Commentary

Goodbye deleveraging: Fiscal and monetary expansion to support growth in China

Against very clear headwinds due to the trade war and decelerating investment, China's State Council has unveiled plans to take a more aggressive fiscal policy in 2018 with a reduction of corporate and household burden by RMB 1.1 trillion. In the whole year, tax reduction will amount to RMB 800 billion for enterprises and individuals, which is equivalent to 5.5% of total tax revenue in 2017. This includes the adjustment in value added tax, the reduction in corporate tax rate of manufacturing, transportation, and other industries, and the rebate from research and development expense. Another RMB 300 billion will come from reducing non-tax burden on costs in logistics and utilities. The total amount is roughly equivalent to the reduction in corporate burden from the US tax reform of $150 billion (RMB 1 trillion).

Commentary

Goodbye deleveraging: Fiscal and monetary expansion to support growth in China

Commentary

Paths to overcoming the trap: Digital transformation as an opportunity

The topic being discussed most nowaday is “Opportunities and Challenges of Digital Transformation in Southeast Asia”. OECD-SEARP has been engaged in active discussions on policies to make digitalisation work for better lives and inclusive growth. Japan has actively lead those discussions. OECD has been working on a horizontal project to assess the potential and impact of digitalisation on various aspects of human lives. It is essential to recognise digital transformation as an opportunity, not as a problem.

Commentary

Human-machine collaboration could be a big boon for financial firms, if only they fully embrace it

Artificial intelligence has been a topic of conversation and a part of business for years, from rogue robots in movies to neural networks that detect fraud at credit card companies, but only recently have companies really started experimenting with and implementing it more widely.

Commentary

Alternative payment providers position for growth in Indonesia

When it comes to growth opportunities for digital payments, Indonesia is in a league of its own. The prospect of tens of millions of new digital payment customers is too much for digital companies and investors to ignore. The likes of SoftBank, Alibaba’s Ant Financial, and Chinese ride hailing giant Didi-Chuxing are injecting billions of dollars into companies with a chance of gaining a foothold in the market.

Commentary

Open API is just the beginning

It might seem as though vertical division of labor and horizontal disintegration have already proliferated enough.

Commentary

Amazon's big plunge into banking

Banks that focus on customers over products have the best shot at standing up to Amazon's juggernaut when it steams into their market.

Commentary

The biggest challenges Southeast Asian banks are facing today

Banking executives today not only have to deal with running the bank, but also transforming it to grow in a sustainable manner. Banks have to balance these goals against the exigencies of the day, and those that are able to do so will be amply rewarded. This holds true for all banks, even those operating in Southeast Asia (SEA).

Commentary

Open API banking: New framework, threats, and opportunities in Japan and APAC

In general, an API refers to a technical specification for operating a specific program by another program, and it defines command statements (commands and functions) used when the program is operated, a format of data to be transmitted and received, and the like. For example, many businesses today display a Google map when publishing their location on the website. This is realised by outputting map data (Google Maps) using Google's API (Google Maps API).

Commentary

Global asset managers in China: Opportunities arising from structural reform

This is now an inflection point for foreign asset managers as China vows to allow foreign players to take controlling stakes and operate domestically in the private securities fund management (PFM) and even mutual fund management markets.

Commentary

Time to face the future: The regulatory outlook for Asia-Pacific banks

As we move into 2018, Asia-Pacific banks are facing a range of challenges — from implementing Basel III reforms and keeping pace with technology advancements, to responding to the disruption and opportunities posed by new, non-traditional market entrants. Pressure is also coming from investors, who are demanding that banks improve returns on capital in an environment where economic growth continues to be modest and competition fierce.

Commentary

China's “matryoshka” approach for debt-to-equity swaps could be good for banks, but bad for investors

Chinese banks seem to have made meaningful progress in the resolution of problem loans. The aggregate amount of the announced debt-to-equity (D/E) swaps has reached 1 RMB trillion, to 19.5% of problem loans by the end of 2017. However, words are louder than actions as only 15.7% of the total announced D/E swaps have been executed. Banks clearly need to move faster in their cleanup and Chinese regulators are not only aware but also increasingly supportive. To this end, the big five banks have established their own asset management companies (AMCs) to help carry out debt-to- equity swaps. The way in which banks and their asset management companies will operate for the loan cleanup was clarified in a new guideline jointly published by regulators last January.

Commentary

Banking in the digital era: Challenges and opportunities

Banking is considered by most as the business of money. However, talk to a banking veteran and he or she will categorically instruct you that banking is a business of customers. This realisation is what ensured that customer centricity is an important value adopted by banks; and it has stood us in good stead. It then follows, that if we are in the business of customer, then our business is shaped by evolving changes in customer behaviour.

Commentary

Unlocking growth in ASEAN's digital economy: The time is now

In just decades, digital advancement has enabled technology to shift from being a business enabler to being THE business.

Commentary

Digital transformation: Digital framework in banking

In the banking sector, we take a broad view of digital—one that transcends new apps and the deployment of new and different channels. Moreover, we believe that digital is making it imperative for financial institutions to review and transform their organisational structures to ensure success and survival.

Commentary

Digital transformation: Strive for frictionless in processes and organisations

Banks need to narrow the distance with customers, to offer them an array of contact points, and to better understand their behavior and needs. New banking models start with establishing frictionless relationships with customers.

Commentary

Chinese banks' improved asset quality cannot hide other phantoms

Robust economic growth and, especially, higher industrial prices have pushed up Chinese corporates’ profits since 2016. This comes as an upturn after a horrible 2015. Indirectly, this has also helped banks as it has increased companies’ cash flows to repay their large debt burden. However, this improvement in asset quality cannot mask other growing concerns in China’s banking sector.

Commentary

5 key lessons for Asian banks' BCBS 239 compliance journey

Since the BCBS 239 principles on risk data aggregation and risk reporting were published by the Basel Committee in 2013, globally systemically important banks (GSIBs) have invested significant time and budget to reach compliance. However, four years on, the great majority are still not yet fully compliant, as updated by BCBS in March 2017.

Commentary

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