| Market Development
BI Prepares Four Steps to Develop Sharia Economy Tempo 29th Oct 2015
Bank Indonesia (BI) is preparing four steps to expedite the development of sharia economy, hoping the public will find its products increasingly attractive. In this way, it will contribute towards better performance of the national economy. "We must take collective steps which support the sharia economy and finance to develop into a global pillar," Bank Indonesia Deputy Governor Perry Warjiyo told a seminar on "Sharia financial education for entrepreneurs" on Wednesday. The seminar is part of a series of activities under the Indonesia Sharia Economic Festival (ISEF) 2015 being held in the East Java provincial capital of Surabaya from October 27 to November 1, 2015.
Indonesia lagging behind Malaysia in Islamic banking The Straits Times 28th Oct 2015
Indonesia's ambitions to rival Malaysia as an Asian Islamic finance hub are shrinking along with its syariah-compliant banking assets. While Indonesia is host to the world's biggest Muslim population, Malaysia's government has been more aggressive in supporting the industry and announced further tax breaks for sukuk or Islamic bonds in last Friday's Budget. The Jakarta-based Financial Services Authority said the nation's Islamic banking assets fell 27 per cent to 200 trillion rupiah (S$20.5 billion) in the first eight months of this year from a year earlier, while those of its neighbour rose 13.7 per cent to a record RM672.6 billion (S$219.8 billion).
Analysis: Opportunities for Indonesia sharia banking Jakarta Post 28th Oct 2015
The banking system has an important role in the economy. Nowadays, most people are somehow connected with a financial institution. Banking activities have continued to evolve in line with the development of society. Banks have, in fact, come to greatly affect the development of the public economy, at the national and even global level. In this regard, as the country with the largest Muslim population in the world — around 205 million people or 88.1 percent of its 2010 total population — Indonesia has naturally seen a rapid development of thought concerning sharia banking that is in accordance with the principles of Islam. There is momentum for the development of an Islamic-based economy in Indonesia, beginning with Bank Muamalat Indonesia founded in 1992, and then Bank Syariah Mandiri (BSM) in 1999. For more than 20 years, the Muslim community, ranging from academia, government, banking and non-bank financial, political and socio-economic institutions, has worked hard to see the establishment of a sharia economy in Indonesia.
Two named to SET board of governors Bangkok Post 28th Oct 2015
The Securities and Exchange Commission board yesterday appointed former Bank of Thailand governor Chaiyawat Wibulswasdi and current chairwoman of the Federation of Thai Capital Market Organisations Voravan Tarapoom to the Stock Exchange of Thailand board of governors. The new governors will take office for a two-year term from today. At a later date, the SET board of governors will vote to select one of its 11 members to become the new SET chairman. Speculation has it that Mr Chaiyawat will be named SET chairman, succeeding Sathit Limpongpan, whose term ended in September.
Malaysia central bank starts taking US dollar deposits for the 1st time as ringgit sinks The Straits Times 30th Oct 2015
Malaysia's central bank started taking in interbank US dollar deposits for the first time in September to try and slow a slide in Asia's worst-performing currency. Bank Negara Malaysia is accepting deposits in small amounts, according to a person familiar, who asked not to be identified because of company policy. The move will help build up the country's currency reserves, two other people said. The monetary authority said in response to questions that it's encouraging financial institutions, including branches of overseas banks, to keep foreign-currency earnings and deposits of Malaysian-based companies in the domestic market. Falling reserves in the Southeast Asian nation have fueled speculation the central bank has been intervening by selling dollars to help prop up the ringgit. The holdings dropped below the US$100 billion mark in July for the first time since 2010, a blow to investor confidence. They have since recovered slightly but are still down 19 per cent this year at US$94.10 billion.
Asset Management
Thailand extends tax incentives for long-term equity investment: Finance Minister The Straits Times 3rd Nov 2015
Thailand's Cabinet approved on Tuesday (Nov 3) an extension of tax incentives for long-term-equity funds (LTFs) for three more years from 2016 to help revive flagging stock market sentiment and boost domestic savings, the finance minister said. "The Cabinet agreed with the tax extension today to make it clear to investors of the Thai stock market. We consider LTF as a saving tool," Finance Minister Apisak Tantivorawong told reporters. Under the scheme, taxpayers can deduct contributions of up to 15 per cent of their personal income or up to 500,000 baht (S$19,706) for invesment in LTFs. The Cabinet adjusted the holding period of LTFs to seven calendar years from five, he said.
Bursa Securities queries Idimension over surge in volume The Star Online 2nd Nov 2015
Bursa Malaysia Securities Bhd has queried Idimension Consolidated Bhd over the sudden rise in volume of the shares on Monday. At 11.27am, it was the most active counter with 93.56 million shares done. The share price ranged from 11 sen to 12.5 sen. It was unchanged at 11.5 sen. Idmension is a software solutions provider specialising in manufacturing software applications for semiconductor and electronics components Bursa Securities had advised investors to take note of the company’s reply to the unusual market activity query when making their investment decision. It directed the company to enquire with the directors, major shareholders and other relevant persons whether there was any corporate development that might account for the trading activity including those in the stage of negotiation/discussion.
Regulatory OK sought for dollar bonds Business World 2nd Nov 2015
The government has taken a step further in its plan to offer dollar-denominated bonds by seeking regulatory approvals required for the exercise. National Treasurer Roberto V. Tan said yesterday that the government has sought the green light from the Bangko Sentral ng Pilipinas (BSP) and is talking with the US Securities and Exchange Commission (SEC) for shelf registration. “We have already submitted a request not only for any possible opportunity within the year, but also in preparation for an issuance even early next year if there’s an opening at that time,” Mr. Tan said. “[I]f nothing happened this year, then we will pursue that next year; that’s why the preparation we’re doing at this time is for us to be ready also for next year in case nothing happens this year,” he explained, adding that his office was also in talks with the US SEC.
KL central bank acts to slow ringgit's slide The Straits Times 31st Oct 2015
Malaysia's central bank started taking in interbank dollar deposits for the first time last month to try and slow a slide in Asia's worst-performing currency. Bank Negara Malaysia is accepting deposits in small amounts, in a move to help build up the country's currency reserves, according to people familiar with the matter, who asked not to be identified. The authority said that it is encouraging financial institutions to keep foreign currency earnings and deposits of Malaysian-based companies in the domestic market. Falling reserves have fuelled speculation that the central bank has been intervening by selling US dollars to help prop up the ringgit.
Ringgit likely to stay weak next week The Rakyat Post 31st Oct 2015
The ringgit is likely to trade within the range of between 4.25 and 4.35 against the US dollar next week on the back of firm greenback following the Federal Reserve recent statement that left the December interest hike open. Inter-Pacific Research Sdn Bhd research head Pong Teng Siew said the the possible interest rate hike in December helped to further strengthen the greenback against other currencies. “However, the slide in ringgit is expected to be more gradual compared with the period between July and September this year which had seen the local currency dropped more rapidly.” On the local front, Pong said investors would look forward to Malaysia’s October trade data, as well as Bank Negara Malaysia’s reserve announcement, scheduled for next week, for clues on Malaysia’s economic situation that would also affect the ringgit performance.
Weakening rupiah to overshadow next year’s growth Jakarta Post 29th Oct 2015
The weakening of the rupiah is estimated to persist into 2016, overshadowing next year’s growth target, a recent discussion by DBS Group Research has concluded. According to DBS economist Gundy Cahyadi, the rupiah will still be under pressure as a result of significant strengthening of the US dollar. “The strengthening of the US dollar is not merely driven by the Federal Reserve’s plan to jack up its key rate,” he said. “It is also caused by the stimulus packages rolled out by the central banks of Japan and the European Union. Their money printing activities have reduced the value of the yen and euro when compared to the US dollar.” The strengthening dollar eventually impacted other currencies, including the rupiah, he added.
Singapore dollar to drop 2% by year-end on MAS easing, analysts say The Straits Times 28th Oct 2015
The Singapore currency will weaken about 2 per cent versus the US dollar by the end of the year after the Monetary Authority of Singapore (MAS) "slightly" reduced the pace of its gains versus those of its trading partners this month, according to a survey of analysts by Bloomberg News. The Singdollar will slide to $1.42 per US dollar by the end of December after MAS probably lowered the slope of its appreciation against a basket of currencies to 0.5 per cent this month, from 1 per cent, according to the median estimate of 19 analysts. The projected level would still be stronger than the six-year low of $1.4366 reached on Oct 2. The local dollar slipped 0.1 per cent to $1.3980 per US dollar at 8:39 am in Singapore. Oversea-Chinese Banking Corp. forecast it will tumble to $1.4570, the most bearish projection, while Mizuho Bank Ltd. saw it stronger at $1.39.
Banking
Singapore banks face slow loans growth, weak asset quality The Straits Times 3rd Nov 2015
The issues of slowing loan demand and vulnerable asset quality were front and centre for the local banks in the third quarter as the commodity crunch and economic headwinds continued to pressure corporate and consumer borrowers. All three reported subdued single-digit loan growth in the three months to Sept 30, compared with growth in the second quarter. OCBC Bank's loans grew 1 per cent quarter on quarter, United Overseas Bank saw only a 0.4 per cent expansion, while DBS Group, which reported its results yesterday, grew loans by 2 per cent. The year-on-year growth rates were propped up by currency effects but still fell in the 3.7 to 9 per cent range.
Citibank upbeat RI banking sector to pick up next year Jakarta Post 3rd Nov 2015
The Indonesian subsidiary of US-based Citibank is confident that the Indonesian banking sector will pick up again following the effects of the government’s recently announced economic stimulus packages. The packages will likely revive lending growth, the bank’s senior executive has said. Citibank Indonesia CEO Batara Sianturi said that the recent economic packages released by the government and the positive feedback from US President Barack Obama upon meeting with President Joko “Jokowi” Widodo in Washington DC would boost growth in real sectors in the near future. “The growth of banking depends on the growth of real economic sectors. So from the existing facts, we’re optimistic that there will be growth in 2016 in real sectors that will in turn affect the banking sector as they will need more lending,” Batara said during the launch of Citibank’s Smart Branch in Pantai Indah Kapuk in North Jakarta on Friday.
BBL looks at potential in Myanmar Bangkok Post 3rd Nov 2015
Bangkok Bank (BBL) intends for its new Myanmar branch to be among its top five lenders outside Thailand by 2020, in line with rapid growth in the neighbouring country. Thailand's second-largest commercial lender by assets upgraded its representative office in Yangon, which has been operating for 20 years, to a branch in June after it won a foreign branch licence from the Myanmar government. It was the only Thai bank to be granted a licence. "Myanmar has high potential, with rapid GDP growth, rich land and natural resources, and a large population officially estimated at 60 million," BBL president Chartsiri Sophonpanich said, adding that the Yangon branch's loan portfolio remained minimal.
Loans to consumers surged 19% in H1 Philippine Daily Inquirer 3rd Nov 2015
Growth in loans by banks to consumers for increased credit card use, as well as the purchase of new homes and cars, rose by a fifth at the end of June, outpacing the expansion the industry’s total portfolio. This reflected local banks’ eagerness to get more cash in consumers’ hands—an area of the business promising fat yields despite heightened competition. Data from the Bangko Sentral ng Pilipinas (BSP) showed consumer loans rose by 19.29 percent at the end of the first half to a record high of P959.18 billion. Consumer loans were up 2.83 percent from March, sustaining the quarter-on-quarter growth since 2008. In contrast, outstanding loans of the country’s major banks rose by 14.5 percent at the end of June. “BSP monitors the level and quality of consumer and other bank loans to ensure banks’ adherence to high credit standards,” the regulator said.
BII Bank Officially Becomes Maybank Indonesia Tempo 2nd Nov 2015
PT Bank Internasional Indonesia (BII) officially changes its identity to PT Bank Maybank Indonesia today, November 2. The company is also rebranding by changing its overall logo and tagline, inline with the company’s main office logo Malayan Banking Berhad (Maybank). “This change with make Maybank bigger, better and stronger,” Maybank Indonesia CEO Taswin Zakaria said in Maybank Indonesia central office in Senayan Jakarta on Monday, November 2. Taswin said the rebranding process in all Maybank Indonesia network offices were estimated to be completed in Q1 2016. The identity change has been approved by its regulator, Financial Service Authority.
Banks' loan growth spoiled by business loans’ unexpected slip Singapore Business Review 2nd Nov 2015
Loan growth simmered down to 0.6%. Singapore banks’ loan growth could have had a smooth sailing season, but business loans couldn’t build on its three straight months of growth, as they defied analysts’ predictions and fell by 1.0% yoy. According to analysts from OCBC, building and construction loans showed better promise, accelerating to 20% yoy. However, OCBC says this was offset by loans to financial institutions, manufacturing, and general commerce, which fell 15.8%, 11.3%, and 8.2% respectively. OCBC adds that the business loans slip is also the first on-month decline since April 2015, indicating faltering business confidence in the last six months.
Short-term rates to remain steady on BNM’s intervention Malaymail 2nd Nov 2015
Short-term interbank rates are expected to remain stable today with Bank Negara Malaysia (BNM) intervening to absorb excess liquidity from the financial system. BNM estimated today’s liquidity at RM38.09 billion in the conventional system and RM12.64 billion in Islamic funds. The central bank will conduct a conventional money market tender of RM4.5 billion for seven days and a Qard of RM1.1 billion for seven days. BNM will also conduct a commodity murabahah programme tender of RM1.6 billion for 14 days and a repo tender of RM600 million for 45 days.
Banking restructuring ramps up activities VietnamPlus 2nd Nov 2015
The banking system is racing against time as its major restructuring enters its last phase. It devised a roadmap to restructure credit organisations at the end of 2011, and began implementing the regulations in February 2012. These were the earliest projects under the national economic overhaul. Following the blueprint, the system has yielded positive outcomes, but the overall pace remains slow and requires drastic moves to meet the deadline. Earlier this year, State Bank of Vietnam (SBV) Governor Nguyen Van Binh said several merger and acquisition (M&A) deals would take place, including some between healthy banks in order to expand their scale and boost their performance.
Public Bank acquires remaining 60% in PB Trustee Services The Star Online 2nd Nov 2015
The Public Bank group, through three wholly-owned subsidiaries, has acquired the remaining 60% equity interest in PB Trustee Services Bhd for RM13.86mil in cash. Prior to the acquisition, Public Bank and its unit Public Investment Bank Bhd each held a 20% equity interest in PB Trustee. Public Bank Bhd said in a statement to Bursa Malaysia that Public Bank’s units - Public Consolidated Holdings Sdn Bhd, Public Holdings Sdn Bhd and PB International Factors Sdn Bhd - from Public Nominees (Tempatan) Sdn Bhd and a group of companies (THP related companies) in which Public Bank chairman Tan Sri Dr Teh Hong Piow is a shareholder. The THP related companies, namely Kayakita Corp Sdn Bhd, Selected Securities Sdn Bhd, Selected Holdings Sdn Bhd, and Kepunyaan Perindustrian Sdn Bhd, collectively owned 47.35% in PB Trustee while Public Nominees, for the beneficial interests of Public Bank Group Officers’ Retirement Benefits Fund, held a 12.65% stake.
Consumer loan growth to remain weak next year Jakarta Post 2nd Nov 2015
The growth in consumer loans by local banks is expected to continue to be weak next year despite a series of economic stimulus packages launched by the government recently, according to the National Banks Association (Perbanas). Perbanas chairman Sigit Pramono said the government’s economic stimulus packages would have a positive effect on reviving the country’s economy, but it would take time for them to have an impact on people’s buying power. Sigit said demand for consumer loans, such as mortgages and automotive lending, would only start to pick up when there was growth in the industrial sector. “We can see that middle-income people’s demand for mortgages as well as apartment and vehicle loans has started flagging, so we predict consumer lending will probably grow by less than 10 percent next year, or flat compared to this year,” Sigit said recently.
Quick, easy and in places the banks can’t get to The Phnom Penh Post 2nd Nov 2015
Growth in money transfer services – used to send money home to the provinces – is being driven by internal migration and mobile phone penetration Chhen Sarath works at a bank, but when the time comes to send money home to his parents in Kampot province, he heads to a money transfer booth in Phnom Penh’s Olympic Market. On this particular day he pulls $50 out of his wallet and hands it to the booth’s Wing agent. The domestic remittance service is quick and cheap, providing an alternative to both banks and informal agents, according to Sarath. “It’s fast and the fee is not high,” he said, adding that the service is convenient because the company’s network of 4,000 agents means his parents do not need to travel a long way to pick up the money.
Singapore's 20 largest commercial banks 2015 Singapore Business Review 1st Nov 2015
While Singapore banks may be feeling celebratory that loan growth has recovered somewhat from the first half of 2015, business loans will continue to be a party pooper. Singapore banks are expected to have a rough third quarter as business loans remain depressed amid slower economic growth locally and across Asia. “With the economy mired in the doldrums – real GDP growth reflected a contraction of 4.6% in quarter-on-quarter, seasonally adjusted, annualized terms in the second quarter of 2015, we see little prospect of a significant pick-up in lending growth over the coming quarters,” says BMI Research. Following a forecasted dip in loans in the second half of 2015, BMI Research forecasts overall loan growth to come in at just 3.0% for the full-year compared to the faster 5.8% growth clip in 2014. Analysts point to anemic business loan growth as a major headache for Singapore banks. Business loan growth has been steadily moderating since last year’s double-digit pace. “Macroeconomic headwinds in Singapore and regional countries have dampened business sentiment, causing system loan growth to slow to 3.5% YoY in May,” says the RHB Singapore Research team.
Focus on key markets, technology and talent New Straits Times 31st Oct 2015
CIMB Group, Malaysia’s second largest bank with a deep presence in Asean, has identified three key markets that will shape the group’s future growth in the region. The first is Indonesia, where it’s CIMB Niaga has had to deal with high provisions for non-performing loans (NPLs) due to lower commodity prices, especially coal. “When Indonesia's economy picks up, then CIMB Group will benefit. We would be the main beneficiary among the banks in the region. We have the biggest exposure in Indonesia. If it comes back, you can see our numbers improve a lot,” Tengku Datuk Seri Zafrul Abdul Aziz said. In an exclusive interview with the New Straits Times Press group, the 42-year-old group chief executive officer was confident that the Indonesian operations would be able to recover.
Bank Negara’s ruling on FHC may alter banking landscape The Star 31st Oct 2015
Largely ignored by the masses, a guideline issued by Bank Negara on Oct 13 may change the banking industry landscape and has deep ramifications for some of Malaysia’s largest public-listed companies. These companies are the financial holding companies (FHCs) of banks, which only in recent years have come under the scrutiny of the authorities by virtue of the Financial Services Act 2013 (FSA). The Basel III Accords, which include some of the world’s strictest banking regulations, are set to be fully adopted in Malaysia by 2019. This ruling essentially forces banks and financial institutions to create a “capital buffer” that can be tapped in times of crisis such as the one that befell American banks in 2008.
Foreign parties can enhance banking M&A The Star 31st Oct 2015
The increasing capital calls on local banks and financial holding companies (FHCs) is a natural catalyst for more merger and acquisition (M&A) activities in the sector. At the same time, it’s no longer fun to own a bank. Increased regulation and capital calls combined with a bleak business outlook should mean that there must be better ways to invest your millions if you were a major shareholder of a bank. Of course, that’s just layman thinking. Some owners of banks know that it’s a privileged place to be and tend to take a longer-term view of things. Still, the capital calls can be hefty. And with the increasing preference for the institutionalisation of the shareholding of banks, the question does arise if there’s a need to have a bigger foreign participation in the ownership of our local banks.
South Korean bank starts Philippine operations Business World 30th Oct 2015
Seoul-based Shinhan Bank has started operations in Manila this month after securing the green light from the Bangko Sentral ng Pilipinas (BSP). The central bank on Sept. 24 issued a Certificate of Authority to Operate to the Korean bank, according to Circular Letter 2015-066 that was signed by BSP Deputy Governor Nestor A. Espenilla, Jr. on Oct. 28 and subsequently uploaded on the BSP Web site. Shinhan Bank formally started its operations in the Philippines on Oct. 19, the circular noted. The Korean bank is among foreign financial institutions that have sought to enter the Philippines following the enactment of a law further liberalizing the entry of banks from abroad.
Singapore September bank lending dips on lower financial, commerce loans The Straits Times 30th Oct 2015
Singapore's total bank lending in September fell from the previous month on declines in loans to financial institutions and general commerce, data from the Monetary Authority of Singapore (MAS) showed on Friday (Oct 30). Loans and advances by domestic banks amounted to $608.3 billion last month, according to data from the Monetary Authority of Singapore. That compared was 0.6 per cent lower than the S$613.5 billion in August. Year-on-year, September bank lending grew 0.6 per cent from S$604.5 billion in September 2014. Housing and bridging loans in September increased to $182.9 billion from $182.0 billion in August. These loans totalled $174.5 billion in September 2014.
BOT tells banks to tighten IT security The Nation 30th Oct 2015
The Bank of Thailand yesterday asked all commercial banks to tighten IT security and be ready to cope with any invasion of their online services, while continuing close monitoring. Recently, some commercial banks received an email from an unknown person from a foreign country, threatening to target their network and overwhelm their online services with traffic, which could affect their Internet services. Tongurai Limpiti, a deputy governor at the central bank, said the central bank and commercial banks focused on risks to the information technology system of each commercial bank, adhering to customer data security and precision, and a system ready for continuous use. The central bank also asked all commercial banks to have measures in place if such a situation arises so as to lessen the impact on their customers.
Liquidity, bank lending growth slow in September Business World 30th Oct 2015
Money supply and bank lending continued to grow last month, though at a slower pace, the Bangko Sentral ng Pilipinas (BSP) said in a statement on Friday. Domestic liquidity or M3 -- the broadest measure of money circulating in an economy -- grew by 8.5% year-on-year in September to P7.8 trillion, though this pace was slower than the 9% expansion recorded the previous month. Month on month, M3 edged up by a nearly flat 0.1%. The central bank said money supply’s continued expansion was “due largely to sustained demand for credit.” Domestic claims grew 12.4% to P7.4 trillion last month, slower than August’s 13% increase. ”Credits to the private sector increased at a slightly slower pace relative to the previous month,” the central bank noted.
Banking group expects bad loans to top out in 2016 Bangkok Post 29th Oct 2015
The banking industry's non-performing loans (NPLs) are expected to peak above 3% of loans outstanding by year-end 2016 as a result of the slow economy, says Thai Bankers' Association (TBA) chairman Boontuck Wungcharoen. At the end of the third quarter this year, overall industry NPLs stood at 2.79%, up from 2.38% in the previous quarter. The normal time lag for an economic slowdown's impact on bad loans is 12 months, Mr Boontuck said. But he said the rising pace of NPLs from the fourth quarter of this year to the end of 2016 would slow down in line with the recovery of the Thai economy. Under the scenario, the industry is expected to require additional reserves for loan losses, but the additional provision amount will not affect Thailand's banking business, which will maintain a strong coverage ratio of 130%.
Bad Credit Pushes Bank Mandiri to Increase Backup Funds Tempo 29th Oct 2015
State bank PT Bank Mandiri Tbk has increased the backup fund for its third quarter non-performing loan (NPL) by 160 percent. President director Budi G. Sadikin said on Thursday, October 29 that the decision was made there are still plenty of non-performing credits. The condition has caused Mandiri's consolidated net income margin (NIM) to grow just by 0.9 percent, with a net profit growth of 3.0 percent. "This is the result from the money we put aside as credit backup," Budi said. Mandiri's NPL ratio currently stands at 2.4 percent while its consolidated NPL is 2.81 percent. "This is happening in all sector, but mostly on the commodity sectors like coal and oil," he said.
Maybank Indonesia’s earnings soar The Star 29th Oct 2015
PT Bank Maybank Indonesia Tbk (formerly PT Bank International Indonesia) reported a 70.7% jump in net profit for the nine-month period ended Sept 30, 2015 to 592 billion rupiah (RM188.7mil) from a year ago, despite weakening asset quality. “The strong performance for the nine months of 2015 was achieved on the back of improved net interest income, better net interest margin (NIM), higher fee-based income, solid growth in liquidity especially in current accounts, and an outstanding achievement in syariah banking,” said the bank, which is 80% owned by Malayan Banking Bhd and listed on the Indonesia Stock Exchange. In a statement released in Kuala Lumpur, it said that net interest income rose 10.5% to 4.8 trillion rupiah (RM1.52bil) in September, as the bank’s NIM improved to 4.82% from 4.63%.
Maybank expands in Sarawak The Star 29th Oct 2015
Maybank has expanded its network in Sarawak to 27 with the launch of its latest branch in Matang Jaya, nine kilometers from Kuching. The branch offers a full range of conventional and Islamic products, Self Service Banking Terminals (SSTs) consisting of two ATMs and a cash deposit machine, business financing as well as general and life insurance and investment products. Maybanks head of community financial services Malaysia, Hamirullah Boorhan, said the new branch was part of the bank’s strategy to strengthen its footprint in newly developed townships. “It is also in line with our mission to humanise financial services by providing customers easy access to banking services.
French Firm Atos Launches Banking Solution in Myanmar Myanmar Business Today 28th Oct 2015
French IT services company Atos SE has signed a partnership agreement with Myanmar Millennium Group (MMG) to foray into Myanmar’s financial sector. The agreement between Atos and MMG will facilitate the introduction and deployment of Atos Banking as a Service (BaaS) solution to accelerate future expansion of the banks and financial institutions and the services to support the anticipated growth in Myanmar, Atos said in a statement. Atos BaaS is a banking platform that manages and supports the full spectrum of banking operations, from current and savings accounts, deposits, to credits, loans and collections. It also supports services as sweeps, standing instructions, direct debits and credits and international payments. Atos said it will offer banks in Myanmar a solution to supplement their core platforms that includes consulting and design services, applications transformation, rationalisation and migration, testing and acceptance management, comprehensive security and access management services, smart mobility and contextual services and IT outsourcing, data management and applications management. Atos said these solutions are modular and standards-based, and therefore, can be customised to fit the bank’s specific growth needs as well as its existing infrastructure and application platforms without the need for upfront capital investment or the disruption of a costly re-engineering project.
E-Payments
BNM wants alliances to boost e-payments industry The Star 3 Nov 2015
Bank Negara Malaysia wants the banking and payments industry to look into forming strategic alliances with non-traditional partners to boost the e-payments industry. The central bank’s deputy governor, Datuk Muhammad Ibrahim on Tuesday cited the recent partnerships between banks and telcos in the roll-out of mPOS as a good example of such new partnership. “We have now reached a critical juncture in our migration to e-payments. With the enabling environment in place and the encouraging progress recorded for the past five years, emphasis should now be devoted towards implementation and facilitating behavioural change among individuals and businesses,” he said.
BI joins telco companies and 'pesantren' for e-money project Jakarta Post 31st Oct 2015
Bank Indonesia (BI) has teamed up three cellular providers with two Islamic boarding schools (Pesantren) to develop a digital financial service project, in a bid to broaden financial service usage among the Muslim community. Telkomsel, Indosat, and XL Axiata inked the memorandum of understanding (MoU) with the two Pesantren; Daruut Tauhiid in Bandung, West Java and Al-Mawaddah in East Java. The agreement was witnessed by witnessed by BI’s Deputy Governor Ronald Waas. “We consider this effort to bring together the Pesantren and the communications companies to have promising potential. Thus, we have launched an initiation to facilitate between them and the issuer of electronic money through digital financial services,” said Ronald in Surabaya on Friday. The service, he further explained, involved cellular providers as the third parties that managed the technology. This breakthrough answered the desire to broaden financial service access, he said, which was in line with BI’s Islamic financial inclusion program. In Daruut Tauhid, the collaboration will allow the cellular provider to conduct electronic payments and e-money transactions in the Pesantren, while in Al-Mawaddah the cellular providers will facilitate the electronic payment of the tuition fee. Perry said that the Pesantren, with their publicly acknowledged leaders and the vast student alumni network, could play a significant role in developing sharia-based financial service development in the world's largest Muslim majority country.
30 percent of Vietnamese population to join online shopping by 2020 VietnamPlus 2nd Nov 2015
The Vietnam E-commerce and Information Technology Agency (VECITA) under the Ministry of Industry and Trade set a goal to get 30 percent of Vietnamese people shopping online by 2020. It also aims to bring annual e-commerce sales to an average of 350 USD per person . In order to boost online consumers’ and businesses’ confidence, VECITA is improving legal frameworks for e-payments and logistics services, as well as developing corresponding application solutions, said Tran Huu Linh, head of VECITA. Linh said current legal frameworks and infrastructure do not meet rising demand for e-commerce growth, adding that the revenue from the field is estimated to reach 4 billion USD in 2015.
ASEAN Region: PH is 3rd in E-Trade; Credit Card Use Slow Malaya 2nd Nov 2015
The Philippines has emerged among the top three markets in six Southeast Asian countries served by pioneering electronic commerce company Lazada, despite the challenges that hinder the adoption of e-commerce in the country. In an interview, Inanc Balci, chief executive officer of Lazada Philippines, said the company now has a commanding 80 percent market share in the e-commerce industry, excluding food and travel, just three years since it was launched in the country. Balci said the e-commerce landscape in the Philippines is faced with three major challenges: a low credit card and debit card penetration rate, trust issues of shoppers in online shopping and logistics problems. This is why e-commerce companies like Lazada have to device ways to address those concerns and allow this format of shopping to flourish. Compared to Singapore and Indonesia which have both attracted the big players in e-commerce, the Philippines still has a long way to go in e-commerce.
Banking on cashless transactions The Phnom Penh Post 30th Oct 2015
With Cambodians beginning to embrace online shopping and other e-commerce activities, there is a pressing need for local online payment platforms similar to PayPal or Stripe to process their transactions. Bongloy, a homegrown online payment gateway, was developed to replace the prevalent cash-on-delivery system currently favoured by Cambodian e-commerce businesses, enabling them to go completely online. The Post’s Ananth Baliga sat down with former Silicon Valley startup consultant David Wilkie, managing director of Bongloy, to discuss the experience of developing a payment platform in Cambodia and the growing demand for online payment processing.
Insurance
Myanmar: Marsh opens rep office in Yangon Asia Insurance Review 3rd Nov 2015
Marsh, a global leader in insurance broking and risk management, has opened a representative office in Yangon. The Marsh Singapore Yangon Representative Office will conduct market research and feasibility studies for insurance broking business in Myanmar, and provide business support and liaison activities on behalf of Marsh Singapore’s businesses. The office was declared open last week in a ceremony officiated by Dr Maung Maung Thein, Union Deputy Minister, Ministry of Finance and Revenue, and Mr Martin South, Chief Executive Officer, Marsh Asia Pacific, as well as other guests.
SIRC: Bilateral meetings in full swing Asia Insurance Review 3rd Nov 2015
Even before the official start of the 13th Singapore International Reinsurance Conference (SIRC) today, the bilateral meetings and networking at the Marina Bay Sands was a veritable marketplace for the reinsurance renewal season with 1,000 registered delegates. This year’s Lloyd’s Coffee House and the respective bilateral meeting rooms were buzzing by 9am yesterday and will run for three full days
Insurance firms’ 9-month premium income surges Business World 2nd Nov 2015
The insurance industry’s total premium income rose by almost 30% in the first nine months of the year, buoyed by the continued expansion of both life and non-life companies. The Insurance Commission (IC) in a statement said the industry’s total income from premiums for the January to September period jumped 29.75% to P172.40 billion from the P132.87 billion posted during the same period last year. Preliminary data based on quarterly reports submitted by the life and non-life companies to the insurance regulator also showed the industry’s total net income rose 65.8% to P20.41 billion in the first nine months of the year, from P12.31 billion a year ago. The IC attributed the strong profit growth to the increase in underwriting income and investment income. The insurance industry’s total assets for the period stood at P1.09 trillion in the first nine months of 2015, up by 10.10% or P0.99 trillion.
Asean: Cambodian exec wins Young Asean Insurance Manager Award Asia Insurance Review 2nd Nov 2015
The Young Asean Insurance Manager Award 2015 (YAMA) has been awarded to Ms Oudamsoriya Hun, Head of Legal & Corporate Integrity, Prudential (Cambodia) Life Assurance. The award was presented to Ms Hun during the closing dinner of the 18th Asean Insurance Regulators Meeting (AIRM) & the 41st Asean Insurance Council (AIC) Meeting in Phnom Penh last week. The award honours outstanding young managers from the Asean region for their achievements, contributions and dedication in the insurance industry. The accolade is also meant to encourage, motivate and inspire other managers to become leaders in the Asean insurance sector.
Indonesia: Haze to spark off surge in insurance claims Asia Insurance Review 30th Oct 2015
The Financial Services Authority (OJK or Otoritas Jasa Keuangan) has said that the haze disaster resulting from forest fires in several provinces in Indonesia is likely to trigger a surge in insurance claims. OJK director of non-bank supervision Firdaus Djaelani said that the insurance industry will be affected by a number of economic activities that are forced to stop because of the haze, reported Bisnis Indonesia. According to Mr Djaelani, so far no insurer has reported massive claims, but the claims usually flow in well after the disaster ends. "Certainly there will be an increase in claims, but it will not happen suddenly and at once. Right now, the smoke disaster is still happening so we cannot make an estimation yet," he said.
Singapore to exceed regional hub goal to become a leading global hub Asia Insurance Review 29th Oct 2015
Singapore is well placed to exceed its initial goal of becoming the leading regional insurance hub to become one of the leading insurance hubs of the world, said a Singapore government official at the launch of Great American Insurance Group's Singapore branch office - its first in Asia. Madam Halimah Yacob, Speaker of Parliament, Singapore, said that in the next five years, emerging Asia is projected to grow and holds a wealth of potential. Munich Re projects that Asia will account for 40% of the global insurance market by 2020, while five of the top 10 primary growth markets will be in Asia Pacific. The government had set the goal to make Singapore the leading insurance hub in the region nearly two decades ago. Over the years, the government has worked with insurers to build Singapore into a leading insurance hub in Asia.
Market Regulation
OJK seeks to ease requirements for state firms to go public Jakarta Post 3rd Nov 2015
The Financial Services Authority (OJK) is seeking to make it easier for state firms to go public on the Indonesian Stock Exchange (IDX) by cutting the steps necessary to do so. OJK commissioner for capital market supervision Nurhaida said that the 25 steps needed for a state-owned enterprise (SOE) to hold initial public offerings (IPOs) would be reviewed and shortened to simplify the process. The procedure for state firms to go public was still longer than the procedure for private firms, Nurhaida said, leading to reluctance to do so among SOEs. Going public, she went on, was necessary not only for SOEs to potentially increase their capital, but also to accelerate financial market expansion and increase the liquidity of the stock market.
E-commerce regulation to be ready in January Jakarta Post 3rd Nov 2015
The Trade Ministry is hoping that a regulation on e-commerce activities will be implemented in January, emphasizing that implementation will mean that all business players in the e-commerce sector will have a stronger legal base to carry out their operations. Widodo, the ministry’s director general for standards and consumer protection, said Monday that the draft regulation, which contains the requirements for companies involved in e-commerce to register their operations and to meet the Indonesian National Standards (SNI) for their products, was currently being finalized. “The draft regulation should be finished this year,” he said before going on to explain that, so far, the regulation for e-commerce trade had been limited to the Consumer Protection Law, which stipulates that the ordered goods must live up to what has been promised.
Asean: Regulatory harmonisation must go hand in hand with liberalisation Asia Insurance Review 30th Oct 2015
Greater consistency in regulatory standards among the 10 Asean states is crucial to facilitate liberalisaton of the insurance sector in the region, said Mr Aun Porn Moniroth, Minister of Economy & Finance, Cambodia, at the joint opening of the 18th Asean Insurance Regulators Meeting (AIRM) and 41st Asean Insurance Council (AIC) Meeting held in Phnom Penh this week. “Regulatory differences raise the cost of cross border services, and compliance cost for different set of rules can be high… thus hindering insurance market integration in Asean. The AIRM is a useful platform to work closely together to bring about consistency and clarity on the insurance regulatory framework in Asean,” said Mr Moniroth. He also stressed the importance of capacity building among regulators through consultation and sharing of experiences among the various Asean supervisors.
Indonesia: Finalised cession rules expected to be widely accepted by market Asia Insurance Review 29th Oct 2015
The Financial Services Authority (OJK or Otoritas Jasa Keuangan) has finalised its set of rules on domestic cession in its aim to "improve and optimise capacity in the country". The new rules are expected to be largely welcomed by industry players after intensive engagement and feedback gathered from the market, said OJK officials. The regulations mandate that an insurance company “must have and implement its own retention for every risk managed in accordance to its own retention limits”, said OJK Director of Insurance Supervision, Mr Darul Dimasqy, at the Indonesia Rendezvous in Bali earlier this month.
SGX raises transaction disclosure requirement The Straits Times 28th Oct 2015
The rule requiring companies to keep a list of certain transactions which contain details of parties who are privy to the deal so the Singapore Exchange can undertake more efficient investigations will soon be widened. Currently, the privy list is needed only for what are known as significant transactions, such as takeovers or major acquisitions. But from Dec 1, the rule will apply to all material transactions, the bourse announced yesterday. Material transactions are those that can have a tangible impact on a company or its share price, including significant transactions such as acquisitions, or smaller events such as loss of a major contract. The list, which was implemented in March last year, will remain confidential, with only the SGX enabled to request it for regulatory purposes, chiefly insider-trading investigations.
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