Vincent Lingga, The Jakarta Post, Singapore
DBSg, Southeast Asia’s largest bank by assets (totaling about US$215 billion as of last June), inauurated with great fanfare the Asia Hub of its key operations in a 3.1-hectare building near Changi Airport in Singapore on Monday.
Capitalizing on its deep understanding of the region and appreciation of local cultures, DBS has set its eyes on becoming a leading Asian bank with a strong presence in three key growth areas — South East Asia, South Asia and Greater China (Hong Kong, mainland China and Taiwan).DBS chief executive officer Piyush Gupta pointed out confidently that DBS was well positioned to play a leading role in Asia because it was already strongly entrenched in Singapore (its headquarters) and Hong Kong, the largest hubs of the Asian financial service industry.
The mood at the inauguration was overtly bullish for a bank that has just emerged from three bouts of turbulence.DBS had spent the two years prior to last November in relative leadership limbo and suffered a major fallout as thousands of its clients in Singapore and Hong Kong were burnt in the doomed Lehman Brothers structured products in late 2008.In a bid to maintain its customer loyalty and trust, DBS decided in July to reimburse $84 million to more than 2,150 of its customers in Hong Kong who through DBS bought structured notes from the now defunct Lehman Brothers.
Now with all those problems resolved, DBS seemed poised to expand at a faster pace to broaden its footprint across Asia.“We are strongly committed to growing in and with Asia,” said Gupta, who took over the DBS leadership last November after the sudden death of Richard Stanley who had been at the helm only around one year.Gupta, who has spent two-thirds of his 28-year career in Southeast Asia and Hong Kong with responsibilities encompassing all of Citi’s businesses including financial markets, corporate and investment banking, transaction services, credit cards, retail and wealth management, seems well fit to lead DBS in its expansionary mood in Asia.
Indian-born Gupta’s experience will certainly be a strong asset to help DBS expand in India, where the Singaporean bank already has more than 10 branches and is seeking permission to open eight more. While as of last year Singapore contributed 57 percent to DBS’ total income and Hong Kong 22 percent, the bank aims to achieve a 40:30:30 revenue balance between Singapore, Greater China, South and Southeast Asia, within the next decade.“If we are serious about playing a leading role in Asia we should have a strong presence in China, India and Indonesia,” he said.
The bank already has more than 240 branches across six key markets — Singapore Hong Kong, China, India, Indonesia and Taiwan — and dozens in nine other foreign markets.In Indonesia, where DBS operates through a 99 percent owned subsidiary, PT Bank DBS Indonesia, the 42-year-old bank has dramatically expanded its operational network from three branches in 2004 to more than 40 now in a dozen cities.“We have an aggressive strategy in Indonesia, Southeast Asia’s largest economy, to expand steadily through an organic growth,” he said.DBS Indonesia has set itself an ambitious target to upgrade it self from its current position among the 20 largest banks in Indonesia to being in the top 10 in the next few years.
In another move to strengthen and expand its footprint in the region, DBS early this month shook up its management in Hong Kong by appointing Sebastian Paredes as the new CEO if its Hong Kong unit.Paredes, who has been working in banking for more than 25 years, including 20 years at Citibank, retired early this year as the CEO of Bank Danamon, Indonesia’s fifth-largest bank.
Another DBS senior executive, Andrew Ng, said the bank would invest $192 million within the next five years, to expand its treasury and money market operations, notably in Greater China, India and Indonesia, designed to be the main engine of its financial service growth in the future.
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