China’s shaky economic recovery will likely spur fast-growing Chinese firms to expand into South-east Asia and allow lenders to benefit from the increased trade flows, said an OCBC Bank executive.
Singapore’s second-largest bank aims to increase contributions from its Greater China and Asean markets towards its transaction banking business, which serves firms in areas ranging from cash management to trade finance.
Mr Melvyn Low, OCBC’s head of global transaction banking, said the bank will intensify its efforts in instant cross-border payments and is also exploring the use of digital currencies for payments and trade.
“My goal is that the entire business outside of Singapore has to be as large or even larger than my Singapore business,” he told The Straits Times in a recent interview.
Singapore currently accounts for more than half of transaction banking earnings at OCBC, which also counts Malaysia, Indonesia and Greater China – mainland China, Hong Kong, Macau and Taiwan – as its key markets.
Hong Kong and mainland China are the fastest-growing parts of the business, with the markets’ contributions to its total income growing at a compound annual growth rate of 20 per cent in the last five years.
The lender said in July 2023 that it will invest more than $50 million over three years to build up its transaction banking capabilities in Greater China, with the aim of achieving more than 500 regional mandates for cash management over five years.
A regional mandate allows the bank to process and convey a business client’s financial and transactional data from the company’s various subsidiaries to its head office, via a regional centre in Singapore or Hong Kong. It also acts on the head office’s instructions for other markets, in areas such as account opening and payments.
Bu hikaye The Straits Times dergisinin February 10, 2024 sayısından alınmıştır.
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Bu hikaye The Straits Times dergisinin February 10, 2024 sayısından alınmıştır.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
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