(28th October, 2003 – Asia) Multinational Corporations (MNCs) operating in Asia are demanding that banks deliver world-class products and services that allow them to improve their working capital and supply chain management efficiencies, according to banking research firm East & Partners.East’s latest survey of Asia’s Transaction Banking and e-Banking Markets
shows MNCs have an increasing appetite for Liquidity Management, Short Term
Debt, Internet Banking and Trade Technology products and services.
East & Partners principal analyst Paul Dowling said Trade Finance in particular
was proving to be a big growth area among MNCs in the region.
“Banks in Asia are having to respond to a fresh wave of more sophisticated
customer demands from the multinationals,” Mr Dowling said.
Overall the survey reveals Transaction Bankers to MNCs in Asia are delivering
“moderate to acceptable” levels of satisfaction across the 27 factors monitored
with the best three service factors being:
-
Quality of Support & Legal Documentation
-
Credit Rating of Bank
-
Settlement Performance
The three worst performing service factors across the market are:
-
Effectiveness of Problem Resolution
-
Usefulness of Bank’s Website
- Credit Approval Turnaround Times and Being Proactive in Dealings with Customer
The survey shows that ABN Amro, Bank of America and JPMorgan achieve the highest
customer satisfaction ratings in Transaction Banking services to MNCs.
UBS, JPMorgan and Citigroup combined own more than 40 percent of the MNC market
in Asia while local banks have less than two percent of the MNC market.
Local banks, however, have been performing strongly among Secondary Transaction
Bankers with DBS and Bank of China capturing 9.5 percent and almost seven
percent market share respectively.
Mr Dowling said local banks provided good service when dealing in the local
currency but continued to find the going tough in terms of the service levels
required to satisfy the top echelon of MNC customers in the region.
“Local banks typically lack the service levels, infrastructure and technology of
the majority of major banks,” he said.
“But the rapid change taking place in Asia has been good for international banks
that have been strong enough to fund expansion and make the necessary technology
investments.
“This has been reflected in our research by the dominance of players such as
HSBC and Standard Chartered, and the ongoing success of US banks such as
Citigroup, Bank of America, ABN Amro, Deutsche and JPMorgan,” Mr Dowling said.
The top three initiatives that respondents identified as “making a difference”
in improving their quality-of-service experience in Transaction Banking are:
-
Closer Understanding of Customer’s Business
-
Improved Account Aggregation Options
- Response Time on Queries
The fourth most important initiative was Enhanced Electronic Systems Delivery,
which was reinforced by the SARS epidemic.
“In affected countries, the virus was responsible for big increases in the use
of electronic banking transaction volumes as a result of institutions and
companies restricting face to face interaction,” Mr Dowling said.
“However, banks must avoid focusing too heavily on indirect, web-based models of
customer engagement as customers also continue to demand better relationship
management from their banks.”