Why did ANZ pull back from private banking in Asia? Bank boss Shayne Elliott explained on a recent visit to Singapore.
ANZ chief Shayne Elliot expanded on the reason the bank pulled out of Asian consumer banking, selling to DBS, in a question-and-answer session with the Australian business community in Singapore.
The Melbourne-based bank previously pursued a strategy aimed at putting the bank at the forefront of Asia's growth. Under former CEO Mike Smith, the bank in 2009 splashed out $550 million for Royal Bank of Scotland’s operations in six Asian countries.
Minimalist Bank
When he reviewed the business units seven years later, Elliott said they accounted for a paltry one percent of ANZ's profits – and they were in danger of suffocating under growing regulation. «It made no fiscal sense to keep them on,» Elliott said.
Instead the bank is now focusing on trade and capital flows between Asean, North Asia and Australia where his bank has heft. «We are focusing on a few things and doing them really well,» Elliott remarked.
The simplification of the Asian wealth management business was a key target for Elliott, who wants his bank to be a lean, mean and modern machine. The CEO is embracing fintech solutions and recruiting technology and consumer experts into key positions in a bid to modernize ANZ.
Opposing Voice
Together with his fellow Aussie bank CEOs, Elliott has been under intense public scrutiny in recent months. A year-long Australian government-led inquiry into banking practices is exposing deep fissures in the country’s banking sector.
Elliott was an outspoken critic of the inquiry being set up, but now harbors hope it will lead to industry changes. «I get it and I understand why it was set up, but we have to make sure it is a good thing» Elliott said. «If banking gets over-regulated banking people on the edge will become too hard and banks will only work with wealthy customers and companies», he cautioned.
