(Yicai Global) June 19 -- Singapore-based Oversea-Chinese Banking Corporation, better known as OCBC Bank, plans to develop a new strategy and invest SGD200 million (USD147 million) in Guangdong-Hong Kong-Macao (GHM) Greater Bay Area by 2023 to boost profits.
Singapore’s second-largest bank aims to achieve USD1 billion in pre-tax profits in the next five years, doubling its current profits from the Greater Bay Area, reported Lianhe Zaobao, the biggest-selling Chinese-language newspaper in the southeast Asian country, today, citing a senior bank executive.
OCBC Bank has more than 3,000 employees and extended customer loans worth about SGD35 billion in the Greater Bay Area, which generated a pretax profit of SGD500 million last year, said Samuel Tsien, chief executive officer of the group, in a press conference about the bank’s regional strategies held in Hong Kong.
The Greater Bay Area encompasses major cities in the Pearl River Delta including Guangzhou, Shenzhen, Zhuhai, Foshan, Huizhou, Dongguan, Zhongshan, Jiangmen and Zhaoqing, all in the southeastern Guangdong province, as well as special administrative regions, Hong Kong and Macau. Though accounting for no more than 1 percent of China’s land area and with no more than 5 percent of its talents, the Greater Bay Area has contributed over 10 percent to China’s GDP last year.
OCBC Bank will invest SGD200 million in its franchise in the Greater Bay Area to realize its target pre-tax profit level by 2023, said Tsien, with two-thirds of the planned investment in science and technology and one-third in talents. It also aims to raise the total amount of customer loans by 15 percent and add 1,200 new employees to the workforce, a 40 percent increase.
OCBC Bank remains optimistic about the potential for growth in the Greater Bay Area, Tsien said. Favorable macro-economic factors include strong support from the government, continuous internationalization of the yuan and the area’s unique geographic location.
In the next decade or so, the annual gross domestic product, GDP, in the region is expected to grow at a rate of 7 percent to 9 percent. Private businesses, especially in the high-tech industry, have been on the fast track, and commercial banks and wealth management opportunities have emerged, Tsien added.
In the future, OCBC Bank will proactively help increase transactions and capital and wealth exchanges between the Greater Bay Area and other regions. It will particularly assist clients in the Association of Southeast Asian Nations, ASEAN, Hong Kong and Taiwan to expand their presence into the area, and will help customers at the Pearl River Delta find business opportunities in the ASEAN countries, Hong Kong and Taiwan.
In addition, OCBC Bank also evaluates the feasibility of providing onshore private wealth management services and expanding fund management business. The bank does not see these measures in direct competition with local banks, Tsien said. Instead of selling the same type of products, OCBC Bank provides diversified and appealing portfolios to satisfy high net worth clients, he added.
Editor: Mevlut Katik