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Tag: Finance

  • DBS Starts Commodity Trading on LME

    DBS Starts Commodity Trading on LME

    The bank is the first in Asia to hold a London Metal Exchange (LME) trading membership outside of London.

    DBS is one of four Category 4 members on the LME, which allows it to trade and issue client contracts but doesn’t give it clearing abilities.

    The LME membership paves the way for the bank’s corporate clients in Singapore, China, India, Indonesia, Korea, and Hong Kong to have access to a broader suite of hedging and financial solutions to support the diverse needs of metal businesses, DBS said in an announcement this week.

    It will also provide the bank’s clients in the metals and mining space with the option to access sustainably-produced metal, Tan Su Shan, DBS group head of institutional banking, said.

    Metals are an essential enabler to achieve a sustainable future, and as global demand for the commodity continues to grow exponentially, so will expectations on the industry’s sustainability standards, Tan said.

    The 144-year-old bourse is the global hub for metals trading and was acquired by Hong Kong Exchanges and Clearing in 2012.

  • DBS Starts Commodity Trading on LME

    DBS Starts Commodity Trading on LME

    The bank is the first in Asia to hold a London Metal Exchange (LME) trading membership outside of London.

    DBS is one of four Category 4 members on the LME, which allows it to trade and issue client contracts but doesn’t give it clearing abilities.

    The LME membership paves the way for the bank’s corporate clients in Singapore, China, India, Indonesia, Korea and Hong Kong to have access to a broader suite of hedging and financial solutions to support the diverse needs of metal businesses, DBS said in an announcement this week.

    It will also provide the bank’s clients in the metals and mining space with the option to access sustainably-produced metal, Tan Su Shan, DBS group head of institutional banking, said.

    «Metals are an essential enabler to achieve a sustainable future, and as global demand for the commodity continues to grow exponentially, so will expectations on the industry’s sustainability standards,» Tan said.

    The 144-year-old bourse is the global hub for metals trading and was acquired by Hong Kong Exchanges and Clearing in 2012.

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  • The Year Global Banking Became Impossible

    The Year Global Banking Became Impossible

    U.S. sanctions and China’s new anti-sanctions law are creating internal compliance mayhem for international banks – and Swiss finance.

    The average compliance officer is facing a world of hurt right now. President Joe Biden’s executive order earlier this month drastically expanded the scope and range of prohibitions against Chinese companies and sovereign-owned entities, and it was met a week later by China’s new anti-sanctions law.

    Although conventional wisdom seems to point towards technological decoupling and irreconcilable compliance problems, the immediate truth is probably a starker, simpler one.

    The average bank or international company in Asia has probably spent the last couple of weeks shadow boxing itself into an unenviable corner. There are likely to be any number of incredibly angry emails going around and quickly convened meetings that decide nothing much. They are then immediately forgotten until the next unsolvable quandary pops up.

    What usually happens is that the combined compliance and risk apparatus, including the legal function, are caught fighting a desperate rear-guard action while still trying to grapple with doing the right thing. So, they call in external legal counsel.

    And law firms have been more than glad to provide. Although they are simply saying what a senior compliance person should be able to verbalize at management or committee meetings, they at least provide a lead-in, a buffer, in front of an irate front-line and management demanding clear and instant answers when there are none.

    It always seems to sound nicer when you schedule a conference call with external parties or, failing that, you can at least point towards or wave a fresh color printout – kind of like Chamberlain after Munich.

    After canvassing the web for literally five minutes with one search engine, a few opinions stand out for the average compliance person to choose from. Law firm Wilmer Hale goes pretty far out on a limb, saying the anti-sanctions law «creates far-reaching potential risks including the extraterritorial scope and a seemingly unbounded catchall provision.»

    They should probably only be used in extremis, although the firm did say it was «prepared to advise clients on how to comply with sanctions regimes in a way that makes sense for their business and to assist as needed in assessing the business implications of the ASL».

    Law firm Mayer Brown was more moderated, saying the law «further expands the risks for both Chinese and non-Chinese companies and individuals who have operations or dealings in or with China, particularly those who may be subject to conflicting legal obligations».

    Linklaters was much more subdued, saying «with these measures the PRC intends to counter attempts to influence its affairs by foreign governments via sanctions or other measures» before adding that clients should reach out to their usual contacts if they want to discuss it in more detail. All three are good choices to pad out any internal meeting even though they might not sway a decision in the direction intended.

    If all else fails, and the decision goes completely the wrong way, blame the screening team for everything.

    After all, they are the messenger and they always deserve to get shot.

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  • UBS Issues First Green Bonds

    UBS Issues First Green Bonds

    UBS has issued its first green bonds which it will use to finance mortgages for low-energy buildings.

    Major Swiss bank UBS Tuesday issued its first «green bonds»

    They are in two tranches, one of 500 million euros ($595 million) with a five-year maturity and a seven-year one of 250 million francs ($272 million), the bank said in a press release.

    UBS said the bonds were issued under its Green Funding Framework which is based on international rules. The framework defines green investments in the form of mortgages on Swiss buildings which meet the Minergie standard for low-energy buildings. The bank intends to expand the pool of suitable assets continually.

    The bonds will help UBS kill several birds with one stone. It will be keeping its promise to achieve net-zero greenhouse gas emissions across its entire business by 2050 as well as helping its clients with sustainability.

    The «green bonds» will also bolster its balance sheet by helping refinance its mortgage book on a broader basis.

    Environmental Balance Sheet

    They will also help its environmental balance sheet. A recent study showed 35 percent, or $13.4 billion, of UBS’ loans book’s exposure to what the bank terms climate-sensitive industries was in real estate.

    Reducing high-carbon positions on the balance sheet is more important than simply cutting exposure to climate-sensitive sectors such as real estate. We don’t serve the community better by reducing real estate lending, rather, by making real estate lending greener.

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  • DBS Launches Digital Bond Marketplace

    DBS Launches Digital Bond Marketplace

    The bank is launching a marketplace that for issuers to directly issue their own bonds connect with investors.

    DBS is launching the Fixed Income Exchange (FIX) to digitalize and make the bond issuance process more efficient, the bank announced on Tuesday in a statement.

    FIX allows issuers to directly issue bonds to the marketplace, and fully digitalizes and automates issuance-related documentation. It also supports issuers in generating digital bond-ready transactions, which can be listed and traded on the DBS Digital Exchange (DDEx).

    Keppel Corporation is the first corporate issuer on the platform, with a $1 billion Euro-Commercial Paper Programme.

    With FIX, DBS said it hopes to make capital markets access more time and cost-efficient, while also developing the breadth and depth of Asian bond markets at a faster pace.

    The time is ripe for traditional ways of bond origination to make way for a more digital approach, to do what has been aspired for so long – by taking the first step towards the creation of an independent platform that allows bond issuers efficient and effective direct access to the market place and bond investors, Clifford Lee, global head of fixed income at DBS, said in the announcement.

    Just last week, domestic rival UOB piloted the digital issuance of its latest bond offering on exchange-operated digital asset issuance platform Marketnode, a joint venture between Singapore Exchange and Temasek.

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  • Vietnam’s credit growth doubles

    Vietnam’s credit growth doubles

    Bank credit growth from January 1 to June 15 was 5.1 percent, double the rate recorded in the same period last year.

    The jump came despite the fourth wave of Covid-19 because the State Bank of Vietnam made monetary policy more flexible and directed banks to focus on funding manufacturing and reduce lending to sectors with high risks, its deputy governor, Dao Minh Tu, said Monday.

    Average loan interests in April fell by 0.3 percentage points from December, he added.

    The central bank has also directed banks to delay debt payment or lower or scrap interests on customers affected by the Covid-19 pandemic to help their business recovery.

    Nearly 676,700 customers have seen the interests of their debts removed or reduced with a total outstanding loan of nearly VND1,278 trillion.

    The bank will continue to pursue a flexible monetary policy until the end of the year keep inflation under control and support an economic recovery.

    The pandemic has boosted demand for online payment. In the first four months, internet payment value surged 31 percent year-on-year.

  • OCBC Appoints Group COO

    OCBC Appoints Group COO

    OCBC has appointed a new group chief operating officer in an effort to drive and accelerate transformation at the Singapore-based bank.

    Lim Khiang Tong has been named group COO – a newly created role – according to a statement, effective June 21 this year. Lim will report to recently appointed group chief executive Helen Wong.

    Lim has 30 years of management experience in strategic tech development, information technology, process reengineering, project management, and banking operations. He joined OCBC’s IT management team in 2000 before being appointed to lead the unit in 2002. In 2007, he was named head of group IT and in 2010, he assumed the role of head of group operations and technology.

    Lim will take on the expanded role in an effort to «optimize and intensify» investments across tech, product processes, and people.

    Lim has been instrumental in building our operational and technology capabilities and in driving our digital transformation efforts, Wong said. He is highly regarded by colleagues, business partners and industry peers. It is only fitting that he assumes this new role.

    Lim has already made various efforts to bolster the bank’s tech capabilities including the development of the first technology command center monitoring and managing both cybersecurity and daily operations – the OCBC Regional Data Center.

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  • Open Finance Startup to Expand Across Southeast Asia

    Open Finance Startup to Expand Across Southeast Asia

    Singapore-based Finantier has closed an oversubscribed seed financing round at more than 20 times its pre-seed valuation.

    Finantier plans to strengthen its presence in Indonesia and Southeast Asia after raising seven figures in seed funding in a round led by Global Founders Capital and East Ventures, it announced on Wednesday.

    Founded in 2020, the fintech provides an application programming interface (API) platform for financial institutions to access and analyze consumer financial data. The new funds will also go towards scaling and enhancing its product offerings and double the size of its team.

    Southeast Asia’s large unbanked population presents challenges for financial institutions who lack access to consumer financial data, handicapping them in providing financial services such as payments, lending, and insurance, among others, Finantier explained.

    To address this, the company works with over 150 companies to aggregate data from alternative sources to give its clients access to a more comprehensive range of datasets and enable the unbanked population to benefit from their digital data footprint.

    Finantier’s clients and partnerships have seen over 50 percent monthly growth in 2021, while its team has grown fivefold to 50 employees, the company said.

    Open finance is an extension of open banking data-sharing principles to enable third-party providers to access customers’ data across a broader range of financial sectors and products, including savings and investments.

    With open finance facilitating the open exchange of consumer data, companies can leverage it to reach more customers while creating more personalized financial services, Diego Rojas, Finantier co-founder and CEO, said.

    Rojas previously worked closely with the co-founders of NYSE-listed LendingClub and was the technical lead at the founding team of GIC-backed Chinese online lending marketplace Dianrong.

    COO Edwin Kusuma was previously from Google and was also formerly CEO of P2P lending firm 360Kredi and director of operations at Kredinesia, while CPO Keng Low was the technical lead for a payments startup in Silicon Valley and previously an Entrepreneur-in-Residence at East Ventures.

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  • Technology Banker Returns to UBS

    Technology Banker Returns to UBS

    Swiss bank UBS enticed a key technology banker back, after a six-month stint at Wells Fargo.

    UBS is hiring Paul McEwen as its head of technology services. McEwen had previously overseen the Swiss bank’s cloud services before leaving six months ago for Wells Fargo, which hired him as head of the infrastructure.

    He will be back at UBS next month, the newswire reported, and report to Mike Dargan, who was recently elevated into UBS’ top management.

    Dargan now oversees technology as well as UBS’s group corporate services. CEO Ralph Hamers has called the new job crucial in differentiating UBS.

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  • UBS Remains in Race for Dutch Asset Manager

    UBS Remains in Race for Dutch Asset Manager

    The Swiss bank is among the suitors remaining for Dutch asset manager NN. The competition for NN is strong – but UBS may have an ace up its sleeve.

    The sale of Dutch money manager NN is entering the next round with UBS, DWS, Prudential, and U.S.-based Nuveen submitting bids. None of the reported suitors nor the target commented.

    The potential acquirers are in the midst of due diligence, according to the newswire, though the deadline to place bids for the 300 million euro ($363 million) asset manager is July 1. The other firms which had expressed interest in buying – including Allianz, Generali, and The Royal London Group – have retreated.

    NN aims to take in as much as 1.6 billion euros by selling. UBS has somewhat of an inside track on NN because ING spun it off in 2014 – under then-CEO Ralph Hamers, who moved to the UBS top job last November.

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  • Bank of Singapore Nets Ex-UBS Wealth Planning Veteran

    Bank of Singapore Nets Ex-UBS Wealth Planning Veteran

    Bank of Singapore bolsters its business with the hire of a 30-year wealth planning veteran from UBS.

    Bank of Singapore hires Paul Chua as its global head of wealth planning, according to a statement, effective June 28 this year.

    In his Singapore-based role, Chua reports to global head of products Lim Leong Guan.

    Chua succeeds Tariq Salem who remains with the bank to focus exclusively on his role as head of structured solutions group.

    Chua has over 30 years of tax and wealth planning experience in advising ultrahigh net worth and multi-generational families on the structuring of their estate, succession, and wealth transfer strategies.

    He was most recently with UBS where he spent 19 years, last as its Singapore head of wealth planning.

    Aside from exemplary leadership qualities, Chua is known as an industry veteran who extends a personal touch when dealing with clients, said Lim, who also joined Bank of Singapore from UBS last year. We are confident that he will be a key addition to our wealth planning team to help develop deeper and more meaningful relationships with our clients.

    At a minimum net worth of $250 million, Bank of Singapore is increasingly focused on the family office segment which has seen clients onboarded triple in 2020 compared to 2019.

    The bank also hired Carrie Ng as head of single-family office advisory – a newly created role – in March this year and Joanna Ho as the Greater China and North Asia head of wealth planning last year.

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  • UOB Pilots Digital Signature Authorization

    UOB Pilots Digital Signature Authorization

    The initiative will remove one of the roadblocks – the need for physical signatures – in fully digitalizing the documentation process.

    UOB is starting a 12-month trial to test the use of Government Technology Agency’s (GovTech) Sign with Singpass among its retail and corporate customers, which will be used to confirm transactions such as individual wealth planning services and the PayNow Corporate application using a customer’s digital signature, the bank announced on Thursday.

    The features feature enables customers to use Singpass – the digital identity for Singapore residents that is identifiable and uniquely linked to the user – to sign electronic documents digitally via the Singpass app.

    The bank said it is pushing this innovation as research shows that COVID-19 has accelerated the move to online services, with more than 65 percent of customers expecting banking services to be digital by default.

    The change in customer expectations and experience during COVID-19 has made it imperative that we explore and extend our digital capabilities across more of our financial services and products, Susan Hwee, UOB head of group technology and operations, said in the announcement.

    UOB plans to expand the service to include more of its products and services for both the retail and wholesale segments in Singapore, and to expand its electronic signature capability to the region from 2022.

    One benefit from the move to e-signatures is its reduction of paper usage – more than 2 million multi-page hardcopy documents each year, which in turn will save more than 700 trees per year, once rolled out across its markets.

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  • Volkswagen, Ford To Exit Auto Finance Business In India

    Volkswagen, Ford To Exit Auto Finance Business In India

    The auto financing arms of Volkswagen AG and Ford Motor Co plan to stop giving new credit to car buyers and dealers in India and will exit from the country, sources aware of the development told Reuters. Volkswagen Finance Private Ltd, the German carmaker’s finance arm, stopped giving loans to car buyers in India last year and in May told dealers of all VW brands, which includes Volkswagen, Skoda and Audi, to find another financing, two sources with direct knowledge of the talks said.

    As some customers failed to make repayments, the finance unit has suffered losses, and will close for business by Dec. 31, the sources said.

    More than 50% of Volkswagen group dealers use credit from the finance arm, they said.

    Volkswagen Finance Private Ltd said in a statement that it had acquired a major stake in Indian loan brokerage portal KUWY Technologies to service its retail customers.

    It is in talks with dealers and will review its business strategy by the end of the year, the company said.

    The auto finance arms are classified as non-banking financial companies (NBFCs) and they compete with banks for providing credit. But banks have access to cheaper funding so can offer loans at lower rates than those offered by NBFCs or shadow lenders.

    To offset the disadvantage, Volkswagen and Ford would offer incentives to those dealers who have used their credit finance, the sources said.

    Dealers typically need credit to buy cars from automakers which they then sell on to customers.

    Volkswagen’s plan to exit the financing business has surprised dealers, coming weeks ahead of the launch of Skoda’s new sport-utility vehicle (SUV) to boost sales in India, the two sources said.

    Skoda dealers have been asked to find new financing by the end of the month – a tight deadline ahead of a new model launch, one source said.

    Ford Credit, the automaker’s financing arm, stopped lending to car buyers at the end of last year and will cease credit to dealers by June 30, two separate sources said.

    The decision to exit the financing business comes at a time when Ford is finalizing a new strategy for India after ending ties with Mahindra & Mahindra on Dec. 31.

    A Ford Motor India spokesperson said the company regularly assesses market conditions for its credit business and the decision to discontinue was conveyed to dealers in October – before it made any announcement on the Mahindra partnership.

    “We are confident the auto financing sector in India can support Ford customer and dealer new financing needs. Our team continues to service our existing book of business,” the spokesperson said, adding that 25%-30% of its dealers do business with Ford Credit.

  • UOB Pilots Digital Signature Authorization

    UOB Pilots Digital Signature Authorization

    The initiative will remove one of the roadblocks – the need for physical signatures – in fully digitalizing the documentation process.

    UOB is starting a 12-month trial to test the use of Government Technology Agency’s (GovTech) Sign with Singpass among its retail and corporate customers, which will be used to confirm transactions such as individual wealth planning services and the PayNow Corporate application using a customer’s digital signature, the bank announced on Thursday.

    The features feature enables customers to use Singpass – the digital identity for Singapore residents that is identifiable and uniquely linked to the user – to sign electronic documents digitally via the Singpass app.

    The bank said it is pushing this innovation as research shows that COVID-19 has accelerated the move to online services, with more than 65 percent of customers expecting banking services to be digital by default.

    The change in customer expectations and experience during COVID-19 has made it imperative that we explore and extend our digital capabilities across more of our financial services and products, Susan Hwee, UOB head of group technology and operations, said in the announcement.

    UOB plans to expand the service to include more of its products and services for both the retail and wholesale segments in Singapore, and to expand its electronic signature capability to the region from 2022.

    One benefit from the move to e-signatures is its reduction of paper usage – more than 2 million multi-page hardcopy documents each year, which in turn will save more than 700 trees per year, once rolled out across its markets.

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  • Huawei Eyes Digital Finance Expansion

    Huawei Eyes Digital Finance Expansion

    Huawei is eyeing opportunities in digital finance to diversify its revenue mix amid ongoing U.S. sanction pressure against its smartphone and telecom equipment business.

    Huawei is the latest major Chinese player to make an entry into the global digital finance market, eyeing growth opportunities from Southeast Asia, the Middle East, Latin America, and Africa where financial inclusiveness is underdeveloped.

    Intelligent finance itself has a market valued at several hundreds of billions of dollars, but the potential is bigger because there will be cross-sector opportunities,» said Huawei’s global financial services business unit president Jason Cao in a report.

    Digitalized financial services have already penetrated into various commercial fields, and a cross-industry, full-scenario eco-system can be built by us to serve the clients.

    Huawei will look to leverage various capabilities, including facial recognition and big data technology, to develop innovative solutions.

    It recently formed an alliance with 25 partners including software developers, fintech companies, and risk managers to create an ecosystem of digital financial solutions.

    You do not just offer what financial firms demand in the new era, Cao said. The key to staying ahead is developing innovative scenario-based solutions.

    Huawei will look to be less reliant on its smartphone and telecom equipment business amid ongoing pressure from U.S. sanctions such as export controls to cut access to high-end chip suppliers.

    In addition, Meng Wanzhou, Huawei’s chief financial officer and daughter of founder Ren Zheng Fei, is currently in a legal battle to fight extradition to the U.S. over accusations that she deceived HSBC to bypass sanctions against Iran.

    Meng’s lawyers are scheduled this month to convince a Canada-based judge to allow them to rely on newly discovered evidence that supposedly proves that HSBC was aware of the sanctions risks. The evidence is believed to be sourced from documents in a recent agreement between Meng, Huawei and HSBC which resulted from a court ruling in Hong Kong.

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