Regional Differences as South-east Asian Banks Review Post-crisis Strategies

A recent survey of banks in south-east Asia, conducted by SunGard and IDC Financial Insights, highlighted the emergence of institution-specific business strategies as banks address their post-crisis opportunities and threats. The survey results, which were compiled from the responses of 168 banking executives from Indonesia, Malaysia, Thailand and Vietnam, showed significant differences of focus, particularly at a country level. The survey results also outlined some of the key challenges for banks in the region.

Highlights of the survey include:

• About 38% of respondents anticipate more focus on their organisation’s core businesses, 22% of the respondents expect to focus on areas beyond their core strengths, and 40% will attempt to strike a balance between ‘core-focused growth’ and ‘new growth’.
• Banks can also be differentiated by their outlook in 2010 – ‘threat-aware bank’ and ‘opportunity-cognizant bank’.
• About 62% of banks would fall under the category of ‘opportunity-cognizant bank’. It is expected that these banks will stake out new markets, gain first-mover advantage in new business areas, or innovate in the search for new business models.
• About 23% of the respondents would fall under the ‘threat-aware bank’ category. To counter the many threats confronting them, these banks are looking at initiatives to improve business processes, focus on risk management to help ensure that they adequately mitigate and manage the vulnerabilities of their institutions, and concentrate on cost management.
• Finally, all banks must focus on their fundamental assets – staff, capital and customers. They must be able to manage their business imperatives and drive efficiencies around these three main assets.

Nicholas Brewer, vice president, global banking for SunGard’s banks business, said: “The financial crisis has led many banks to realise that they need a prudent, long-term balanced view of their business. Regardless of size, type, priority or credo, banks recognise that sustainable growth and profitability is provided by their customers; that their business operations rely on the expertise of their staff, however much this is leveraged with technology; and that their capital represents their ability to survive into the future.”

In other news, SunGard launched its Ambit Capital Management and Ambit Liquidity Risk Management solutions in China. China Everbright Bank (CEB), Shenzhen Development Bank (SDB) and Shanghai Rural Commercial Bank (SRCB) are using SunGard’s Ambit to help meet increasingly complex international regulatory compliance requirements, and minimise the cost of, and exposure to, risk.

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