According to the latest Singapore Index of Inflation Expectations released on Monday, July 20 by the SMU Sim Kee Boon Institute for Financial Economics, Singaporeans expected headline inflation to rise to 3.35 per cent in a year's time due to domestic price pressures and a tighter labour market. The poll noted that for those who own their accommodation and use public transport, the one-year-ahead Singapore core inflation rate was moderated down to 3.38 per cent in the recent survey, compared to 3.52 per cent in March 2015. Respondents felt that the five-year-ahead Singapore core inflation rate would be higher at 4.17 per cent, up from 3.94 per cent in the March survey.
In a commentary, SMU Sim Kee Boon Institute for Financial Economics (SKBI) Director and Professor of Quantitative Finance (Practice) David Lee commented on how Singapore banks have to harness digital technology and practise financial inclusion to grow their business. At a keynote speech at SMU SKBI’s 5th annual conference, CEO and director of the DBS Group Piyush Gupta said: “unless traditional banks adapt, innovate and harness digital technology, they would perish sooner than they could realise any threat”. Prof Lee cited examples of non-bank entities like the Alibaba Group and stated that Singapore banks should study their developments and its implications.
The Asian Financial Leaders Programme (AFLP), jointly developed by SMU and the Temasek Management Services Academy, was featured in a report on new initiatives introduced by the government to strengthen Singapore’s financial sector. The AFLP is a programme for finance professionals aspiring to C-suite roles. Deputy Prime Minister and Finance Minister Tharman Shanmugaratnam said that the efforts to develop professional talent and skills in the financial industry are also aimed at developing a strong core of Singaporean leaders in the sector, and this will help define Singapore's continued success as a financial centre.
The Monetary Authority of Singapore has mandated SMU and the TMS Academy to develop the Asian Financial Leaders Programme, which aims to prepare senior-level talent in Asia's financial sector to assume leadership positions, and handle the complexities of both regional and global economic landscapes. It includes industry visits to China, Indonesia, Switzerland and the US, where participants will have the opportunity to interact with global thought leaders, practitioners and regulators. The programme will be launched in November this year, and is open to those in the banking, insurance, investments and private equity sector. Upon completion of the programme, participants will be awarded three certificates from TMS-SMU, IMD business school and The Wharton School of the University of Pennsylvania.
SMU will work with the Temasek Management Services (TMS) Academy to develop the Asian Financial Leaders Programme under the mandate of the Monetary Authority of Singapore. The programme aims to prepare senior-level Asian financial leaders to assume leadership positions and handle the growing complexity of Asia's financial institutions, including those in banking, insurance, investments and private equity. The programme will be launched in November this year, and participants will receive three certificates from TMS-SMU, IMD business school and Wharton upon completion. SMU President Professor Arnoud De Meyer said: “Given our growing trade and financial networks within ASEAN, and with China and India, Singapore is in a unique position to develop deep pools of knowledge of these regions.”
Blockchain. P2P. Consensus ledgers. Internet finance. FinTech.
These were banking and financial technology jargon oft heard during the keynote speeches, panel discussions and lunch time interactions between participants at the 5th Annual SKBI Conference co-organised by the Sim Kee Boon Institute for Financial Economics (SKBI) and China Europe International Business School (CEIBS), and held at Singapore Management University on 6-7 May 2015.
More than 600 academics, researchers, banking and financial professionals, fintech startups and regulators attended the two-day conference, which was themed “Digital Banking, Financial Inclusion and Impact Investing”.
In his Welcome Address on the first day of the conference, SMU Provost Professor Rajendra K. Srivastava said that investors and financial institutions seeking for profit opportunities and higher returns on equity – in a low growth environment, flushed with liquidity – will do well to take advantage of the digital revolution. He added, “The availability of technologies like cryptocurrencies has opened the door to more financial innovation. Technology can potentially lower overheads which stymie traditional financial instruments. Lower costs and charges have enabled access to the underbanked and unbanked, thus bringing about financial inclusion without compromising on profitability.”
[Caption: Keynote speaker Mr Piyush Gupta, CEO of DBS Group, warned that disruptive new business models in the financial industry could soon push slow-moving banks out of business.]
Mr Piyush Gupta, CEO of DBS Group, observed that traditional banks have to take note of three major trends: integrate banking services into the daily lives of people, seize opportunities presented by the rise of the sharing economy, and utilize big data to raise service standards and efficiency. He noted that wealth management has been commoditised, with non-banks such as Nutmeg having pledged to flatten their investment fees. He also urged banks to think beyond just offering customers mobile applications and instead relook their entire processes in order to ride the digital wave.
[Caption: (from top to bottom) Dean and Vice President of CEIBS Prof Hellmut Schütte, CEIBS Professor of Finance and Accounting Rui Meng, author Mr Chris Skinner, and Mr Matthias Kroner of Fidor Bank AG were among the thought leaders and experts who spoke at the SKBI Annual Conference.]
Other speakers on Day One included CEIBS Dean and Vice President Prof Hellmut Schütte who shared his insights on the Chinese economy and the competition among Chinese companies; CEIBS Professor of Finance and Accounting Rui Meng who spoke about China’s P2P lending boom; author Chris Skinner who disclosed the strategies of becoming a digital bank; and Mr Matthias Kroner who shared Fidor Bank’s experience in setting up a bank in today’s digital environment.
The programme for Day 1 ended with a dinner at Fairmont Hotel where Guest-of-Honour Dr Vivian Balakrishnan, Minister for the Environment and Water Resources and Minister-in-charge of Smart Nation, urged companies in the banking and financial industry to find new ways to deliver new services. He stressed the importance of all organisations, be it a bank, financial institution, consultancy firm or university, to focus on data science and data analytics. He also noted the need for more rational, careful, and technologically-based conversations on the issues of cybersecurity, protection of privacy, and especially protection of identity. “Because you cannot have a world that is fully able to take advantage of financial innovations, information revolution, even electronic medical records, if a decent level of security, protection from identity theft, and protection from a loss of privacy and confidentiality is not guaranteed. In other words, security is the essential flip side of the coin of utility; and if we can get that done right here, then we have a head start.”
[Caption: Members of the audience listened in rapt attention and participated actively during the Q&A sessions at the two-day conference.]
In his Opening Address on Day Two of the conference, SMU President Professor Arnoud De Meyer observed that the digital economy in China has grown tremendously over the years. Companies like Alibaba started from non-finance related industries such as e-commerce, to encompass many aspects of digital finance including mobile payments, peer-to-peer lending, crowdfunding, investments and fund management. Alibaba grew their small and medium enterprise loans to USD 16 billion in three years. It also raised USD 87 billion to be the largest fund manager in China, capturing 20 per cent of all new renminbi deposits only nine months after its launch.
[Caption: (top to bottom) The keynote speakers for Day Two of the conference were Mr Tian Tao of Huawei International Advisory Council, and Mr Loh Long Hsiang, Head of CEO Office at Standard Bank China. In his keynote address, SKBI’s Executive/Academic Director Professor David Lee shared his insights on digital banking and financial inclusion in ASEAN.]
Professor David Lee, Executive/Academic Director of SKBI spoke on Digital Banking and Financial Inclusion in ASEAN. He said that at least 70 percent of the population in ASEAN does not fully enjoy banking and financial services today, of which 40% are unbanked. This presents a huge and attractive market for micro-finance and digital banking. Prof Lee posited a new business architecture based on LASIC principles -- Low Margin and Low Barrier, Asset Light, Scalable, Innovative, and Compliance Easy. Companies with LASIC characteristics will grow very well. According to Prof Lee, LASIC alone is not enough to have growth on a macro scale, it must go hand in hand with financial inclusion and impact investing.
[Caption: SMU’s Associate Professor Pei Sai Fan (extreme right) moderated a panel discussion on the development and management of internet finance platforms such as crowd funding.]
Other speakers on Day Two included Mr Tian Tao of Huawei International Advisory Council who spoke about the evolution of the internet in China and the disruptive innovations which came about; Mr Loh Long Hsiang, Head of CEO Office at Standard Chartered Bank China who delivered a speech on the convergence of banking and technology.
[Featured photo: In his address at the conference dinner, Dr Vivian Balakrishnan, Minister for the Environment and Water Resources and Minister-in-charge of Smart Nation, urged companies in the banking and financial industry to find new ways to deliver new services.]
At the 5th Annual Sim Kee Boon Institute for Financial Economics Conference 2015 held by SMU on May 6, industry players said that Singapore is well-positioned to tap the massive prospects of financial technology (FinTech). DBS Bank and Standard Chartered Group, among other industry players, also said during the conference that opportunities in digital banking will continue to be driven by the increase in mobile usage, the rise of the sharing economy, and the expansion of big data.
In his welcome address at the "Digital Banking, Financial Inclusion and Impact Investing" conference organised by the SMU Sim Kee Boon Institute for Financial Economics and China Europe International Business School, SMU Provost Professor Rajendra K. Srivastava said that investors and financial institutions seeking for profit opportunities and higher returns on equity – in a low growth environment, flushed with liquidity – will do well to take advantage of the digital revolution. CEO of DBS Group Mr Piyush Gupta spoke on “Digital Banking in Asia”; while a panel discussion in the morning, which involved Professor Gerard Geroge, Dean of the SMU Lee Kong Chian School of Business, discussed the opportunities in Asia for digital banking.
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