INTERVIEW
ICBC (Asia) CEO reveals plans to capitalise on China’s Belt and Road Initiative Jiang Yisheng wants to fully tap Hong Kong’s potential as a “super connector.”
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nalysts predict that Hong Kong banks’ asset quality will continue to deteriorate due to a number of factors such as rising delinquencies, weak growth in global demand, and higher borrowing costs owing to further monetary tightening in the US. Jiang Yisheng, CEO of ICBC (Asia), says that amidst the economic uncertainties, the bank has implemented some measures aimed at strengthening its capability to control both risks and asset quality. “Presently, ICBC (Asia) maintains its non-performing loan ratio at a reasonable level and will endeavour to improve its credit risk management system unceasingly. For instance, the bank has enhanced the due diligence for its lending, the procedure for reviewing and approving loan applications as well as post-loan management,” he adds. Jiang was appointed as CEO in December 2015. After almost a year into the position, he reveals his views of Hong Kong’s current banking sector and his future plans for ICBC (Asia) in an exclusive interview with Asian Banking and Finance. ABF: What are the biggest challenges facing Hong Kong banks today? Nowadays, the global economy is extremely complicated and the financial markets fluctuate more wildly. Some companies have operational difficulties which are structural in nature. In such circumstances, I think the banks in Hong Kong are facing a number of major challenges, namely: how to enhance the capability to control the asset quality and withstand risks; how to raise the standards of business management and how to strengthen the overall capability to serve customers. ABF: You were appointed as CEO in December 2015. Ten months into the position, what changes have you implemented and what are your future plans? Since I assumed the office of the CEO of ICBC (Asia) in December 2015, I’ve been faced with a market where Hong Kong’s banking sector has shifted down a gear from rapid growth in the past. After having grown its business by leaps and bounds in the past several years, ICBC (Asia) has now entered a period for consolidating its businesses. It now has to meet new requirements to cope with a new situation which is marked by adjustments in organic growth and optimisation of organisational structure. To prepare for that, we have decided to actively develop cross-regions businesses, speed up the transformation of the bank’s business model and the implementation of its strategy for comprehensive development. Such endeavours have already yielded good results. In the first half of 2016, ICBC (Asia) achieved double-digit percentage growth in both the scale of business and profit.
ABF: What are your key business philosophies? I believe that a commercial bank should always adhere to the principle that “the financial sector serves the needs of real economy.” That is, a commercial bank should grow together with a nation and enterprises through cooperation, by adapting itself to the changes in economic environment, by capturing opportunities and by fitting in with the national strategies and policies. Under the present circumstances, ICBC (Asia) will fit in firmly with China’s national strategies such as the Belt and Road Initiative and the internationalisation of the renminbi. It will also actively capitalise on the increasing connectivity between the financial markets of mainland China and Hong Kong and speed up the consolidation of the resources in Asia Pacific so as to build a framework for a cross-market, comprehensive, and integrated business. This will enable the bank to provide a comprehensive range of financial services (such as financing, services for mergers and acquisitions, and settlement, etc.) for the countries and enterprises in Asia Pacific and those covered by the Belt and Road Initiative. This is one of the ways for ICBC (Asia) to contribute to the economy and prosperity of both mainland China and Hong Kong. ABF: What three goals are you focussed on in the next 12 months? Firstly, we aim to facilitate development by thoroughly enhancing the quality and efficiency of the operation of the core business. ICBC (Asia) will reinforce its foothold in Hong Kong, capitalise on the growth momentum of mainland China and extend its footprint to Asia Pacific. It will also enhance its capability to coordinate the developments of the businesses within the ICBC Group and to operate cross-region businesses. We aim to enhance the quality of development whilst maintaining steady growth in the scale of assets as we are shifting the focus from “building a large company” to “building a strong enterprise.” Secondly, we will adjust the structure by forming a framework for sustainable business development which is driven by diverse operations. ICBC (Asia) will further adjust and optimise the operation structure. Specifically, the bank will speed up its transformation from a sizeable asset operation bank into a large asset management bank as well as its transformation from a conventional commercial bank into a comprehensive financial group. Thirdly, we will step up risk control to reinforce the foundation for sustainable and steady development. ICBC (Asia) will further improve the overall risk management system. It will enhance its capability to prejudge and manage credit risks, market risks and operational risks so as to minimise these risks, and ensure that the risks to the overall operation are manageable. ASIAN BANKING AND FINANCE | DECEMBER 2016 45