Asia-Pacific Financial Services Insights – May 2019

Asia-Pacific Financial Services Insights – May 2019

Welcome to the latest edition of Protiviti’s Asia-Pacific Financial Services Insights. In this monthly newsletter, we provide a summary of important developments across the Asia-Pacific financial services sector, including those related to the ever-changing regulatory landscape.

Cross-agency fintech collaboration, policy measures from regulatory authorities, and central bank monetary policy strategies are themes highlighted throughout our latest newsletter. Examples include collaboration on fintech innovation between the HKMA and Bank of Thailand, Japan’s Financial Services Agency scrutinizing cryptocurrency exchanges, and China’s central bank’s outlook on market conditions amid U.S. tariffs on Chinese imports.


APAC 

Citi to roll out consumer e-payments business in 20 markets by Q1 2020

Citi plans to launch a new digital consumer payments business in 20 markets across all regions, including Asia. Citi's new service will offer merchants a range of consumer payment options to collect money, including from credit cards and e-wallets, the company had said and will expand its product portfolios within its mainstay B2B payment offerings.

(Business Times, 16/05/2019) 

Banks need to be more agile to remain competitive

Technology has already changed the business models of today’s banks, but operating models have been slow to catch up. Modernising the core platform and establishing an IT architecture driven by modular applications and harmonised processes are the keys for traditional banks to remain successful in an increasingly competitive market.

(Regulation Asia, 10/05/2019)

Hong Kong 

Hong Kong Monetary Authority & Bank of Thailand sign MoU on fintech collaboration

The HKMA and the Bank of Thailand have signed a Memorandum of Understanding to collaborate on fintech innovation between the two regulatory authorities.

(Crowdfund Insider, 14/05/2019) 

Hong Kong grants four more virtual banking licenses

The HKMA announced that it had granted banking licenses to another four companies, bringing the total number of virtual bank license owners to eight. The four new license owners include Ant SME Services (Hong Kong) Limited, Infinium Ltd, Insight Fintech HK Ltd and Ping An OneConnect Company Ltd.

(Asia Times, 09/05/2019) 

HKMA unveils measures on sustainable banking and green finance

The HKMA announced three sets of measures to support and promote Hong Kong’s green finance development. The HKMA will collaborate with relevant international bodies to provide technical support to banks in Hong Kong to better understand the green principles and methodology in undertaking the baseline assessment.

(The Asset ESG, 08/05/2019) 

Singapore 

MAS, ABS Form Culture and Conduct Steering Group

The MAS and Association of Banks in Singapore have formed a new steering group to promote better culture and conduct among Singapore banks. The steering group will identify best practices, monitor trends and emerging issues, and collaborate on initiatives to promote strong culture and conduct.

(Regulation Asia, 23/05/2019)

MAS and Asia Pacific Future Financial Research Institute to promote fintech innovation

The MAS and the Asia Pacific Future Financial Research Institute have signed a FinTech Co-operation Agreement to promote academic exchanges, information sharing and research co-operation on fintech. It aims to encourage greater collaboration between business communities, academia and think tanks from Singapore and China.

(Mondovisione, 13/05/2019)

MAS considering virtual banking licences for fintech firms

The MAS said it is studying whether to admit digital-only banks that have emerged out of fintech firms as licensed entities. The agency has been examining how digital banks emerging from non-banking origins can add value and operate in a risk-managed environment.

(The Straits Time, 07/05/2019)

China 

China's central bank says to keep yuan stable, in balanced range

The People’s Bank of China (PBOC) will maintain basic stability of the yuan exchange rate within a reasonable and balanced range. The PBOC will also make the necessary counter-cyclical adjustments and strengthen macro prudential management according to changes in the situation, as well as taking actions to combat illegal and irregular behaviour and safeguard good order on the foreign exchange market.

(Reuters, 19/05/2019) 

China central bank says no need for easing after tariff hike

The PBOC indicated that it saw no reason to undertake a major easing of monetary policy as a result of the increase in U.S. tariffs on Chinese imports. The central bank gave an optimistic interpretation of April lending and credit data and expressed confidence that its deep policy toolkit could address all market contingencies.

(SCMP, 10/05/2019)

J.P. Morgan close to being first foreigner to get majority in China fund venture

According to latest rules, foreign asset managers can own up to 51% of their Chinese mutual fund joint ventures but no company has managed to do so. J.P. Morgan Asset Management currently owns 49% of China International Fund Management, while Shanghai International Trust owns 51%. Shanghai International Trust revealed it would auction its stake in the fund, hence J.P. Morgan could become the first foreign company to own a majority stake in its Chinese mutual fund business.

(International Investment, 08/05/2019)

Japan 

Japan’s central bank chief warns of global economic slowdown

Bank of Japan governor Haruhiko Kuroda said that the global economic outlook remains highly uncertain and there are downside risks due to trade conflict, China's decelerating economy and the stalled Brexit negotiations between the United Kingdom and the European Union.

(Business Times, 27/05/2019) 

Japan scrutinizing crypto exchanges ahead of G20 Summit

Japan’s Financial Services Agency said that it would be scrutinizing cryptocurrency exchanges in the country to ensure anti-money laundering processes are in place. An unnamed FCA Official cited that inspections are being carried out ahead of the G20 summit next month.

(Coindesk, 23/05/2019)

Japanese banks to boost fight against money laundering

The banking industry will strengthen efforts to prevent money laundering in preparation for the planned review of industry efforts by an international organization in the autumn. The review will be carried out by the Financial Action Task Force.

(The Japan Times, 05/05/2019) 

Australia 

Australia's big banks search for new customers with cut price fixed loans

Australia’s biggest lenders are competing to win back the market’s trust after suffering significant reputational damage over the past year in the fallout of a landmark misconduct inquiry. With profit growth weakening along with property prices, the lower fixed rates are a cheaper way to lure new borrowers than more costly cuts to variable rates.

(Reuters, 10/05/2019) 

Australia's shrinking monetary policy arsenal tests RBA's orthodoxy

The Reserve Bank of Australia is certain to cut its benchmark interest rate amid a rapid decline in home prices, weak consumer inflation and insipid wage growth. Compared with previous cycles, the central bank has less policy ammunition to stabilize the economy with only 150 basis points of easing left before it hits 0 percent.

(Reuters, 03/05/2019)

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Jeffery Naquin
Jeffery Naquin
Director
+ 852 2238 0499
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Raymond Tsui, Protiviti Hong Kong
Raymond Tsui
Director
+852 2238 0499
Linked