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It is no exaggeration to say Asia’s banking scene is the world’s most vibrant. In Asia, banks are fighting to bring in a wide swath of new customers, and not just the richest ones. Chalk that up to two elements Asian banks are benefiting from: A rising middle class across the region is introducing millions of new potential customers to consumer banks, and no other region in the world has a population that is so open to using everyday technology like mobile phones to organize their financial lives.

From a confectionary worker in Vietnam to a farmer in Myanmar to a worker in a chip foundry in Taiwan, banking customers are welcoming tech innovation, and banks are falling over themselves to offer it.

On the corporate side, the scene is changing in exciting ways as well. China’s state megabanks are (finally) internationalizing, as witnessed by China Construction Bank’s recent vow to open branches in eight new countries this year. These banks are following their mainland customers as they step up their overseas businesses. Both constituents are pushing China’s currency, the renminbi, closer to reserve currency status, as cross-border payments accelerate and capital restrictions in China ease.

All-in-all, banking in Asia is in an exuberant phase.

Regional Winner | ANZ Group

It’s tough to find a corner of finance in the Asia-Pacific where ANZ has not made its mark. ANZ operates in 29 countries across the region and is looking to complete the set by starting up operations in Myanmar and Thailand.

ANZ is one of the leading loan houses in Asia, ranked second only to Standard Chartered in 2014, with 57 deals totaling $7.5 billion in G3 (euro, dollar, yen) currencies, according to Dealogic. With one of the largest loan syndication teams in the region, ANZ is in position to leverage this franchise to continue building out its presence in acquisition finance, export and project finance and corporate advisory. 

One slice of the deal pie that ANZ wants to capture is greater China outbound M&A into Australia, as the Australian dollar is expected to remain weak and the drop in global commodity prices has made many businesses in the country attractive takeover targets.

The bank is also trying to translate regional expansion into better electronic banking service for corporate customers. In early March, ANZ won Celent’s Model Bank Award for payments innovation as it has expanded its common platform across the region.

The banking group could be on the cusp of a new phase of expansion. As of late March, ANZ has been mulling a buyout of the Asian regional assets of Royal Bank of Scotland, which is in the midst of downsizing. Any acquisition would help it vie against much bigger global rivals HSBC and Citigroup.

Michael Smith, CEO

Afghanistan | Afghanistan International Bank

Afghanistan International Bank (AIB) was founded in the war-torn nation at the behest of the Asian Development Bank (ADB), with shareholders that include, besides ADB, Horizon Associates and Wilton Holdings, part of Pakistan’s Rahmat Group, a trading house. Endurance and reliability have underscored its growth—it has established 17 branches in the greater Kabul area and has introduced such “leap-frog” banking services as mobile phone access to accounts and services, bringing in customers that have never had exposure to branch banking.

Khalilullah Sediq, CEO

Armenia | Ameriabank

Ameriabank opened a branch in rural, remote Syunik province in March, offering an “I love Syunik” card that includes such benefits as a 1% discount on Internet banking services. Its expertise in bringing customers into 21st-century banking is only one aspect that has marked Ameriabank’s rise. It is the only universal bank in the country offering corporate and retail banking. Profits grew 17% to 7.1 billion drams ($15 million) in 2014.

Artak Hanesyan, CEO

Australia | ANZ Group

ANZ Group has become such a familiar banking force in Asia, it is sometimes overlooked that it is one of Australia’s biggest lenders. The bank reported a record full-year profit of $6.4 billion for its fiscal year ending September 2014. While the gains came in part from Asian operations, they reflected strong performance at home, where ANZ outshined other “big four” members. ANZ is the nation’s third-largest bank by market value. One of the reason for the record profit from ANZ: significant reduction of bad debt expenses, a sign that the bank has successfully built out its system of controls.

Michael Smith, CEO

Azerbaijan | Accessbank

In April 2014, Accessbank obtained a $60 million syndicated loan from a group of select European banks, the first international loan to an Azerbaijani bank without the help of a multilateral lender. The bank is using the proceeds to step up its microcredit program to foster growth in the SME sector, where businesses, outside of oil and gas, lack access to capital.

Michael Hoffmann, chairman

Bangladesh | City Bank

City was formed with four other banks in 1983 as a participant in the national program to introduce a modern banking system. It is unique in Bangladesh for its centralized structure based on information technology, with a platform that unifies and shares essential data from five units: business banking, branch banking, risk oversight, operations and customer support. Most other banks in Bangladesh have a decentralized structure with an emphasis on regional management. City Bank’s centralized approach allows it closer monitoring of risk performance and cross-selling opportunities. Currently, it operates 112 branches, 99 of which have online services; one full-fledged Islamic banking branch; an SME service center; and 11 SME agricultural lending branches.

Rubel Aziz, chairman

Brunei Darussalam | Bank Islam Brunei Darussalam

Bank Islam Brunei Darussalam (BIBD) grew its market share 3.2% in the first nine months of 2014, with a 7% increase in revenues and 16% growth in profits during the period, as compared with the previous year. Its total number of retail customers reached 243,966—a net increase of 10,500 customers from year-end 2013. The strong expansion reflects BIBD’s emphasis on improving sales and customer touch points in the oil rich nation. Its retail banking division is expanding rapidly.

Javed Ahmad, managing director

Cambodia | ABA Bank

Bank of Canada revealed in January 2015 that it had increased its stake in Cambodia’s ABA Bank to 42% from 10%. The Canadian bank said that it did so because the small- to medium-enterprise sector in Cambodia is growing fast and ABA was best in position to take advantage of the boom. The bigger stake has given ABA Bank the backing it needs to fulfill its growth ambitions, with plans to own 40 branches by 2017 from a current 27.

Damir Karassayev, chairman

China | China Construction Bank

The legacy state infrastructure finance bank is now an international player. CCB announced in late March that it would set up branches in eight countries in 2015—in France, the Netherlands, Poland, Italy, Spain, Switzerland, Chile and Malaysia. While most of China’s big state-owned banks are following business and consumer customers overseas, CCB leads its peers in developing cross-border services in renminbi payments and trade and banking services. At home, it will have to safeguard against erosion of its net interest margin following successive rate cuts by China’s central bank. But CCB has proven equal to this task before.

Wang Hongzhang, chairman and executive director

Georgia | TBC Bank

When TBC Bank sought to raise funds in June 2014, it opted for a London IPO of global depositary receipts, raising $640 million. That proved it had the confidence of global investors; it has also been winning the loyalty of customers at home. A reassuring shareholder base, including JPMorgan Chase and the EBRD, has helped TBC build public confidence. It became the largest retail bank in Georgia in fourth quarter 2014, with a 27.7% market share of total loans in the country.

Vakhtang Butskhrikidze, CEO

Hong Kong | Hang Seng Bank

Hang Seng has a reputation for building value the durable way. It’s well earned. Hang Seng has been slow to ratchet up lending in China, unlike most of its Hong Kong competitors. But it has proven that it knows how to make a good call on the mainland. It announced that it will sell 5%, or about half of its stake, in Shanghai-listed Industrial Bank for $2 billion, garnering a handsome profit. It will use the proceeds to shore up capital. But Hang Seng is retaining 5.9%, with a vow to regularly review the value of its investment. 

Rose Lee Wai Mun, vice chairman and chief executive

India | State Bank of India

Call it the Modi factor. The nation’s biggest lender by assets, State Bank of India (SBI) said it would issue up to $2.4 billion in new shares by the end of April 2015. How will it use the money? SBI led the way in digital innovation in India, bringing mobile access to banking services in the countryside to millions over a period of five years since 2011. It will continue expanding this initiative, and at the same time shore up its capital base. SBI chairperson Arundhati Bhattacharya is ruffling feathers by talking about outsourcing some jobs for the ultimate goal of better services and efficiencies.

Arundhati Bhattacharya, chairman

Indonesia | Bank Mandiri

Bank Mandiri, Indonesia’s largest lender by assets, enjoyed 9.2% profit growth in 2014 and maintained a robust net interest margin, despite a challenging year for Indonesian banks. The bank has been expanding at the expense of competitors, growing its loan portfolio by 12.2% in 2014. It plans to best that figure this year with gross loan growth of 15% to 17%. It will have to keep an eye on controls, as nonperforming loans have edged up: They now constitute 2.15% of total loans, versus 1.9% at the end of 2013.

Budi Sadikin, CEO

Japan | Shinsei Bank

You can’t applaud the Shinsei Bank of today without understanding its roots. Shinsei’s predecessor was the Long-Term Credit Bank of Japan, which collapsed and was nationalized 1998. The government injected funds for its survival, and it became Shinsei, under new management and substantial new investment by foreign interests. The rescue worked, but eventually Shinsei expanded too fast and ran into asset quality problems, with dicey credits like nonrecourse real estate and leveraged finance loans burdening its books. After a change in management and systems, and now into its second major medium-term management plan, Shinsei has finally navigated its problems; Moody’s upgraded its long-term debt to positive in January.

Shigeki Toma, president

Kazakhstan | Kazkommertsbank

The largest nonstate bank in Kazakhstan by market share, Kazkommertsbank has gained its 24% slice of the total banking market by proving itself more competitive than state institutions. Recently KKB, as it is known, snatched up a 46.5% stake in BTA Bank, a rival that had gone bust during the global financial crisis and was bailed out by sovereign investment fund Samruk-Kazyna. Another 46.5% stake was bought by local Kazakh tycoon Kenes Rakishev. KKB has its work cut out for it, because BTA still has a nonperforming loan ratio of 87% of gross loans. But KKB has proven adept at improving its own NPL ratio in the past.

Marc Holtzman, chairman

Kyrgyzstan | Demir Kyrgyz International Bank

The first bank in the Kyrgyz Republic launched with foreign capital, Demir passed a milestone in December when foundation investor EBRD reduced its shareholding by half to 7.5%, in recognition of the bank’s stand-alone strength. Both the International Finance Corporation and the EBRD seeded Demir’s capital 17 years ago at its inception, as a means to improve access to finance by companies and consumers in a country sorely in need of a modern banking system. Demir is now one of the top three banks in Kyrgyzstan in corporate and small- to medium-enterprise lending.

Sevki Sarilar, chairman, general manager

Macau | ICBC Macau

At the end of March 2015, parent company Industrial Commercial Bank of China injected $360 million in capital into ICBC Macau. It did so to build on the bank’s growing market position and to fend off its main competitor, Bank of China Macau, which holds the top market spot in the gambling haven. ICBC Macau’s credit quality, with only 0.5% of its loan portfolio classified as nonperforming, gives it room to tap into the high and constant flow of overseas customers from China and to introduce innovative products linking back to the mainland.


Malaysia | Public Bank (Malaysia)

Public Bank last year outstripped the national loan growth average of about 9% by increasing the credits on its books by 10.8%. This demonstrates that the market for consumer loans in Malaysia is going strong and that Public Bank is growing faster than its competitors. It has done this while retaining its position as one of the nation’s safest banks, with the lowest impaired-loan ratio in the industry, at 0.7% (the industry average is 1.7%). Public Bank is growing in stature as a regionwide player. At the end of March it became the sole owner of a bank in Vietnam, after gaining government approval to buy out its local joint venture partner.

Tan Sri Tay, managing director and CEO

Mongolia | Golomt Bank

A major lender in Mongolia, Golomt Bank fell on hard times after allegations of hidden defaults in 2013. But a new chief executive has given the bank a new face and stronger system of risk controls. It still remains the most innovative consumer and business bank in Mongolia.

L. Oyun-Erdene, CEO

Myanmar | Co-operative Bank

Formed by a government merging of three co-operative banks in 2004, CB, as it is called, has grown to 127 branches. CB has a strong presence in booming Yangon, but it has also distinguished itself with such services as the modestly dubbed “Agent Banking,” which sets up network agents in the countryside to allow farmers to access mobile-phone banking services without having to travel to distant branches. It has also introduced a full suite of cash management services for Myanmar’s young businesses. CB signed a cooperative agreement with the Bank of Tokyo Mitsubishi in 2013, a long-standing partnership that has helped improve CBs offerings.

U Khin Maung Aye, chairman

Nepal | Standard Chartered Nepal

Standard Chartered Nepal finished another good year of steady performance, with an eye, as always, on shoring up its balance sheet and expansion without accelerating risk. After-tax profits for its fiscal 2013—2014 grew 10%, to 1.3 billion rupees ($13 million). The bank reported record income and operating profit, despite what it described as an environment of “margin compression.” For the 2013—2014 fiscal period, deposits grew by 17% to 46.3 billion rupees, compared with the previous period.

Joseph Silvanus, CEO

New Zealand | Westpac New Zealand

Westpac New Zealand was on a roll in 2014, with a 13% rise in annual cash earnings to $864 million on better lending performance and improving bad debts. The year-on-year decline in bad debts was 23%. The rise in income was because of strong growth in domestic financial services and mortgage lending, with total lending up 5% to $3 billion. Mortgages accounted for two-thirds of that amount. In New Zealand, Westpac has installed eye recognition technology in branches, and it is offering enhanced digital and mobile functionality to customers. 

David McLean, CEO

Pakistan | Standard Chartered Pakistan

Pakistan has the reputation of being a difficult market to succeed in. But Standard Chartered Pakistan is going against the grain. It reported profit growth of 17% for its fiscal 2014. The growth looks sustainable, as the bank has placed the strongest emphasis on lending controls among its peers and maintains a 90% provision level against bad loans. Improved administrative controls have delivered a lower cost of deposits than competitors, allowing more flexibility for greater expansion.

Christos Papadopoulos, chairman

Philippines | BDO

The Philippines has enjoyed a rare period of financial stability under president Benigno Aquino III, a sweet spot that has improved domestic consumption. In March 2015, BDO received approval from the Philippines Central Bank to acquire the biggest rural bank in the province of Mindanao, adding another step in BDO’s march to dominating market share in a crowded arena. As the market grows, BDO is best positioned to add new customers. At the end of March, it had 875 branches and 2,542 ATMs nationwide.

Teresita Sy, chairperson

Singapore | DBS Bank

Southeast Asia’s biggest bank, DBS is showing its peers what it means to be big, profitable and enduring. Under CEO Piyush Gupta, DBS has been taking market share in fee-based businesses such as wealth management and investment banking advisory.

When Gupta started as chief executive in 2009, he deployed the bank’s strong balance sheet to build one of Asia’s most impressive trade finance businesses. Soon DBS was biting into bigger banks’ share of financing associated with trade flows between China and Southeast Asia. Now it is taking M&A work away from competitors. It made a decisive step into wealth management by buying Société Générale’s Asian private bank. DBS has tracked the rise of its successful clients into the equity capital markets. In 2014 it advised the $800 million May IPO of the Thai Hotel Investment Freehold & Leasehold Property Fund. “We follow our clients in their growth journey,” in the words of Eng-Kwok Seat Moey, DBS head of capital markets.

Piyush Gupta, CEO

South Korea | Shinhan Bank

Shinhan has boosted its position as an international bank, boasting $120 million in earnings from overseas in 2014. It had 70 branches in 16 countries at year-end 2014, with 8.5% of total profits garnered from overseas. It says it will push past 10% contribution from overseas in 2015. Better overseas loan quality, with the nonperforming loan ratio dropping to 0.6% from over 2% four years ago, is helping.

Yong-Byoung Cho, CEO

Sri Lanka | NDB Bank

Still awaiting a government nod to proceed with a merger with longtime rival DFCC, NDB said in late March that it is going ahead with an expansion plan into Southeast Asia. Prospects look good for the merger, which was instigated by regulators in the previous regime to build a bigger, better-capitalized bank out of the two state-owned institutions. The upsized NDB would have the heft to offer investment banking services.

Rajendra Theagaraja, CAO

Taiwan | Taipei Fubon Commercial Bank

You can’t fault a bank that has topped profitability among its peers for six years running. Taipei Fubon posted NT18 billion ($575 million) in net profits for 2014, a 7% increase over the previous year. Taipei Fubon grew its loan portfolio in 2014 substantially to NT1.3 trillion, up 18%. However, the bank’s emphasis on credit quality has resulted in a ratio of nonperforming loans to gross loans of 0.17% and an NPL coverage ratio of 788.58%. It excels in understanding its customers—a necessity for success in Taiwan’s highly competitive banking market. The bank puts it this way: “By bringing together institutional and personal finance sales teams, marketing resources and customer information, the bank was able to perceive customers’ needs and more precisely define target groups, providing the right products and services that achieved higher penetration rates.” One result: Taipei Fubon’s well-designed new online banking interface has won accolades from customers—and even the admiration of the competition.

Daniel Tsai, chairman

Thailand | Siam Commercial Bank

Siam Commercial Bank is Thailand’s largest commercial bank by market value and is 23.7% owned by the Crown Property Bureau, the investment arm of the Thai monarchy. That gives it an anchor in a highly competitive banking market that was also hit by continued unrest up until mid-2014. Building on the current period of relative stability, Siam Commercial is projecting loan growth in 2015 of 5% to 7%, up from 2% last year. It aims to grow by offering affordable banking services to small and medium-size clients.

Arthid Nanthawithaya, CEO

Uzbekistan | Asia Alliance Bank

Asia Alliance’s determination to become the nation’s go-to bank for consumers and companies has led it to robust expansion in virtually all categories of banking, including lending, credit card issuance, cash management, foreign exchange and subcustody. Its rapid expansion led to some concerns by Moody’s over credit quality, but the rating agency also expressed confidence in Asia Alliance by noting its liquidity position, exceeding 50% of total assets at year-end 2014.

Abdukahorov Ikrom Abduhalikovich, chairman

Vietnam | Techcombank

Vietnam, like almost all countries in Southeast Asia, has a growing population of middle-class consumers crazy for mobile online services. Techcombank knows how to reach these customers. For example, last November it launched a mobile banking service that allowed money transfers through social networks such as Facebook and Google+, via technology purchased from FastCash Singapore. The bank is also original in the way it packages products for industry sectors. It even has an exclusive offering for confectionary distributors.

Ho Hùng Anh, chairmanr


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