Asian Banks Are Nibbling the Lunches of Global Banks (CCTV)

A segment on China’s CCTV has noted how banks in Asia’s emerging markets are reporting slower growth with the familiar ritual in boom-bust financial cycles of shuffling executives, shedding employees and “belt-tightening.” The difference this time around is that for many banking employees in Asia and elsewhere, there will be no “revolving door” – just the one marked “Exit.” For example: Barclays PLC (NYSE: BCS) says it’ll cut 19,000 jobs over three years while HSBC Holdings plc (NYSE: HSBC) kicked off a big restructuring program in May 2011, selling over 50 businesses and cutting over 25,000 employees.

Jim Antos, the Head of Asia Ex-Japan Banking Sector Research, Mizuho Securities Asia, commented that:

“Sometimes it does not pay to be a global bank. Sometimes it pays to be a very strong local bank. Take, in Singapore for instance, a DBS [DBS Group Holdings Ltd (OTCMKTS: DBSDY)] or in Hong Kong a BOCHK [Bank of China (Hong Kong) Limited (OTCMKTS: BHKLY / BNKHF)], these are very strong local banks. And I don’t want to say that they are eating the lunch of the global banks, but they are certainly taking a nibble out of that lunch…. A bank like DBS, for instance or a bank in like Hong Kong, they are taping into the cross border business. Asian banks have advantages.”

The segment ended by noting that Hong Kong listed Chinese banks are coping with China’s slowing economy while banks in emerging markets have a slightly better footing than their peers in developed markets.

To read the whole article and watch the video segment, Banking growth slows in emerging Asian markets, go to the website of CCTV.

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