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Tag: Finance

  • Ant Financial Eyeing Singapore’s Digital Bank Licences

    Ant Financial Eyeing Singapore’s Digital Bank Licences

    Jack Ma’s Ant Financial Services may apply for a virtual banking license in Singapore, potentially making a splash in the regional banking landscape.

    Ant Financial Services is the latest contender to enter the race for a digital banking license. Up to two licenses are on offer for full digital banks, while another three are on offer for wholesale banks. The firm did not disclose whether it will seek a retail or wholesale license.

    We are actively looking into this opportunity,” said Ant Financial, who was quoted in a report. Ant’s payments app Alipay and its local e-wallet partners had about 900 million annual active users in China and 1.2 billion globally as of June, according to Bloomberg Intelligence.

    Singapore’s move to open up the banking industry to technology companies follows in the footsteps of Hong Kong, where Ant has obtained a license. So far, OCBC has agreed to join peer-to-peer lender Validus Capital and Temasek Holdings’ venture capital arm to apply for a wholesale license before the year-end application deadline.

    South-east Asia’s digital lending market is expected to more than quadruple to US$110 billion by 2025, according to a report by Bain & Co, Google, and Temasek Holdings.

  • OCBC Targets 200 Homegrown Cyber Risk and Security Staff

    OCBC Targets 200 Homegrown Cyber Risk and Security Staff

    OCBC is partnering with Temasek Polytechnic in an effort to train up to 200 employees to become cyber risk analysts and cybersecurity specialists in the next three years.

    The bank and higher education institution will launch a cyber certification program focused on four main areas: digital services and solutions, software development, risk and assurance, and security operations and monitoring. OCBC collaboration with lecturers of Temasek Poly’s School of Informatics and IT will also cover subject matters such as risk management, audit, and cybersecurity.

    At OCBC, we strongly believe that people will be the most important line of defense against potential threats, said Vincent Choo, OCBC’s head of group risk management. The bank takes great efforts to ensure that our people are aware of and trained to deal with existing and emerging risks.

    The certification is part of OCBC’s Future Smart program, a $20 million initiative to upgrade internal talent. In July 2019, OCBC also partnered with Ngee Ann Polytechnic to create a data certification program to train 200 data science and analysts over the next three years in order to double the number of such talents.

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  • DBS Partners with Exiger to Fight Financial Crime

    DBS Partners with Exiger to Fight Financial Crime

    To fend off the evolving risks of financial crime, DBS Bank has partnered with Exiger, a provider of risk and compliance solutions to implement a due diligence solution powered by artificial intelligence (AI) to streamline and further bolster the bank’s screening processes.

    DBS will be tapping on DDIQ, the automated AI-powered solution designed by Exiger that understands and analyses content with cognitive reasoning. The solution accelerates and enhances risk assessments of clients, investments, transactions, third parties, and counterparties.

    Using AI to help manage risk in financial crime is a journey that involves many small, difficult steps but tremendous ambition and commitment to keep moving.  It is incumbent for financial institutions and their like-minded partners to continue to strive to give customers great experiences yet be adversarial to criminals and terrorists,» said Lam Chee Kin, Managing Director and Head, Group Legal, Compliance and Secretariat at DBS Bank in a media statement on Friday.

    Findings from each level of risk assessment are recorded in Exiger’s platform in a transparent and concise manner to ease the process of manually extracting and collating data for audit, compliance, and regulatory purposes.

    Banks are quickly recognizing that legacy systems and legacy technology will hold them back from achieving the next phase of growth and meeting increasingly demanding regulatory compliance requirements. DBS is cutting the path for traditional financial institutions to transform and compete in today’s digital market, commented Brandon Daniels, President of Global Technology Markets at Exiger.

    Exiger has developed purpose-built technology – DDIQ and Insight 3PM – to accelerate the suitability, efficiency, quality and cost-effectiveness of clients’ compliance operations. Exiger operates in six countries and eight cities around the world, including London, New York City, the Washington, D.C. metro area, Toronto, Vancouver, Bucharest, Hong Kong and Singapore.

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  • HSBC, No Virtual Bank License Required for Digital Supremacy

    HSBC, No Virtual Bank License Required for Digital Supremacy

    HSBC continues to ramp up its digital investments and developments, claiming that a virtual banking license is not necessary for virtual banking supremacy.

    The bank has globally spent $2.2 billion on growth and digital enhancements in the first half of 2019, a 17 percent year-on-year increase. Although it is cutting global headcount, digital talent remains in demand for the bank which hired 1,000 staff for related teams in Hong Kong and the broader Asia Pacific region.

    Despite its digital developments, HSBC has not pursued a virtual banking license and it insists that there is no need.

    HSBC has invested significantly in its digital banking platforms, said Andrew Eldon, HSBC’s Hong Kong head of digital banking, in an SCMP report. There is nothing a virtual bank can do which we cannot offer. We do not believe we must have a virtual bank license to operate digital banking services.

    HSBC is very keen on investment in our digital platform and talent,» reiterated Andrew Connell, the bank’s global head of partnership development and innovation, retail banking and wealth management, citing the success of the PayMe app and a high rate of transactions executed through digital platforms at 90 percent.

    The bank is also placing emphasis on artificial intelligence and robotics to further improve efficiency. It currently has 1,600 robotic devices globally that processed 11.5 million transactions last year, a tenfold increase from 2017, with success stories in mortgage loan applications in Canada (speed up from 22 days to 1 day) and credit card approvals in Hong Kong (from 6 days to 1 day).

    AI is an important area for us to invest in. Banking services that adopt AI technology can be quicker and more accurate than through traditional processes,» Connell said.

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  • Gamified Banking in Thailand Driving Clients Inflows

    Gamified Banking in Thailand Driving Clients Inflows

    Gamification within Thai banking has proven to be a hit for fintech firm Meniga, which has seen the concept flourish enough to drive clients to top up savings to increase their «level».

    Meniga is focused on developing white-labeled digital user experiences focused on leveraging the power of analytics and transaction data.

    According to Meniga’s APAC head of sales, Kanika Mittal, it had partnered with a Thai financier to power an app that gamified deposits by «leveling up» customers as they saved more in a way akin to popular games like Age of Empire, where users build and upgrade their civilizations.

    When they begin, they are on level one. As they save more they can build a village before upgrading to a town, city and super city, Mittal explained. «The app has a total of 74 levels and it has proven so popular that customers called to increase the savings limit per day to advance.

    A key prerequisite for unlocking the value of transaction data for individual customers is aggregation. While the technology undoubtedly exists, an ecosystem needs to be formed and, in particular, regulations need to be in place to drive industry growth and form trust in the market.

    It is critical to provide consumers and market players a sense of security and safety when such personal data is being shared across banks,» she explained. «That is why regulations play a key role. If it is an organic market for open banking, there will always be hesitation for open banking that is not backed by a regulatory authority.

    Meniga was founded in Iceland within the ruins of the financial crisis when the nation had already seen the worst with three of the top four banks having collapsed. Out of all this chaos, the firm sought to raise awareness about how to manage finances better, not only due to the evident demand for such insights or expertise, but also because «it is the socially responsible thing to do,» Mittal said.

    Proof of its commitment to the value of social responsibility, the firm recently partnered with UN Climate Change to provide customers with data and insights about their impact to the environment. The partnership developed methods to calculate the carbon footprint of users entirely based on their transaction data and the type of products and services consumed.

    Such developments are win-win scenarios,» she added. «That is part of the fabric of this company, based on our roots, and we believe in it.

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  • CEO of SCB Julius Baer Resigns

    CEO of SCB Julius Baer Resigns

    The chief executive of SCB Julius Baer has left the role less than seven months into the appointment.

    Jiralawan Tangitvet, the CEO of SCB-Julius Baer, has resigned, according to a report in the Asian Private Banker. He was looking to make the newly-formed entity, a joint venture between Siam Commercial Bank and the Swiss bank, become a powerhouse in Thailand’s nascent private equity management sector.

    Tangitvet has joined the joint venture entity in April as its CEO this April. She was previously from Kasikorn Securities, where she was its managing director. Both banks could not be reached for comment at the time of this report.

    In June, SCB Julius Baer released its inaugural edition of the Wealth Report Thailand, which report focuses on the wealth management landscape in Thailand.

  • UBS Eyes C-Suite Rejuvenation

    UBS Eyes C-Suite Rejuvenation

    Long-standing UBS CEO Sergio Ermotti is expected to rejuvenate his top management before his exit.

    CEO Sergio Ermotti defused the pressure cooker this summer: Hiring Credit Suisse’s Iqbal Khan to run UBS’ $2.1 trillion private bank, together with Tom Naratil, took the immediate sting out of questions on Ermotti’s future.

    What Ermotti hasn’t done is refresh his top management, where the average age is 56 years old. In the next 12 to 18 months, the long-standing CEO is expected to lift several younger bankers into top management around him.

    The move isn’t surprising per se: CEOs like to «put their house in order» before leaving. The move is likely to sweep out anyone who is older than Ermotti, who is 59. That puts Finance Chief Kirt Gardner and Swiss boss Axel Lehmann, who turned 60 this year, and top lawyer Markus Diethelm, 62, in focus.

    Diethelm may enjoy a grace period until UBS can bury a messy French criminal probe of which he has overseen the defense. UBS didn’t comment on potential top management changes, and all three men declined to comment through a UBS spokesman.

    The gentle clear-out provides an opening for a layer of top executives directly under Ermotti who are chomping at the bit. Some – like wealth executive Christine Novakovic – have already made an open play for a seat at the table.

    Others are less well-known in Europe: Jason Chandler, who runs UBS’ American wealth arm, is viewed favorably in Zurich. So is Beatriz Martin, an acolyte of former investment bank head Andrea Orcel who has flourished since his departure more than one year ago.

    Following the exit of Orcel last year, Martin lobbied for a bigger role – and won one. The Spanish-born banker added U.K. CEO to her remit of operating chief at UBS’ investment bank. Top finance executive Angus Graham, while little-known, is another candidate, particularly for Gardner’s job.

    Besides Martin, several women are emerging as top contenders for more: veteran investment banker Ros L’Esperence, sidelined by Orcel but recently reinstated in a big job as global banking co-head (together with Javier Oficialdegui) is one.

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  • DBS Avoids Larger M&A Deals

    DBS Avoids Larger M&A Deals

    DBS group chief executive Piyush Gupta said it would avoid acquisition targets with large deal sizes in order to maintain concentrated focus on its digital transformation.

    According to Gupta, the bank would target deals valued at about five percent of DBS’s market cap (around $3.7 billion as of publishing) and avoid larger ones in order to focus on a digital market he calls «the battleground of the future».

    The general thesis for us is that we still think that the digital transformation requires energy and bandwidth,» he explained. If I did a bigger deal and I wound up saying that I’m going to lose two years’ worth of tech work that would be quite a cost to pay.

    Piyush reiterated that the bank remained open to acquisitions but noted that the size preference was due a successful track record of «very quick returns» via digital integration, referencing the bank’s $81 million purchase of ANZ’s Asian wealth and retail business in 2016.

    We realized that if you get a core customer base at a sensible price, and then overlay our digital capabilities and tools on top of that, it can actually be very accretive, very quickly,» Gupta said. «So we are open to exploring those, but again, it’s a fine call. When does it become too big – one that is going to subsume everything else?

    One such financial institution which may qualify for the bank’s taste is Indonesia’s Bank Permata, valued at around $2.7 billion, in which DBS has reportedly expressed interest. Currently, Japan’s SMFG and Singaporean rival OCBC are believed to be frontrunners for the medium-sized lender.

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  • DBS and OCBC Collaborate With Google Pay

    DBS and OCBC Collaborate With Google Pay

    DBS and OCBC account holders without credit cards can soon use Google Pay to make payments to merchants in Singapore.

    The integration will allow both banks’ customers to send and receive funds and also pay merchants via Google Pay using a single-click sign-up.

    We believe that integrating Google Pay with our DBS PayLah! the platform will deliver greater convenience to consumers as they will have more options to transfer funds and make instant payments to some 80,000 merchants in Singapore, said Han Kwee Juan, Chief Strategy Officer at DBS Bank in a media statement.

    The U.S. technology giant on Monday demonstrated a preview of Google Pay in Singapore at the Singapore Fintech Festival 2019, promising features of simplicity, security and helpfulness for users. It taps on conversations of users to create suggestions and also tokenized cards within Google Pay.

    The new service is being tested early next year with the aim of rolling it out in full later in the year, said Hannia Zia, product manager of Google Pay during the preview at the festival. The collaboration includes the integration of both peer-to-peer (P2P) and peer-to-merchant (P2M) transaction services.

    As Google Pay is tapping onto Funds Transfer Services PayNow, customers of nine banks on the payment infrastructure may also enjoy Google Pay later. PayNow allows users in Singapore to make and receive payments from their bank accounts using their mobile or identification number.

    The potential of Google Pay leveraging PayNow is tremendous and will provide our customers with the benefits of secure, seamless and ubiquitous payments without having a wallet. Both OCBC and Google share the same customer-centric approach to enabling seamless digital payments – an open-loop payments ecosystem, said Ching Wei Hong, Chief Operating Officer at OCBC Bank in a media statement.

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  • Singapore Fintech Partners Visa for Instant Remittances

    Singapore Fintech Partners Visa for Instant Remittances

    The partnership, using Visa’s push payment solution and secure network, allows consumers to transfer money in a faster, convenient and more secure way.

    Singapore cross-border fund transfer startup Nium is partnering with Visa to enable instant money transfers into recipients’ bank accounts through their 16-digit Visa debit card numbers, the firm announced in a press release on Monday.

    Designed for both peer-to-peer and business-to-business transfers, the rollout of the service currently covers remittances to Southeast Asian markets like Indonesia, Malaysia, Thailand, Vietnam and the Philippines.

    We understand that individuals’ and businesses’ need to receive money quickly, especially in markets where there are no instant payment solutions like FAST or IMPS, Prajit Nanu, Nium co-founder and CEO, said in the statement.

    Nium, formerly known as InstaReM, recently nixed plans to pursue a digital wholesale banking license, saying it would focus its efforts on its global business-to-business payments instead.

    The firm is part of Visa’s Fintech Fast Track program, which facilitates fintech partners to build and deliver new commerce experiences on Visa’s payments network.

  • UBS: Billionaire-Controlled Stocks Outperform

    UBS: Billionaire-Controlled Stocks Outperform

    Listed firms controlled by billionaires outperformed the broader market with such entities in Asia leading the pack in relative gains.

    In the past 15 years to 2018-end, billionaire-controlled listed companies posted equity returns of 17.8 percent compared to 9.1 percent for the MSCI benchmark in the same period. By region, Asia Pacific ranked second in demonstrating this trend delivering annualized average returns of 18.3 percent – just 0.1 percent behind the first-ranked Americas.

    According to a report co-published by UBS and PwC, the outperformance can be attributed to what it called the billionaire effect or the tendency for self-made entrepreneurs for smart risk appetite and longer-term planning.

    Political uncertainty and economic volatility led global wealth to dip 4.3 percent and Asia was not immune, registering a $217.6 billion wealth drop and a decrease of billionaires by 7.4 percent to 754.

    Still, the region boasted a quadrupling of billionaire wealth in the last five years and unsurprisingly, China led the regional ranks with 325 billionaires. Interestingly, the region was also a significant contributor to female billionaire wealth, which grew by a quarter to $871.2 billion globally, with the number of billionaires doubling over the last five years.

    Entrepreneurs, which account for 70 percent of our client base in Asia Pacific, has been the driving force of the rapid wealth creation in the region, said Amy Lo, co-head wealth management Asia Pacific at UBS Global Wealth Management.

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  • DBS Launches Virtual Wealth Manager With Celebrities

    DBS Launches Virtual Wealth Manager With Celebrities

    DBS introduced its fully virtual wealth management capabilities in Hong Kong in grand fashion, accompanying the launch with renowned local celebrities.

    The bank recently launched its new virtual wealth manager which can enable users to undergo the entire experience digitally from account-opening to transacting. The suite of capabilities also includes general banking, investments, FX trading, remittance and others.

    We are the first bank that has a fully digitized journey from onboarding to all wealth management products, said Sebastian Paredes, DBS Hong Kong CEO. This is not an app. This is the launch of a new virtual bank.

    Then DBS began its planning exercise two years ago to launch the virtual solution, it wanted to significantly reduce the time required to open accounts, after repeatedly hearing clients express how busy they are and how laborious it is to fill out application forms.

    This is something on our mind for a long time,» explained Ajay Mathur, managing director and head of consumer bank gin and wealth management, DBS. With this fully virtual wealth management account onboarding, you can open an account in just a few minutes.

    Joined by renowned local celebrities, Louis Koo Tin-lok and Jessica Hsuan, the bank made a live demonstration to showcase the ease of opening an account. In addition to mandatory documents, the system was able to use facial recognition technology to verify the user simply by matching an image of an official ID and a selfie image.

  • Vietcombank to pull out of BNP Paribas insurance joint venture

    Vietcombank to pull out of BNP Paribas insurance joint venture

    Vietcombank is selling its stake in a JV with French life insurance firm BNP Paribas as part of a possible bancassurance deal with a foreign buyer.

    Its board of directors passed a resolution approving the divestment of an unspecified stake in Vietcombank – Cardiff Life Insurance Co., Ltd (VCLI), the state-owned lender said in a release last Thursday.

    VCLI is a 45:55 joint venture between Vietcombank, Vietnam’s largest lender by market capitalization, and BNP Paribas Cardif, part of France’s BNP Paribas banking group.

    Although Vietcombank’s announcement did not identify a buyer, Bloomberg reported in late September that Hong Kong-based insurer FWD Group Ltd. was nearing an agreement to pay around $400 million for VCLI as part of a long-term bancassurance agreement with the bank.

    A bancassurance transaction is typically an arrangement between a bank and an insurance company in which the latter pays an upfront amount for exclusive rights to sell its products to the bank’s clientele.

    FWD Group, owned by Hong Kong billionaire Richard Li, had outbid several firms, including British insurance giant Prudential, which had been vying to obtain exclusive rights to distribute life insurance products through Vietcombank’s branch network, Bloomberg quoted sources as saying.

    According to VCLI’s latest financial statements, as of the end of 2017 it had VND950 billion ($40.79 million) in assets and accumulated losses of nearly VND3 billion ($128,800).

    Recently major international life insurance companies have been expressing interest in entering the growing Vietnamese market through bancassurance and acquisition deals.

    German insurer Allianz and Japanese insurers Nippon Life and MS&AD Insurance were among several vying to buy the Singapore and Vietnam businesses of Britain’s Aviva in a deal estimated to be worth $2-2.5 billion.

    Earlier Prudential had signed an agreement with South Korea’s Shinhan Bank Vietnam to distribute its insurance products through its network and Canada’s Manulife struck a similar deal with local lender ACB.

    Phung Ngoc Khanh, general director of the Insurance Supervisory Authority (ISA), said the country’s insurance market has huge potential due to the low penetration and people’s rising incomes and awareness.

    In the first half of this year the industry’s premium income was VND71.15 trillion ($3.06 billion), up 24.4 percent year-on-year. Last year’s growth was also around 24 percent, according to the ISA.

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  • OCBC 3Q Core Profit Up Slightly

    OCBC 3Q Core Profit Up Slightly

    Singapore’s second-largest lender reported core net profit of S$1.26 billion in the third quarter, slightly above the $1.25 billion reported a year earlier.

    However, OCBC Bank’s headline net profit slipped 6 percent to S$1.17 billion for its third quarter ended September 30, from S$1.25 billion a year ago due to a one-off charge at its Indonesian banking unit.

    The one-time charge of S$91 million arose as a result of refining the group’s expected credit loss modeling approach for Bank OCBC NISP. Excluding the one-time charge, the group’s core net profit of S$1.26 billion is slightly higher than $1.25 billion a year earlier.

    Loans rose year-on-year and fee income climbed to a record high led by wealth management as the private banking business managed to maintain net new money inflows, said OCBC chief executive Samuel Tsien in a statement.

    Net fees and commissions grew 10 percent to a new record of S$550 million from S$502 million a year ago, led by higher fees from wealth management, investment banking and remittance services.

    Net interest income for the quarter grew 6 percent to S$1.60 billion, stemming from a five basis point increase in net interest margin to 1.77 percent. Improved asset yields and a 2 percent increase in customer loans underpinned the improved net interest income.

    Non-interest income for the quarter increased 2 percent to S$1.06 billion from S$1.04 billion in the previous year. Total income for the quarter rose 4 percent to S$2.66 billion from S$2.54 billion a year ago.

    Not all sections of the bank’s results slip are glowing – net trading income was only S$182 million compared to S$213 million a year ago, as a decline in treasury income offset a rise in customer-related flow income.

    Global and regional economic growth continued to slow, and geo-political event risks have increased. We shall remain vigilant and will maintain prudent risk management practices while exercising disciplined cost management, Tsien said.

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  • OCBC Allows Instant Account Opening For Startups

    OCBC Allows Instant Account Opening For Startups

    Start-ups are now able to open an OCBC business banking account in Singapore immediately after incorporation, rather than having to wait one day. Once a business is incorporated, OCBC Bank can validate the start-up’s business profile issued by the Accounting and Corporate Regulatory Authority (ACRA). This is made possible due to an Application Programming Interface (API) between OCBC Bank and global information services provider, Experian (formerly known as DP Information).

    Banks play a key role in the start-up and SME ecosystem partly because the bank account is at the center of business operations. Given this role and our standing as banker to more than 1 in 2 SMEs in Singapore, we are in the best position to strengthen the connections among all players in this ecosystem, said Christie Chu, Head of Emerging Business and Commercial Banking Cash, OCBC Bank in a media statement on Monday.

    OCBC Bank launched a dedicated business supporting the start-up segment at the end of 2018. Since then, it has been engaging start-ups to understand the pain points when starting a business. With a track record of serving the start-up segment, the bank found that starting a business is a journey of discovery, and many stumble along the way.

    To that end, the team is putting together a start-up guide, with practical tips from successful entrepreneurs with first-hand experience. The guide will be accessible to all aspiring entrepreneurs on OCBC Bank’s website.

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