 percent last year alone. Currently, just 1 million service providers are on the platform.

    “Alipay’s success has always depended on the success of our partners, and that is why we believe the only way to best serve consumers is to open up our platform further, so service providers can better tap into consumer demands,” he said.

    “Building a one-stop digital lifestyle platform not only creates immense value for our users – it will also play an essential role in accelerating the digital transformation of the service industry and unlocking more growth opportunities.”

    Alipay will work with 50,000 independent software vendors to help the service providers digitize their operations, helping service companies in fields including consumer retail, food-and-beverage, hotels-and-accommodations, transportation and medical services.

    Hu said that during the coronavirus outbreak, Alipay launched an incentive program for service providers to create mini-programs that could help consumers deal with the impact, including providing for the needs of people forced to stay at home and minimizing physical contact with service providers. It took just one week for more than 1200 developers to respond and 181 mini-programs were created allowing ‘contactless services’ in areas such as grocery delivery, medical and legal advice, logistics and public services. One, offering free medical advice by AliHealth, attracted an average of 700,000 visits daily.

    “Amid the ongoing coronavirus outbreak, we have also seen how digital technology can be used to help service providers become more agile and respond effectively to the fast-changing market environment,” said Hu.

    Another example was Beijing grocery startup Meicai, which connects farmers with consumers and restaurants. A mini-program making its delivery services available to Alipay users amid the coronavirus outbreak drew more than 800,000 new users and attracted orders from 80 cities across China.

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  • CIMB Chief Steps Down To Take Finance Minister Role

    CIMB Chief Steps Down To Take Finance Minister Role

    CIMB Group Holdings announced on Monday that its chief has relinquished his post on Monday, as he has been appointed the new Finance Minister in Malaysia.

    Zafrul Tengku Abdul Aziz , who has been appointed the new Finance Minister on Monday, has resigned as group CEO of CIMB Group Holdings and CEO of CIMB Bank. He has also resigned from all other board positions on the same date, the lender said in a statement on Monday.

    The appointment of Zafrul was announced by Prime Minister Muhyiddin Yassin when he unveiled his new Cabinet. Tengku Zafrul has served the Group for six years when he re-joined in 2014. He has done an outstanding job, shaping CIMB’s transformation under our T18 and Forward23 strategic plans, said Chairman of CIMB Group Holdings Mohd Nasir Ahmad.

    In his place, the board has appointed Omar Siddiq, currently the Group Chief Operating Officer, as Officer-in-Charge for CIMB Group and CIMB Bank Berhad, marking a start in the group’s succession plan.

    CIMB Group is Malaysia’s second-largest financial services provider by assets, offering consumer banking, commercial banking, investment banking, Islamic banking, and asset management products and services. Headquartered in Kuala Lumpur, the Group is present in all 10 Southeast Asian nations (Malaysia, Indonesia, Singapore, Thailand, Cambodia, Brunei, Vietnam, Myanmar, Laos and Philippines), with 702 branches as at 31 December 2019.

    Beyond Southeast Asia, the Group has market presence in China, Hong Kong, India, Korea, the U.S., and U.K. CIMB Group operates its business through three main brand entities, CIMB Bank, CIMB Investment Bank, and CIMB Islamic. CIMB Group is also the 92.5 percent shareholder of Bank CIMB Niaga in Indonesia, and 94.8 percent shareholder of CIMB Thai in Thailand.

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  • HSBC Taps Zoom to Maintain Client Interaction

    HSBC Taps Zoom to Maintain Client Interaction

    The bank is rolling out video conferencing for its Jade customers and says it will extend the service to HSBC Premier customers in the next few weeks.

    Amid the Covid-19 outbreak, HSBC is hoping remote conferencing services will help the bank enhance communication between customers and its relationship managers and investment specialists.

    In a statement on Wednesday, the bank said it has rolled out video conferencing using the Zoom service to interact and conduct wealth management related activities with Jade customers.

    A virtual face-to-face interaction will facilitate more in-depth discussion between customers and relationship managers, especially on more detailed wealth planning topics, said Greg Hingston, head of retail banking and wealth management, Hong Kong.

    Jade focuses on clients with a minimum account size of $1 million, a segment the bank describes as emerging wealth, in contrast with HSBC Private Banking, which requires a minimum account size of $5 million.

    The service gives customers access to dedicated relationship managers and specialists, customized and exclusive investment solutions, as well as luxury concierge services and «exclusive experiences.»

    As of end-August 2019, it had more than 150,000 customers globally in eight markets. In 2019, four Jade Centres were opened across Singapore, Hong Kong, and Shanghai. This year, HSBC opened two more Jade Centres in Hong Kong, and plans to open one in Beijing.

    HSBC has been building its wealth teams across Asia, as it announced the launch of a new global business, combining retail banking and wealth management and global private banking on Monday.

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  • Axa Appoints Managing Director In Newly-Merged Unit

    Axa Appoints Managing Director In Newly-Merged Unit

    Axa Insurance Singapore named a managing director for retail and health, as part of a broader strategy to streamline its businesses.

    Effective immediately, Julien Callard will lead the retail and health strategic business unit in a newly expanded role, with responsibility for driving the continued growth of Axa’s retail business and health business as well as the respective distribution functions. This includes developing a differentiated value proposition and offerings that will strengthen its position as a health partner to its customers.

    Over the past 20 years, Callard has held several leadership roles across the Axa Group and developed deep and extensive knowledge of the business, said Jean Drouffe, CEO of Axa Singapore in a statement.

    The appointment is part of a broader strategy to streamline and strengthen Axa’s business by merging its retail and health strategic business units, in order to become a more customer-centered company, the insurance group said. Callard originally joined the Axa Group in 2000 and he has held senior positions across multiple countries spanning actuarial, risk, marketing and reinsurance.

    Prior to joining Axa Singapore, he was Head of retail property and casualty at Axa Mexico. He has worked in operational and functional positions across retail, commercial, and reinsurance lines.

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  • Sergio Ermotti Set to Leave UBS

    Sergio Ermotti Set to Leave UBS

    UBS Chief Executive Sergio Ermotti will leave the bank after retiring from his position later this year. He won’t become the chairman of Switzerland’s largest bank, as some observers had expected.

    Instead, Sergio Ermotti on April 17 will stand for election as a non-executive member of the board of Swiss Re, the world’s second-largest reinsurer.

    In 2021, he will be nominated to succeed Walter Kielholz as chairman, according to a statement by Swiss Re on Tuesday.

    Kielholz is one of the heavyweights in Swiss finance and has been chairman of Swiss Re since 2009. He was on the board of the reinsurer for more than 20 years. Between 2003 and 2009, Kielholz was chairman of Credit Suisse.

    I am honored to be following in the footsteps of Walter Kielholz, who over the past decades immensely furthered the development not only of Swiss Re, but the entire Swiss financial center, said Ermotti, according to the statement.

    Today’s announcement put paid to speculation that CEO Ermotti would be replacing Chairman Axel Weber after retiring from his current position at the end of October. When the bank announced Ermotti’s departure at the end of February, it didn’t make a statement about a potential handover of responsibilities at the top of the bank.

    At the end of his tenure at UBS, Ermotti will have been CEO of Switzerland’s biggest bank for nine years. Together with Weber, who was elected chairman of the bank in 2012, he has moved UBS away from the classic investment banking model toward a strategy based on wealth management.

    More recently, the talk had been about differences of opinion at the top as the board was said to be unhappy how Ermotti had set up his succession plan. UBS has not been able to give the share price a boost, which has never recovered from the financial crisis.

    The appointment of Dutch banker Ralph Hamers in February as Ermotti’s successor came as a major surprise. Hamers is known for his digital banking expertise and will need to get UBS ready for the future.

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  • HSBC Hires Wealth Teams Across Asia

    HSBC Hires Wealth Teams Across Asia

    HSBC has announced the launch of a new global business, combining retail banking and wealth management and global private banking. Recruitment for wealth teams across Hong Kong, Singapore, and mainland China is on track.

    HSBC’s new unit will become one of the world’s largest global wealth managers with $.4 trillion in assets, with nearly half of the assets from Asia, according to a media release on Monday. Wealth and personal banking will cover the entire spectrum of private wealth, from retail clients to ultra-high net worth (UHNW) individuals.

    Across Asia, where wealth pools are growing faster than in any other region, HSBC’s wealth revenues grew 12 percent in 2019 (year on year) to $.7 billion.

    This move creates one of the world’s largest and fastest-growing wealth franchises, centered in Asia and serving clients around the world. HSBC’s wealth propositions are compelling, increasingly digital and support individuals no matter where they are in their wealth journey, from first-time investors – to clients considering generational planning needs, Charlie Nunn, CEO of Wealth and Personal Banking, HSBC, said.

    In 2019, HSBC grew affluent and emerging high net worth clients globally in Premier1 and Jade, respectively, by 7 percent and 14 percent year on year. Over half of Jade’s total clients globally are in Asia. Global private banking, where profit before tax grew by 19 percent, attracted a record $23 billion of net new money in 2019, two-thirds of which were in Asia. 2019 also saw an increase in Asia client assets of 22 percent to $51 billion.

    Recruitment for wealth teams across Hong Kong, Singapore, and mainland China is on track. Since 2017, both businesses have recruited 800 people, including private bank relationship managers, investment counselors, UHNW solution specialists, and product specialists, and Jade directors and relationship managers, investment and insurance specialists.

    In 2019, four Jade Centres were opened across Singapore, Hong Kong, and Shanghai. This year, HSBC has recently opened two more Jade Centres in Hong Kong and plans to open one in Beijing.

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