Samuel Tsien, group chief executive officer, OCBC Bank
Wee Ee Cheong, deputy chairman and chief executive officer, UOB Group
Piyush Gupta, chief executive officer, DBS
Lito Camacho, vice-chairman Asia Pacific and Singapore Country CEO, Credit Suisse
Moderator: Francis Kan
The Business Times: What do you see as the new skills that bankers will require in the coming years?
Samuel Tsien: Regulatory requirements have increased dramatically. Factors such as the exponential increase in worldwide Internet usage, the rising digitalisation of financial services, the internationalization of the RMB, urbanisation and changing demographics in Asia, Asia's growing infrastructure needs and the emergence of the Asean Economic Community (AEC) have added new dimensions to our operating environment.
Bankers, therefore, must be skilled in managing complexity. This in turn requires an intimate knowledge of many fast-changing facets of today's world - not only those that directly impact modern financial markets, but also the policies and events that may indirectly create volatilities for the financial markets.
Bankers need to understand the inter-connectivity between financial markets and economies, the speed and ease with which capital and investment funds flow and information gets distributed, and the rise of social media and alternative payment providers, along with the systemic risks that come along with them.
Wee Ee Cheong: Some of the key trends in financial innovation include disruptions in payments and remittances, peer-to-peer lending, digital banking, crowdfunding and blockchain technology. This has brought new players and non-traditional competition into the financial sector, including telecommunications and technology companies.
As a result of these trends, we expect to see increasing demand for newer skills in the areas of digital banking and cyber security, advanced data analytics for predictive and diagnostic solutions, as well as developing social media guidelines in the areas of legal, compliance, risk and audit.
Piyush Gupta: Over the years, the business of banking has become more complex, and will become even more so over time. In light of this, bankers cannot just be subject matter experts. They also have to be proficient in myriad trends impacting the industry, from the more stringent compliance regime to the growing competition from fintechs.
This broader mindset will enable them to better join the dots in a fast-moving world and be more adept at navigating the changing operating environment. Given the rapid technological advancements shaping banking, they also need to embrace digital.
Lito Camacho: Firstly, the regulatory environment of the financial services industry has been rapidly evolving. Legal and compliance as well as risk management expertise is increasingly crucial for any financial institution in this increasingly demanding regulatory environment. Secondly, we have seen the rise of "disruptive technologies" and their implications for the banking industry.
Hence, a certain familiarity and agility with evolving IT systems and digital platforms is required from the relationship managers (RM) in our private banking business who need to interface with many specific tools to provide a high-level service to clients. It goes from on-boarding clients, executing trade instructions, preparing an investment proposal, rebalancing a portfolio, performing compliance tasks, and many more activities.
BT: What is your bank doing to ensure that you have the right skills to meet the new challenges?
Mr Tsien: Under the OCBC Global Connection programme, the senior leaders in OCBC's overseas markets share their professional experiences with our Singapore employees to inspire them to look into working overseas as part of their career development plans.
The OCBC Global Job Postings allow employees to consider careers beyond where they are. Such opportunities are available to our employees because our Group activities span 18 countries and regions, and across the entire gamut of commercial banking, insurance, investment banking, private banking, securities brokerage and asset management.
To realise the full potential of these key employees, we have also rolled out the OCBC Future Leaders Programme for young executives, the OCBC-INSEAD Executive Development Programme for mid-level managers and the OCBC Smart Asia Leadership Programme for senior managers. Each of these programmes enables participants to develop their skills in managing complexity while gaining a better understanding of other functions within OCBC and the region.
Mr Wee: Besides skills, a key differentiator will be the "software" in terms of our people and culture. Bankers will also need to be more than just technically adept but also far-sighted and open-minded, enterprising and pragmatic. These fundamental principles have driven the industry's success in the past and will continue to help us meet new challenges.
Regulation is necessary to ensure the system stays robust but at the same time, to succeed in this uncertain digital world, there must be room for experimentation and sensible risk-taking. We need to strike the right balance between governance and accountability in order for the industry to stay relevant and progress.
For UOB, the customer experience is key. Acquiring knowledge and skills is essential but it is more important to have the right attitude and discerning mind to do what is right for the customer. Every customer encounter is one that proves how reliable we are, for without trust, this industry would not be where it is today.
Mr Gupta: To enable our people to build skill-sets both in general management as well as specialist areas, we have invested heavily in training and development. For example, the DBS Academy provides a full curriculum. In 2014, DBS employees underwent an average of 45.6 hours of training.
To enable our people to gain a broad swath of experience and to take on increasingly larger roles, we also advocate internal mobility, job rotations, cross-functional projects and other experiential learning opportunities across the bank. Our internal mobility programme is structured such that employees holding corporate ranks up to assistant vice-president, who have worked two years in their current role, can seek to be placed in a new role with two months' notice. For more senior employees, the corresponding periods are three years and three months. In 2014, about a quarter of our positions were filled by internal transfers.
Mr Camacho: Our talent development area offers employees in Singapore continuous training and development opportunities through various learning programmes, such as those offered at the Credit Suisse Wealth Institute in Singapore, which are designed to strengthen the competencies of our employees and prepare talented individuals for key roles within the organisation.
Around the world, we work very closely with the local university campuses and offer summer intern, full-time and industrial attachment programmes across different divisions and functions. Interns have the opportunity to get to know our business from the inside, gain an in-depth understanding of our industry and build lasting relationships with their associates. If the interns show real potential and demonstrate exceptional performance during their time with us, they could be offered a full-time position upon graduation.
BT: What new financial technology (fintech) trends do you feel may have a significant impact on the banking sector?
Mr Tsien: In the banking sector, technology and the widespread use of the Internet and smartphones as a result of data digitalisation have enabled a re-invention of old forms of financing, delivered through new channels. Like the tontines of the old days, crowdfunding involves the collective pooling of resources across communities - with the difference being that these communities are now connected globally.
Peer-to-peer or social lending rides on today's digital social networks and is operated by online intermediaries. Cutting-edge fintech trends such as the growth in automated investment advisory, the expansion of marketplaces into new verticals and services, advances in wearables and blockchains are just some of the developments which I believe many financial institutions are watching closely. We are also watching this space closely. We will be proactive in responding to these fintech trends - or new ones barely on our radar yet - if we decide that they will significantly impact banking.
Mr Gupta: I believe that lending and underwriting models that use large-scale data analysis to make more accurate credit decisions will have a significant impact on the banking sector. I find that this new approach enables lenders to grow their customer base and capture business from competitors, while better servicing their existing borrowers, and has the potential to be a big threat to traditional banking at a fundamental level.
Mr Camacho: Relevant for our private banking business, there has certainly been much focus on the rise of what is referred to as "robo-advisors" or other technology players moving into the online wealth management space.
The "human touch" is critical in private banking - and our digital private banking platform is not a "digital only" channel that replaces the human touch but a "multi-channel" experience between the client and the Credit Suisse team that increases connectivity and collaboration. A key feature of the Credit Suisse digital private banking platform is the suite of Collaboration Tools, which create many more client-activated touch points and flexibility in the way clients and the Credit Suisse team interact.
BT: Do you think that new fintech start-ups in areas such as peer-to-peer lending will pose a threat to your business as they mature?
Mr Tsien: I still believe that banks have an intangible advantage over such companies. I refer to the public trust that customers place in us. One reason for this, ironically, is the very fact that the banking system is strictly regulated. Banks like OCBC Bank have histories and track records that reach back many years. We are also able to provide a much wider range of financial services - from payments to lending, from deposits to investment products - than the monolines of business that most of these fintech start-ups offer.
Mr Wee: In order to stay at the forefront of customer engagement in the digital world, we look at innovation not just from within the bank but also in collaboration with fintech and other eco-system players to create solutions that will meet changing needs of our customers. We recently announced the establishment of a venture debt fund to co-invest in fintech start-ups with Temasek. This initiative, along other initiatives in the pipeline, will be crucial in fostering innovation and improving the customer experience for individuals and businesses.
We also continue developing our talent to ensure that they have the necessary and relevant skillsets to keep up with the change in the technology landscape. At the same time, we are investing in new capabilities, technologies and systems to enhance connectivity within our regional network and various customer touch points.
Mr Gupta: They certainly provide an alternative source of financing, and to that extent, we are watching them carefully. However, it's not just peer-to-peer lending that could change the landscape. Fintechs are also changing the way people pay and invest. In response, we are looking at how we can integrate ourselves more seamlessly into people's lives, and to better serve and engage customers. We're also plugged into the start-up ecosystem, and are actively looking at emerging fintech innovations with a view to learning from them and perhaps integrating them along the way.
Mr Camacho: We believe a core part of Credit Suisse's value proposition to our clients is that we understand them as individuals, we have relationships built on shared experiences and trust - while digital can enhance this relationship, it will not replace it any time soon.