DBS CEO says tough for digital banks to gain market share in Singapore

DBS CEO Piyush Gupta speaks throughout a Reuters Newsmaker occasion in Singapore March 2, 2017. REUTERS/Edgar Su

HONG KONG, Dec 3 (Reuters) – Singapore’s digital banks will discover it laborious to carve out house within the city-state’s saturated market, stated Piyush Gupta, the CEO of DBS Group (DBSM.SI), Southeast Asia’s greatest financial institution.

On-line-only banks are attributable to begin operations in Singapore subsequent 12 months within the monetary hub’s greatest banking shake-up in 20 years.

“In Singapore, it isn’t that straightforward for digital banks to carve out house,” Gupta instructed the Reuters Subsequent convention on Friday, pointing to Singapore’s 98% banking penetration and incumbents’ robust digital product suite.

“Even in markets like Brazil and China you may see that the relative market share, dimension and development of the incumbent banking system hasn’t shifted very a lot,” he stated.

Final December, Singapore-based web platform firm Sea Ltd (SE.N) and Southeast Asian ride-hailing agency Seize’s enterprise with Singtel (STEL.SI)gained full digital financial institution licences, and are attributable to begin operations on a restricted foundation from 2022.

However Gupta stated pointers by the Singapore regulator to make sure that newer entrants have a worthwhile enterprise over the following few years would stop them from shopping for market share by operating enormous losses over time.

“For sure, you’ll should compete. Folks will are available with aggressive pricing merchandise and so forth. However on the entire, I feel we’re comparatively properly positioned and we should always be capable of maintain our personal,” he stated.

Over the previous decade, Gupta has steered DBS into investing billions of {dollars} to improve its expertise infrastructure because it embraced cloud computing and digitised its companies.

Gupta stated the financial institution’s enterprise momentum was sturdy regardless of the Omicron coronavirus variant spreading globally and battering markets as buyers fear in regards to the influence on financial development.

“Once I have a look at our mortgage ebook and personal mortgage pipeline, these are fairly sturdy, and that is true throughout the area, together with in China the place macro numbers are slowing down. However for a participant like us, we’re seeing fairly good momentum in our enterprise there,” he stated.

“As we’re our pipelines and our enterprise projection for 2022, I feel we’ll just about proceed to see pretty related momentum as we go into the 12 months.”

Final month, DBS beat market estimates with a 31% rise in July-September internet revenue, aided by development in payment earnings and enhancing asset high quality. learn extra

Reporting by Anshuman Daga; Extra reporting by Aradhana Aravindan and Alun John; Modifying by Ana Nicolaci da Costa

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