Hong Leong Bank - MBAN Summit 2016

Hong Leong Bank Berhad’s ("HLB" or "the Bank") Group Managing Director and Chief Executive Officer, Mr. Domenic Fuda today addressed participants of the MBAN Summit 2016. The summit, in conjunction with WIEF IdeaLab 2016, brought together a mix of existing and prospective angel investors as well as the entrepreneurship ecosystem of influencers under one roof to raise greater awareness on angel investing and its role in the development of the Malaysian and regional startup ecosystem. In line with the theme of the summit, his opening remarks touched on the importance of collaboration in order to strengthen the ecosystem and the shift of conventional business to what it is today, a 'Sharing Economy'.

Mr. Fuda said, "I am glad to be here amongst ASEAN’s best startups, investors and corporates in the ecosystem! Firstly, congratulations to the WIEF and MBAN teams for organising the IdeaLab and MBAN Summit 2016 and for signing the first ASEAN Angels Alliance ("AAA") Memorandum of Understanding yesterday".

"I think it is great that these events have started off with a commitment to collaborate, brought together and driven by a common purpose and objective to not only promote intra-ASEAN investment in startup or tech-based or high growth businesses and promote cross-border syndication and co-investment but to share knowledge and best practices within the community. Working together will certainly strengthen the community and ecosystem. Coincidentally, collaboration, is also the theme of my speech this morning".

"These are challenging but also very interesting times. As you are all familiar, the dynamics of conventions are shifting, some more dramatically than others but the knock-on effects of these shifts are all far-reaching. To contextualise this statement, PwC had in a recent study identified five (5) global megatrends that are impacting us, specifically, demographic and social change, shift in global economic power, rapid urbanisation, climate change and resource scarcity and technological breakthroughs".

"What is of greater interest however, is that the same study goes on to identify the collision outcomes of these megatrends: a ‘Sharing Economy’ – a model that impacts everything from accommodation, transportation to financial services". And one that is a collaborative economic model where the lines between the service provider and consumer, have blurred and in some cases, been totally eliminated".

"The novel innovative commercial and non-commercial services and solutions, even entire ecosystems that have developed as a result of either necessity or a combination of necessity and opportunities stemming from gaps in existing environments enabled by technology. It is so easy for consumers today, to become service providers. Enabled by the platforms that function as networking channels, we have today result, business models and businesses that exist today, like Airbnb, Grab, RecomN, Carsome - to name a few".

"Without doubt the world is evolving – fast. It is in such times where the agile businesses that are in-sync with its consumers will thrive and those who are slow to determine a strategy to evolve their business will eventually face their Kodak-moment. The transparency of this sharing economy is forcing businesses to step-up their game or be left out. And this is why we are here today – the startups, angels, investors and the incumbent financier - to hear from the experts the trends and insights that will drive future decision making processes as well as the growth and development of startups and fund sourcing opportunities".

"For Hong Leong Bank, we are cognisant of the disruptions, particularly in the financial sector. PwC’s most recent analysis suggests that consumer banking, fund transfer and payments are the sectors most likely to be disrupted over the next five (5) years. In many of these areas, disruptors have been targeting the end customer directly, bypassing traditional banks. However, if you look at the trends of financial services around the world, there is a consensus that partnering with start-ups is the way to move forward".

"Partnerships with FinTechs offers opportunities for the incumbent in many areas – from delivering cost reduction opportunities, differentiated offerings, customer retention to prospects for additional revenues. As for the FinTechs, by collaborating with the incumbent, they can strengthen their competitive position and bring solutions or products into the market more quickly. Collaboration is the most effective way for both incumbent, start-ups and FinTech to complement one another".

"It is clear that highly regulated, specialised and customised services will see more of a collaborative approach as opposed to a disruptive one, as these high-touch areas is highly dependent on the relationships and expertise from the incumbent. In the same manner, this is an area where we see ourselves bringing value to the table".

"Hong Leong Bank announced our collaboration with MBAN early last month. Whilst we have long been a bank that is focused on the Small and Medium Enterprises, our efforts around driving digital innovation and customer experience improvements have largely been internal".

"We have also grown over the years to become Malaysia’s fourth largest commercial banking institution with a total assets exceeding RM 180 billion, more than 300 branches and a staff force of more than 8,500 people across five countries, a stage where, words like agility and transformation may become a little incongruent with business as usual".

"So, where are we today in terms of the development and support for the startup and angel investing ecosystem? Realistically, it is still at a nascent stage and banks are still trying to determine the best way to support the companies and entrepreneurs for the mid-to-long term. Our shared challenge remains, the longer-term sustainability and scalability of the respective businesses".

"But it is timely for each of us to work together to arrive at the best solutions and that is why I have my teams here – to engage with a community that is not commonly on our radar and to also experience the different manner in businesses are approached, managed and valued. We will also be rolling out our own mentorship programme in collaboration with MBAN end this year", Mr. Fuda concluded.

Hong Leong Bank Berhad is one of the leading financial services organisations in Malaysia. With a heritage of more than 100 years, it provides comprehensive financial services covering consumer banking, business banking and trade finance, treasury, branch and transaction banking, wealth management, private banking and Islamic financial services. Its merger with EON Bank Group in 2011 has further embedded its position as a core banking franchise with an expanded distribution network of more than 300 branches across the country.

With a proven track record in value creation and a highly recognised brand, Hong Leong Bank has also been extending its footprint in the region, with branches in Singapore and Hong Kong and wholly owned subsidiaries in Vietnam and Cambodia. In China, the Bank has a 20% shareholding in Bank of Chengdu Co., Ltd., Sichuan and a consumer finance joint venture.

Hong Leong Bank is a subsidiary of Hong Leong Financial Group Berhad, the financial services arm of the Hong Leong Group. Apart from banking, Hong Leong Financial Group is involved in the provision of insurance and takaful, as well as investment banking, unit trust, fund management and stock broking services.