Financial institutions across Asia have stepped up overseas expansion and collaboration efforts since the 2008 global financial crisis, marking a shift from the US and European markets, CTBC Financial president Daniel Wu (吳一揆) said yesterday.
The financial sector is poised to see accelerated efforts in regional integration throughout Asia in the next decade, Wu said at a press conference of the 32nd general meeting and conference of the Asian Bankers Association (ABA) in Taipei.
“In particular, we have identified expansion opportunities through the acquisition of stakes in banks in Indonesia and the Philippines, as regulators there have begun limiting the amount of shares that can be held by the family of bank founders,” Wu said.
Vietcombank board of directors chairman Nghiem Xuan Thanh said that Vietnam welcomes Taiwanese financial institutions that want to enter the nation and would provide aid in seeking regional participation in economic integration efforts.
Speaking at the conference, Wu said that financial technology, also known as fintech, offers a more efficient and accurate method for banks to perform online identity verification and reduce risks associated with forgery when compared with conventional paper documents and signatures.
There are challenges brought on by the digitization of banking and financial services, Bankers Association of the Republic of China (銀行公會) chairwoman Catherine Lee (李紀珠) said at the conference.
“The proliferation of fintech has brought on significant savings in operating expenses, enabling companies to reach out to a broader demographic, such as individuals and small to medium-sized enterprises,” Lee said.
By leveraging fintech, coverage of overseas markets might be achieved with fewer branches, which are costly to set up and require lengthy regulatory approval, she said.
“However, at the same time we are seeing greater competition from more nimble fintech rivals, who are faster in creating new Internet-based services that are closely tailored to the needs of customers,” Lee said. “The emerging trend is a double-edged sword.”
Echoing Lee's remarks, ABA Advisory Council chairman Choi Dong-soo said that the rise of fintech has started affecting South Korean banks, with many imposing early retirement for employees in light of dwindling revenue contribution from bank branches.”
On Thursday, fintech expert and author Bret King said in a keynote speech that the banking system is flawed, and that the introduction of machine intelligence and digital experiences might threaten the very nature of the financial services sector.
King said old guard financial institutions are at risk of losing the next generation of “digital natives” as they come of age, as physical branches have lost its relevance to the demography.
“The best advice we get in the future is in real-time, not in a bank and not from a financial adviser,” said King, who is also the founder and chief executive officer of Moven, a mobile device-based banking system.
Humans simply cannot match advanced algorithms that sifts through the immense amounts of data and content generated daily, he added.
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