In May 2017, Moody's Investors Service changed its outlook for Singapore banks to stable, based on their improving growth conditions and steadying commodity prices. We discover how one of the homegrown banks, UOB, has been growing its business as one of the leading Asian banks.
The changing global environment
Not many would argue that the economic rise of Asia has become more prominent over the last few decades. Economic gravity started to shift to Asia in tandem with China’s ascent in importance in the global economy and the largely untapped potential of economies of ASEAN. The focus on Asia increased with the rise of protectionist sentiment globallyand the uncertainty around the impending UK Brexit and the Trump administration’s policies.
Wee Ee Cheong, Deputy Chairman and CEO of UOB, noted that against this backdrop, regional and multilateral programmes, such as the Belt and Road Initiative, Regional Comprehensive Economic Partnership and Comprehensive and Progressive Agreement for Trans-Pacific Partnership, are helping to foster closer economic cooperation within Asia.
“ASEAN specifically, with its ASEAN Economic Community, has been working on improving regional connectivity and collaboration on various aspects, including economic and financial development, based on the principles of non-interference and consensus. There is wisdom in ASEAN’s pragmatic and paced approach to integration.”
The grouping’s efforts, combined with ASEAN’s favourable fundamentals such as its young population, growing consumer affluence and strong prospects for trade and investment, will continue to drive rapid economic development in the region, says Wee.
Asian banks, which have had their balance sheet built upafter the Asian Financial Crisis in the late 1990s, are also in a stronger position to meet tightened regulatory frameworks and higher capital requirements. This in turn enables them to capitalise on the economic initiatives and positive trends in the region to maintain their growth momentum.
“These favourable conditions present opportunities for Asian banks to help more consumers and businesses benefit from the enormous potential of the region. UOB, having operated in the region for more than 80 years, has been developing and maintaining deep customer relationships by helping our customers build and safeguard their wealth and businesses.
Through our established network and years of operating in this region, we have gained a deep understanding and appreciation of our customers and the business environments in which they operate. This enables us to provide them with distinctive experiences that are catered to their needs” says Wee.
“For example, we recognise that millennials are a force of growth in Asia with their consumption power and entrepreneurial mindset. To help them achieve their financial goals and aspirations, we have designed a range of products and services aligned with their lifestyle needs, from the UOB YOLO card to the UOB Young Professionals investment solution.”
Given the ubiquity of mobile phones and the increasing digital-savviness of customers, in 2015, UOB introduced its all-in-one mobile banking app, UOB Mighty, which enables customers to bank, to dine and to pay on the go.
“Recently, we also introduced a customised mobile keyboard, UOB MyKey, which our customers can use to pay or to be paid directly with whom they are chatting on social messaging apps.”
Invest in people to succeed as an organisation
Despite the continuous growth of Singaporean banks in the region, Wee recognises that competition for talent remains a challenge.
“As we seek to hire people with aptitude for specific roles, we also focus on ensuring that they possess and demonstrate the right attitude and values. We want our people to be guided by these values as they draw on their expertise and experience to advise and to act in the best interests of our customers.”
UOB has a regional workforce where 96 per cent employees are hired locally. “This means that we are able to nurture a deep understanding of local markets and not be seen as ‘suitcase bankers’,” says Wee.
To help build meaningful careers for its employees, UOB is also committed to continuous employee training and development. Beyond professional capabilities, the bank also ensures that its employees are equipped with the competencies, skills and knowledge they require to be ‘future-ready’.
Photo: Ms Indranee Rajah, Senior Minister of State for Law and Finance, and Mrs Josephine Teo, Minister in the Prime Minister’s Office and Second Minister for Home Affairs and Manpower, and our senior leaders attending the launch of UOB’s PCP in November 2017.
For example in November 2017, UOB rolled out the first phase of its Professional Conversion Programme (PCP) for 900 of its branch employees in Singapore. The training programme enables these employees to deepen their digital skills in areas such as design thinking, customer journey design, channel management, and scenario analysis and planning. All the PCP modules are accredited under the IBF Standards Training Scheme, Financial Training Scheme or by Workforce Singapore, which are recognised nationally.
“For our colleagues, we nurture them by developing their skillsets and mindsets to prepare them for the future. We are focused on strengthening their capabilities so that they can excel in their respective fields and are equipped to build and to maintain the trust that we have earned from our customers.”
Invest in technology to drive growth – yours and your customers’
Local banks must also recognise that major global banks are not their only competitors – nimble Fintech startups are employing new digital technologies to disrupt the market.
In the face of disruption, banks often collaborate with non-traditional financial players to offer digital solutions, such as those that enable enterprises to overcome challenges and to grow.
“Our experience in the region has given us first-hand understanding of what it takes to build sustainable businesses. And we employ technology with this aim in mind: helping companies manage and grow their businesses by increasing their productivity,” says Wee.
The UOB Virtual Payment Solutions suite is an example of how UOB’s corporate clients can benefit from digital solutions. Using this suite, companies can pay their vendors and suppliers through a virtual corporate credit card account, even if they do not accept card payment. This process also means that companies’ account reconciliation is automated, which in turn reduces the risk of human error and increases the companies’ efficiency.
“For UOB, we direct our technology investments to areas such as mobility, payments, connectivity, data and security,” he says. “As we do so, we ensure that the speed, convenience and security of every digital experience is wrapped with the human touch.”
Wee is optimistic about the future, noting ASEAN’s favourable fundamentals and prospects to become the fourth largest economy by 2030, behind the US, China and India.
“Banking is more than just numbers. At UOB, we believe banking is also an art form. As with a good piece of art, the customer relationships we form appreciate over time. Therefore it is essential that we are prepared not just to help our customers in the present but also for what tomorrow brings,” he says.
To learn more about how you can learn the skills needed for the future of finance, visit IBF.