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Amid rising trade tensions, UOB to double down on Asean-China flows: CEO
UOB on Wednesday said it plans to capture greater connectivity flows between Asean and Greater China, with the bulk of its operating profit from outside Singapore already derived from operations in the Asean region and Greater China.
This comes as cross-border market revenue in Asia is expected to hit around S$40 bilion in 2020, the bank said. New business flows into South-east Asia are "very likely" given the escalation in global trade tensions. With that, more businesses are expected to diversify their supply chains into Asean, with local suppliers to benefit from that shift of orders into the region, said UOB.
Speaking at the bank's annual corporate day event on Wednesday, UOB's chief executive officer Wee Ee Cheong said that currently more than 40 per cent of UOB’s group operating profit is derived outside of Singapore.
"Of which, close to 80 per cent comes from our operations in Asean and Greater China," said Mr Wee.
"We expect these numbers to go up as we strengthen our regional connectivity, collaborate in win-win partnerships to tap intra-regional flows and the region’s rising affluence for growth."
He said that in 2018, the bank worked with more than 500 companies to "realise their expansion ambitions across the region through UOB’s extensive network".
In his keynote address, Mr Wee flagged risks on the back of rising global trade tensions and concerns over a synchronised global slowdown.
“In such an environment, it is even more important that we focus on the fundamentals and not lose sight of our main objective which is to continue to achieve long-term growth that is balanced with stability," he said.
“Throughout Asean, we are strengthening our capabilities across our network, broadening our impact by building ecosystems and helping our customers seize opportunities across the region. As we sharpen our customer-centric focus, we see a greater multiplier or network effect across our franchise.”
The bank will focus on key priorities of regional connectivity, ecosystem partnerships, and strong balance sheet and quality earnings, he said. It continues to see strength in Asean, the fifth-largest economy in the world, with the region due to have its gross domestic product more than double by 2030.