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Asian Banks Well Positioned to Weather Global Financial Crisis
We are living in the “century of Asia”, and the region’s banks are well positioned to withstand the global financial crisis, a panel of banking CEOs told the Asian Investment Conference.
ANZ Bank CEO Mike Smith said Asian economies are in for a rough ride through 2009 and possibly even 2010. But he noted that from a banking perspective the outlook in the region was brighter.
“Being a bank CEO is not the best job in the world right now, (but) if you are a bank CEO the only place to be is in this region,” Mr. Smith said.
He said that while Asia Pacific had some areas of “stress”, the banks in this region have the benefit of being self-funded. This means they are not reliant on the credit markets the same way as some other foreign banks, he said.
“I’m also fairly optimistic over the (medium term), and in fact very optimistic over the long term,” he said.
“This is the century of Asia. And I think the region will continue to be quite resilient once we get through this next couple of years. But it is going to be choppy.”
Mr. Smith, who this week announced a three-point plan to accelerate ANZ’s progress in becoming a leading foreign bank in China, said the bank was working to becoming a “super-regional bank.”
However, he noted that expectations on returns would need to be more realistic.
“Banks should be boring,” he said. “Banks are boring. Banks became exciting and look what happened.”
Mr. Smith conceded that some financial organizations have had to rethink their strategies as a result of the crisis and in some cases pull back their domestic operations.
“But our (Asian) banks are in a nice position,” he said. “We are the silver (lining) in this crisis.”
Standard Chartered Bank CEO (Asia), Jaspal Bindra, said 2009 was clearly showing every sign that it was going to be a challenging year for Asian economies and that they are likely to remain slow.
However he pointed to three high-growth markets, of China, India and Vietnam and noted: “We will see Asia being instrumental in making the recovery happen.”
“Within Standard Chartered we feel pretty bullish abut Asia in a relative sense,” he said. “It is probably the best place to be at this place in time.”
He also noted that Standard Chartered and other banks were working with governments and regulators to ensure stability.
“In most markets now given the current crisis foreign banks are playing a strong role working in partnership with policy-makers in formulating a response to the crisis,” he said.
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Day 3: Photo Album
