While international banks cut back their operations in Asia, the hope is that the large local banks can take up the slack. In the past week the three major Singaporean banks – DSS, UOB and OCBC – have all reported their Q1 results. What does this tell you about your employment prospects?
1. The big banks are only getting bigger
In the wake of the acquisition of Hong Kong-based Wing Hang bank last year, the expectation was that heads would start to roll at OCBC, but it’s actually had the largest increase in headcount of all three banks. It now has 29,644 staff – up from 25,304 12 months ago – and staff costs increased by 25%.
But headcount is up across all three banks – UOB now has 25,321 employees, up from 24,775 a year ago, while DBS has increased staff numbers by 9.3% to 21,460 people.
2. Wealth management is the place to be
It’s no surprise, considering the vast increase in wealth across Asia, that wealth management and private banking is the growth story. At OCBC quarterly income reached a record quarterly high of S$583m, while income at DBS went up by a massive 43%, to S$167m and UOB increased revenues by a modest 7.4% to S$110m.
3. Investment banking is not…
Global investment banks have been cutting headcount as investment banking fees have dwindled, but local banks are by no means a safe haven. OCBC said that investment banking profit slipped by 6%, although this was down to an increase in expenses and lower income from its trading functions. Meanwhile, DBS’s investment banking income plunged by 30% on this time last year.
UOB doesn’t break out investment banking specifically, but its wholesale banking revenues increased by 4.8%. It also benefited from the rebound in FICC trading activity during the first quarter, with its ‘global markets and investment management’ division – which incorporates securities trading – posting a 70% uptick in revenues.
4. China revenues are picking up
OCBC’s acquisition of Wing Hang last year will have provided a nice boost to its China revenues, but a 94% increase in revenues in Greater China suggests that it’s doing well elsewhere. Specifically, OCBC said that it was expanding in trade finance in China in the wake of the Wing Hang acquisition. At UOB, China was the only key market outside of Singapore to post an increase in profit before tax, with a year-on-year rise of almost 3%.
But before you assume that China is the place to be, bear in mind that DBS is struggling a little on the Mainland. Profits for Hong Kong and Greater China slipped year on year from S$453m to S$358m.