Tag: Finance

  • Top UBS Banker Defects

    Top UBS Banker Defects

    Quintet is replenishing its management with a high-profile Dutch banker, in its latest raid on UBS. The Luxembourg-based private bank is hiring Eli Leenaars as its operating chief, it said in a statement on Tuesday. Currently a vice-chairman at UBS, Leennaars is due to replace Colin Price in the job, effective June 1.

    The hire of Leennaars, a prominent Dutch banker, is the latest in a string of high-profile hires from UBS for Quintet. The Qatari-controlled private banking group is seeking a revival of its fortunes under new management stocked heavily with ex-UBS top executives.

    The project was spearheaded by UBS’ ex-private bank head Juerg Zeltner until he died suddenly in March. Now run by Jakob Stott, also an ex-executive of the world’s largest wealth manager, Quintet opened a Swiss bank last year and is in the process of streamlining eight largely autonomous private banks across Europe.

    Leennars, who has kept a low profile since moving to Zurich in 2015, was far more prominent in his 24-year career with ING. He was reportedly ultimately outmaneuvered for the top job in 2013 – by none other than Ralph Hamers, now also in Switzerland. Just ten weeks into Hamers’ tenure as CEO of UBS, Leennaars appears overworking for big companies.

    After decades of service at large organizations, I am eager to put my experience and energy to work at this highly entrepreneurial firm, he said in a statement. The 60-year-old banker was instrumental in the transformation of ING after the 2008/09 crisis, after which Hamers overhauled its aging infrastructure in favor of a so-called agile organization.

  • HSBC Becomes First Foreign Fintech in China

    HSBC Becomes First Foreign Fintech in China

    HSBC furthers its expansion in mainland China with the latest launch of a fintech subsidiary based in Shanghai. The British lender announces the opening of the HSBC Fintech Services (Shanghai) Company Limited, according to a media statement, with an eye to scale up its wealth management business in the mainland.

    We believe technology can help provide better customer services, which can spur the growth of the real economy,» said Mark Wang, president, and chief executive officer for China.

    The opening of HSBC Fintech reflects HSBC’s commitment to investing in mainland China and also our support to developing technology and innovation in the financial world.

    The new entity will initially provide centralized technology and data services to the bank’s mobile financial planning offering in the mainland – HSBC Pinnacle Venture – to target customers outside the branch network. Digital tools introduced will cover financial planning, employee benefits, and wellbeing platforms for through a one-stop platform focused on corporates.

    In the future, HSBC Fintech will gradually expand the scope of its services to cover other HSBC entities.

    Through this corporate platform, we hope to provide dedicated financial services traditionally available only to high net worth customers to corporate employees on a broader basis, creating positive commercial value for companies, and bringing mutual benefits to both companies and employees, added Trista Sun, vice chair of HSBC Insurance Asia Pacific and execute director of HSBC Fintech Company.

  • Standard Chartered Appoints Chief Investment Officer

    Standard Chartered Appoints Chief Investment Officer

    Standard Chartered promotes a 25-year financial markets veteran internally to become its chief investment officer based in Singapore, according to an internal memo.

    Standard Chartered appoints Steve Brice as its new chief investment officer, according to an internal memo, as well as head of the discretionary portfolio management division.

    He will lead 25 investment professionals and chair the bank’s global investment committee which forms cross-asset investment views for the private and retail banking segments.

    A spokesperson for the bank confirmed the appointment.

    Brice is a longstanding Standard Chartered employee, spending 23 of his 25 years in the industry with the bank beginning in 1998. He was previously its Southeast Asia chief economist; head of research for the Middle East and South Asia; and South Africa head of global markets.

    Prior to joining Standard Chartered, he began his financial career with London-based consultant IDEA where he was its regional head of FX for Europe.

  • OCBC Names New CEO as Samuel Tsien Retires

    OCBC Names New CEO as Samuel Tsien Retires

    The banking industry veteran, with 35 years of banking experience, will take the helm from 14 April 2021.

    OCBC has named Helen Wong as the successor for its outgoing chief executive Samuel Tsien, who retires after 14 years at the bank, the firm announced on Friday evening.

    Wong, who rejoined OCBC in January 2020 to lead OCBC’s new wholesale banking unit after starting her career at the bank as a trainee in 1984, was appointed after a rigorous global search, the bank said in the announcement.

    Wong is widely regarded as a top female banker in Hong Kong with deep Greater China experience and extensive market knowledge and is regarded as an expert on the Southeast Asian region.

    She previously spent 27 years at HSBC, where she held various senior management positions in corporate and investment banking, including president and chief executive of HSBC China, head of global banking (Hong Kong), and chief executive of Greater China.

    Tsien, 66, joined OCBC Bank in July 2007 as the global head of global corporate bank and was appointed the group CEO in 2012.

    In his nine years as the Group CEO, Sam has significantly built the OCBC franchise into a much more diversified and resilient business. He has strengthened the risk culture and internal processes, and instilled a set of solid corporate values to guide the team in doing business in a sustainable way, OCBC chairman Ooi Sang Kuang said in an internal memo to staff.

  • The great banking profit paradox of Covid-hit 2020

    The great banking profit paradox of Covid-hit 2020

    Banks made huge profits in 2020 although the economy grew at the slowest rate this decade and 70 percent more companies shut down than in 2019.

    VietinBank, Vietnam’s third largest lender by assets, reported a 40 percent increase in profit. Vietcombank reported profits of around $1 billion, the same as the previous year. Tien Phong Commercial (TPBank) and Vietnam Maritime Commercial Joint Stock Bank saw their profits increase by 11 percent and a scarcely believable 90 percent.

    State-owned VietinBank attributed the jump in profits to a surge in non-interest income and reduction in operation costs.

    Vietcombank said it owed its profits to bancassurance. In the first nine months, profits had been down 17 percent, but they recovered rapidly in the last three months, increasing by 30 percent, to claw back to the previous year’s levels.

    VPBank and Techcombank were two of the most profitable lenders. They have yet to announce full-year figures, but in the first nine months their profits rose by 30 percent and 20 percent, respectively.

    VPBank managed to cut costs while its income remained steady, while Techcombank saw interest income increase by 28 percent and non-interest income by 65 percent.

    They benefited from a particular segment auto loans. The 50 percent cut in car registration fees in the second half of the year sparked a rush to borrow to buy vehicles. VIB’s interest income in the third quarter was up 38 percent, and the fourth quarter saw probably more of the same. Income for the first nine months rose by 30 percent. TPBank’s interest income too rose by almost 30 percent.

    “Banks’ results are not as we expected,” SSI Securities researchers said in a note. They had forecast in April that banks’ profits would fall by 11 percent in 2020, but in the first nine months, they rose by 11 percent.

    They said the rising profits were due to a surge in non-interest income and improvement in net interest margin (NIM).

    For the banks SSI researched, non-interest income was up by 15 percent in the first half and almost 60 percent in the third quarter, with private joint stock banks providing a major boost.

    “Payment services, trade finance, bancassurance, and remittances revived in the third quarter after social distancing in April and May suppressed demand,” SSI said.

    The second quarter saw NIM plunge due to interest rate cuts and loan restructuring, but it recovered in the third quarter, in fact, reaching a three-year peak as deposit interest rates fell sharply and lending interest rates gradually rose back up.

    The third quarter saw a 9 percent rise in interest income and 31 percent increase in non-interest income.

    It is estimated that for the full year banks’ net profits would rise by 10.2 percent, while that of non-financial companies would fall by over 21 percent, financial data company Fiingroup said.

  • UOB Prices Capital Securities Using SORA

    UOB Prices Capital Securities Using SORA

    The bank has become the first issuer to reference the Singapore Overnight Rate Average Overnight Indexed Swap (SORA-OIS) rate for a capital security.

    The reset coupon rate of UOB’s perpetual, non-call five-year additional Tier 1 (AT1) securities on the first call date will reference the five-year SORA-OIS rate, instead of the five-year Swap Offer Rate (SOR) interest rate swap that had been the benchmark reference rate in the market, the bank said in a statement on Friday.

    The issuance will further encourage the use of the new benchmark rate for pricing in the Singapore dollar bond market as part of broader industry efforts to develop deep and robust SORA-based cash and derivative markets, UOB said.

    Priced at a coupon of 2.25 percent per annum, 181 basis points above the prevailing five-year SORA-OIS as at 7 January 2021, UOB’s latest AT1 securities with a transaction size of S$150 million ($113.26 million) were subscribed by high-net-worth and institutional investors. If the bonds are not redeemed in 2026, the coupon will be reset based on 181 basis points above the five-year SORA-OIS on the first call date.

    The transition from SOR and SIBOR to SORA, a transaction-based interest rate benchmark underpinned by the SGD overnight interbank funding market, is aligned with the development that risk-free rates are being used across the global markets as new benchmark rates for financial markets.

    As the industry progresses on the transition to SORA, we will continue to step up our efforts and play our part in expanding the use of SORA across more financial products, Lee Wai Fai, UOB chief financial officer, said in the statement.

  • APAC Investment Banking Fees Break Records Amid Pandemic

    APAC Investment Banking Fees Break Records Amid Pandemic

    Investment banking fees in the Asia Pacific ex-Japan region rose to reach record-highs in 2020, driven most notably by a surge in Chinese capital markets.

    Asia ex-Japan investment banking fees reached $28.5 billion in 2020, a 23.4 percent increase, according to Refinitiv data.

    This marks an all-time high in annual fees earned since Refiniv began collecting such data in 2000 and also the first time the region surpassed European fees.

    The most notable record broken was in debt capital markets which saw proceeds from APAC-domiciled issuers reach $3.1 trillion – a first time ever the $3 trillion mark was broken since Refinitv started keeping records in the 1970s.

    This represents a 23.3 percent increase, breaking last year’s record of $2.5 trillion, with China making up the lion’s share at around $2.3 trillion.

    The most notable surge was from equity capital markets which saw $409.9 billion of funds raised (up 66.5 percent) – surpassing the last all-time high of $342.5 billion in 2010 – while issuances grew 40.2 percent.

    China once again dominated as the top issuing country, raising over $275 billion in funds, while industrials was the leading sector with a 185 percent year-on-year spike.

    Mergers and acquisition activities also saw a robust climb of 10.3 percent to $1 trillion after activity in the second half of 2020 rebounded 85.5 percent and 24.1 percent in value and deal number, respectively.

  • VietinBank reports record profit

    VietinBank reports record profit

    VietinBank, Vietnam’s third largest lender by assets, has reported a 40 percent increase in standalone profits in 2020 to VND16.5 trillion ($715 million).

    This is its highest ever profit, and chairman Le Duc Tho, speaking at a meeting on Wednesday, attributed it to a surge in non-interest income and reduction in operation costs.

    While it has not published its financial statement for the year, the bank said in a press release that consolidated debts rose by 7.7 percent and non-performing loans were less than 1 percent.

    Its non-interest income jumped 35 percent, lifting it as a ratio of total income from 16.5 percent in 2019 to 20 percent.

    Income from services, foreign exchange trading and treasury operations increased by 12 percent, 24 percent and 70 percent.

    The bank targets 8-11 percent credit growth in 2021 and 10-20 percent growth in standalone profit and consolidated profit, and keeping non-performing loans to under 2 percent.

  • DBS Opens Tech Academy in Upskilling Drive

    DBS Opens Tech Academy in Upskilling Drive

    The bank has launched an in-house digital training institute to equip its 5,000-strong technology workforce with cutting-edge skills for the future.

    The Future Tech Academy covers three technology disciplines: Site Reliability Engineering, Data Processing and Analytics, and Application Security, with more programs to be added over the next year.

    Having our own DBS Future Tech Academy gives us the agility to adapt our training curricula according to the bank’s needs and enables us to stay ahead of the massive changes around us, Jimmy Ng, DBS group chief information officer, said.

    The curriculum DBS is offering incorporates a blended pedagogical approach tapping on both external experts as well as internally developed content and certifications.

    DBS believes that this will enable employees to acquire the latest technology skillsets from external industry experts and immediately apply their new skills to relevant technology projects being rolled out by the bank, it said in a statement on Thursday.

    Growing the Talent Pool

    UOB and Standard Chartered have also previously launched programs to train their staff to adapt to the digital era, with the latter launching a learning hub in Singapore in December 2020 to boost the job readiness, career prospects and future competitiveness of its Singapore workforce.

    Growing the pool of technology talent in Singapore will place the country in good stead as we respond to the disruptions ahead, Ng said.

  • More Account Suspensions for Exiled Hong Kong Dissident

    More Account Suspensions for Exiled Hong Kong Dissident

    Self-exiled Hong Kong dissident Ted Hui, who was recently spotlighted over frozen accounts at HSBC, has faced even more pressure from the British lender which allegedly canceled credit cards and «unlawfully embezzled» his funds without explanation.

    Ted Hui Chi-fung claimed that HSBC had not only canceled credit card accounts belonging to him and his family but frozen funds within it that resulted from refunded purchases.

    On the credit cards of both my family and myself, as a result of consumption refunds, the credit is more than the debit,» he said on his social media account. «The balances (around a few tens of thousands of Hong Kong dollars) are all private property protected by Hong Kong’s Basic Law. They are now unlawfully embezzled by HSBC without any explanation.

    While Hui’s claims about frozen funds could potentially be contentious, banks routinely assess and close accounts based on legal and compliance risk, especially with regards to politically exposed persons (PEPs).

    This is not the first time Hui has had his accounts frozen after similar moves were made against him and his family’s HSBC Premier accounts in December. At the time, local police issued an official statement confirming it had directed the account suspension over a money laundering and national security law probe.

    Although Hui’s claims that the latest credit card account cancellations were not requested by the police, an HSBC statement indicated otherwise.

    «We have to abide by the laws of the jurisdiction in which we operate and this case is no different,» according to an HSBC spokesperson who said further inquiries should be directed to law enforcement.

  • Crypto Rumbles Central Bank Sovereignty

    Crypto Rumbles Central Bank Sovereignty

    The private sector has long driven innovation on digital currencies but as fintech’s plans became more powerful, central banks sprang to attention. Their main concern? Keeping monetary policy in their purview.

    The most tantalizing tales in cryptocurrencies this year weren’t written by Libra or bitcoin, but by national or supranational projects like the digital euro. While investors raced to get in on bitcoin’s record-smashing highs, the government projects warrant a closer look.

    What central banks are trying to do is replace the storage carrier of money with a new one – cloud instead of long-play (LP), so to speak. The aim is to kill several birds with one stone.

    The first is to stave off a private sector-led attack on central bank sovereignty. The second is enabling efficiencies in the financial system, and the third is to lay a foundation for seamless oversight of monetary transactions.

    Taken in turn: a central bank ensures financial stability while overseeing systemically-relevant market infrastructure. To hand over a central instrument in its arsenal is to jeopardize its own mandate. Replacing a country’s own currency with another – which frequently happens in unstable countries, where dollars effectively become the leading currency – is a good example, or when a privately-controlled alternative takes over for reasons of efficiency.

    Admittedly, crypto is far from this scenario, but the thought experiment is a worthwhile one. We need to assume that multinational companies like Amazon or Alibaba will in future control and executive an enormous portion of private consumption: they own the value chain, from manufacturer to end consumer. They are intimately familiar with customer needs and aren’t shy about cultivating the data with the help of artificial intelligence.

    The next logical step in cementing this position is to introduce their own currency. This would dramatically simplify the purchasing process as well as create a vast common currency area spanning producer, commercial dealer, suppliers, to consumers.

    None of this is a problem as long as employees are paid in U.S. dollars, euros, or krona and use a major currency to buy a trading one. But if they are, for example, partly paid in Amazonas or Alibabas, central banks cede part of their authority to the private sector. The initial hostile official response to Libra is the logical consequence of this.

    The Swiss central bank’s «Project Helvetia» as part of the BIS’ innovation hub sidesteps the first question in favor of tackling the second, central digital revolution issue. Traditional banks are still grappling with the conversion to digital banking: continually under siege from newer upstarts without any historical baggage and far zippier organizations.

    The Swiss National Bank’s digital franc is meant to enable efficiency gains and simplify monetary transactions. This is a much more defensive strategy than other central banks have elected – notably the European Central Bank, Sweden’s Riksbank, or the People’s Bank of China – but the pragmatic approach fits the Swiss system of thinking well.

    In lockstep with infrastructure provider SIX, which belongs to the banks, genuine and measurable advances would represent a great step towards a digital future. The Swiss stock exchange operator plans to go live with its digital asset trading venue, SDX, next year. A digital Swiss franc would suit the SNB’s financial intermediaries perfectly.

    Switzerland is hardly ready for the third and conclusive step: a digital version of cash is being actively discussed elsewhere (namely in Sweden and China). Some aspects of digital money – efficiency versus cash and crucially, the traceability of transactions – are too tempting to resist.

    Of course, all types of criminals could be disrupted in their activities with such a step. But the accompanying supervision of citizens contradicts Switzerland’s understanding of government and privacy – and should be rejected. The complete replacement of cash in Europe and the U.S. isn’t on the horizon either for the same reasons, even if digital money eventually will find a niche besides paper.

    Despite the rapid advancement of the topic in recent months, we’re still at the dawn of developments. 2021 is sure to bring promising new developments, and the ECB is likely to devote considerable resources to rolling out a digital euro (or ultimately spike the project).

    In Switzerland, SDX and «Project Helvetia» are poised to take their next steps. The U.S. has been noticeably absent in the discussion, though January’s change in administration may mark a new tack in digital assets.

  • Goldman Sachs Proffers Affluent Wealth App

    Goldman Sachs Proffers Affluent Wealth App

    The U.S. investment bank plans to expand its wealth offering to affluent clients. The move represents a further departure from its Wall Street roots.

    Goldman Sachs, the best-known investment bank in the world, is pushing deeper into mass-market banking. Four years after launching Marcus for retail clients, the New York-based company is now releasing an app for affluent clients to invest, according to a report by CNBC which cites an internal memo.

    A beta version of the app – Marcus Invest – has already started and a wider launch is planned for the first quarter. Employees are the first to test Marcus Invest, which charges an annual fee of 0.15 percent of assets.

    The move is emblematic of how Goldman, known as Wall Street’s most voracious trading house, is quietly seeking a reinvention as a trusted wealth manager under CEO David Solomon. Though still minute in comparison to its investment banking activities, the wealth arm has steadily expanded in recent years – including returning to the world’s largest offshore center.

    Goldman’s entrance into the mass affluent market was foreshadowed by Marcus, which it launched in 2016 in the U.S. and expanded to the U.K. two years ago. Marcus was so successful in hoovering up British money that Goldman reportedly shut it to new clients this year. The app was meant to be launched in Germany as well, a move which was pushed back due to Brexit as well as the pandemic.

    Until recently, Goldman’s wealth managers catered only to the wealthiest of clients and those who also commanded investment banking-grade services (generally from $25 million in assets and up).

    Unlike traditional wealth managers, Goldman is making technology a backbone of its efforts to court the wealthy – plowing billions into its own development as well as into deals. It bought United Capital, a tech-backed wealth manager, last May, but has been quietly acquiring consumer banks and wealth managers since 2016.

  • Lender MSB expects to earn hundreds of millions from insurance deal

    Lender MSB expects to earn hundreds of millions from insurance deal

    Vietnam Maritime Commercial Joint Stock Bank is set to sign an exclusive bancassurance deal with a leading but unidentified insurer worth hundreds of millions of dollars to it.

    It will be signed next year for 15 years with one of the three biggest insurers in terms of market share in Vietnam, Nguyen Hoang Linh, CEO of the lender (MSB), said at a meeting on Wednesday.

    The country’s three biggest are Canada’s Manulife, the U.K.’s company Prudential and Japan’s Dai-ichi Life.

    Linh cited the example of Asia Commercial Bank (ACB) to indicate roughly how much MSB would receive in upfront payment for the deal.

    ACB received $370 million from Canada’s Sun Life.

    Linh said ACB has a monthly premium income of VND80 billion ($3.45 million), while that figure of MSB is VND50 billion.

    The Ho Chi Minh City Stock Exchange this month gave approval for MSB to list its shares on December 23 at a price of VND15,000, which will put its market cap at VND17.6 trillion.

    The bank has forecast a pre-tax profit of VND2.3-2.4 trillion this year, up 4.5 percent from last year.

  • Singtel to Expand Mobile Financial Services Offerings

    Singtel to Expand Mobile Financial Services Offerings

    The robo-adviser, in partnership with UOB Asset Management, is expected to launch by the first half of 2021.

    Singtel and UOB Asset Management have signed an agreement to launch a robo-advisor to make digital investments more accessible to users of Singtel’s Dash mobile wallet, according to a joint announcement on Monday.

    The partnership paves the way for Dash to make its foray into wealth management and furthers its goals of digital and financial inclusion by expanding the app’s range of mobile financial services offerings, the announcement said. Dash customers will be able to invest in a portfolio of Exchange Traded Funds (ETFs), managed funds and/or other asset classes within the Dash app.

    The two sides will also explore opportunities to offer robo-advisory and other investment solutions through Singtel’s associates in the region, given the extensive presence of both companies in Asia including Indonesia and Thailand.

    We aim to democratize access to digital investments for our customers who value simplicity, affordability and convenience when managing their finances on a digital platform, Arthur Lang, Singtel International Group CEO, who noted the growing interest in online investing among its users.

    With over 1 million registered users, Dash is among the largest non-bank mobile wallets in Singapore. Since its launch in 2014, the app has expanded beyond payments and mobile remittance to include lifestyle services like restaurant bookings and insurance.

    Singtel, as part of a consortium with Grab, is one of two recipients of a full digital bank license from the Monetary Authority of Singapore. The consortium aims to formally launch the digital bank in early 2022.

  • Standard Chartered Receives Enhanced Privileges in Singapore

    Standard Chartered Receives Enhanced Privileges in Singapore

    The recognition comes on the back of the U.K.-Singapore Free Trade Agreement, signed on Thursday.

    The Monetary Authority of Singapore (MAS) has granted Standard Chartered Bank (Singapore) enhanced Significantly Rooted Foreign Bank (SRFB) privileges, in recognition of the significantly higher degree of rootedness that exceeds the SRFB baseline criteria.

    As part of the U.K.-Singapore FTA, Standard Chartered will be entitled to additional customer service locations on top of the 50 it is entitled to as an SRFB.

    The enhanced SRFB privileges also give Standard Chartered the opportunity to secure an additional full bank license to establish a subsidiary to operate new or alternative business models such as a digital-led bank with ecosystem partners, which it has been planning as part of a joint venture with National Trade Union Congress (NTUC) Enterprise.

    Standard Chartered’s roots in Singapore trace back over 160 years when it set up its first branch in 1859 under its former name, Chartered Bank of India, Australia and China.

    Singapore is now the group’s operational hub, housing global businesses, technology and operations, and many of the bank’s leadership teams. The country is also home to SC Ventures, the bank’s innovation, ventures and fintech investments unit. The bank also plans to grow its international wealth business in Singapore and has invested S$8 million to train and upskill its workforce in the city-state.

    We have invested and grown in Singapore to be the global business and operations hub that we are today, and we look forward to playing our part in developing the country’s banking landscape, Bill Winters, Standard Chartered group chief executive, said in a statement.