Over-regulation of financial market will cause problems in future: DBS
Posted: 15 March 2013 2259 hrs
SINGAPORE: The head of Singapore's biggest bank said over-regulation of the financial market will cause problems in coming years. CEO of DBS, Piyush Gupta, said Asian banks do not have the same problems as their global peers in meeting capital and liquidity requirements.
Speaking at the sidelines of a banking industry forum on Friday, Mr Gupta said the Asian financial crisis in the late 90s taught them to control bad loans and keep adequate cash reserves.
However, he added that Asian economies cannot grow unless companies have access to funds.
Mr Gupta said: "Our Basel 3 fully phased-in core tier one requirements are about 11.8 per cent, so it is not an issue. But if you fast-forward five years, for the region as a whole, our own estimates are that the region is short of capital somewhere between a quarter of a trillion to a trillion dollars.
"That will prove a serious challenge to Asia as it wants to step up its growth, step up its investment in infrastructure, and scale up the pace of overall economic activity."
Mr Gupta also commented on the impact if the recent initiatives announced by the Singapore government as part of Budget 2013. He said Singapore's focus on taxing the super-rich and talk of limiting foreign workers will not hurt DBS's wealth management business.
"Singapore is a very attractive place from a tax standpoint, so if your marginal tax rate moves up a percentage point or two it does not materially change the tax situation," he added.
"Singapore has a lot of other things going for it -- infrastructure, rule of law, language -- so it's a very attractive destination for capital flows and wealth flows. We frankly see this continuing to be a big part of our growth agenda."
DBS was voted Asia's safest bank for a fifth year by Global Finance. Mr Gupta said being safe does not mean ignoring investment opportunities, but it cannot be sacrificed for quick profits.
He said: "For us being safe and sound and secure is a priority. Frankly, that's a large part of what Singapore stands for and what DBS stands for, so we're fairly proud of that.
"Having said that, we believe that we can be safe and still do a lot of things that make us innovative, that make us relevant to our customer base. And frankly, our trajectory in terms of growth of our business over the last three or four years demonstrates that you can do both."
DBS is also growing its renminbi trade in Taiwan, Hong Kong and Singapore. Mr Gupta said doing business in the Chinese currency will be a core profit driver in coming years.
"We have a view that the renminbi will open up more, liberalise more. And all over Asia, you will start to see the renminbi as a unit of account and an instrument of trade. Already in Hong Kong, the renminbi business is about a quarter of our business and that's quite profound given that three years ago, it was zero.
"So we see the renminbi beginning to have a meaningful role in all the activities in our region. It's difficult to put a percentage on it but quite clearly the direction is one way."
-CNA/ac
- wong chee tat :)
Saturday, March 16, 2013
S'poreans drinking more coffee
S'poreans drinking more coffee
By Yvonne Chan | Posted: 15 March 2013 2343 hrs
SINGAPORE: Singaporeans are drinking more coffee -- brewing demand has raised coffee bean imports to S$1.4 billion in 2011, up from S$1.1 billion in 2008.
The overall coffee consumption is also set to increase by 2.5 to three per cent per annum, with growth led by indie or small entrepreneur owned cafes at a rate of four per cent per annum.
At Southeast Asia's first and largest gathering of tea and coffee industries, Cafe Asia 2013 and the International Coffee & Tea Industry Expo, 95 exhibitors from 22 countries have come to hawk their wares and tap into Asia's huge coffee drinking potential.
According to the ASEAN Coffee Federation and Singapore Coffee Association, local coffee (for example, those consumed in kopitiams) still forms the main base of coffee drinkers in Singapore, with 10,000 to 12,000 tonnes consumed yearly.
This is followed by instant coffee at 2,000 tonnes per annum, and then retail coffee chains and indie cafes (including specialty coffee) at 1000 to 1500 tonnes yearly.
Costing between S$3 to S$6 a cup, indie cafes typically specialise in roasting their own coffees, with machines that do not come cheap.
Rainer Van Der Beek, vice president of sales and marketing at Probat, said: "The smallest shop roaster, a tabletop machine with a one kilogram batch size, is around 11,000 euros. And it goes further up to around 26,000 euros for a 12kg batch size.
"We see the demand for some industry equipment here in Singapore but I expect the biggest increase in numbers with regards to specialty roasters, small roasters. I wouldn't wonder that we sell within the next year, about 10 to 15 units here in Singapore."
With Asia's rising affluence, coffee experts said the demand for specialty coffee in Singapore is set to rise even further. But local coffee players aren't to be outdone, with many innovating to cater to more sophisticated palates.
Victor Mah, president of the ASEAN Coffee Federation and Singapore Coffee Association, said: "You have people like Toastbox for instance, they actually do train their staff on how to brew coffee and they've made attempts to use better grade coffee and improve hygiene standards. Price-wise, it's a far cheaper brew than going to one of the more specialised cafes.
"A lot of them are looking overseas. You know, Boncafe has been around for 50 years. And they've moved into a lot of other markets -- Malaysia, Middle East, Thailand. The indie shops have also created niche markets overseas."
Some market players feel there is still room to grow in this somewhat saturated market, by gaining sole distributorship of certain coffee beans.
Evangeline Wong, director of JBM Coffee Asia, said: "Singaporeans these days are very cosmopolitan, very well-travelled, they're looking for finer things in life. Customers will keep coming back if we provide the right service and right attitude and of course, a good cup of coffee."
Still, the perennial problem of high rental costs and labour shortages continue to confront coffee purveyors here -- not quite their cup of tea.
-CNA/ac
- wong chee tat :)
By Yvonne Chan | Posted: 15 March 2013 2343 hrs
SINGAPORE: Singaporeans are drinking more coffee -- brewing demand has raised coffee bean imports to S$1.4 billion in 2011, up from S$1.1 billion in 2008.
The overall coffee consumption is also set to increase by 2.5 to three per cent per annum, with growth led by indie or small entrepreneur owned cafes at a rate of four per cent per annum.
At Southeast Asia's first and largest gathering of tea and coffee industries, Cafe Asia 2013 and the International Coffee & Tea Industry Expo, 95 exhibitors from 22 countries have come to hawk their wares and tap into Asia's huge coffee drinking potential.
According to the ASEAN Coffee Federation and Singapore Coffee Association, local coffee (for example, those consumed in kopitiams) still forms the main base of coffee drinkers in Singapore, with 10,000 to 12,000 tonnes consumed yearly.
This is followed by instant coffee at 2,000 tonnes per annum, and then retail coffee chains and indie cafes (including specialty coffee) at 1000 to 1500 tonnes yearly.
Costing between S$3 to S$6 a cup, indie cafes typically specialise in roasting their own coffees, with machines that do not come cheap.
Rainer Van Der Beek, vice president of sales and marketing at Probat, said: "The smallest shop roaster, a tabletop machine with a one kilogram batch size, is around 11,000 euros. And it goes further up to around 26,000 euros for a 12kg batch size.
"We see the demand for some industry equipment here in Singapore but I expect the biggest increase in numbers with regards to specialty roasters, small roasters. I wouldn't wonder that we sell within the next year, about 10 to 15 units here in Singapore."
With Asia's rising affluence, coffee experts said the demand for specialty coffee in Singapore is set to rise even further. But local coffee players aren't to be outdone, with many innovating to cater to more sophisticated palates.
Victor Mah, president of the ASEAN Coffee Federation and Singapore Coffee Association, said: "You have people like Toastbox for instance, they actually do train their staff on how to brew coffee and they've made attempts to use better grade coffee and improve hygiene standards. Price-wise, it's a far cheaper brew than going to one of the more specialised cafes.
"A lot of them are looking overseas. You know, Boncafe has been around for 50 years. And they've moved into a lot of other markets -- Malaysia, Middle East, Thailand. The indie shops have also created niche markets overseas."
Some market players feel there is still room to grow in this somewhat saturated market, by gaining sole distributorship of certain coffee beans.
Evangeline Wong, director of JBM Coffee Asia, said: "Singaporeans these days are very cosmopolitan, very well-travelled, they're looking for finer things in life. Customers will keep coming back if we provide the right service and right attitude and of course, a good cup of coffee."
Still, the perennial problem of high rental costs and labour shortages continue to confront coffee purveyors here -- not quite their cup of tea.
-CNA/ac
- wong chee tat :)
Singapore a test-bed for yuan products
Singapore a test-bed for yuan products
By Linette Lim | Posted: 15 March 2013 2218 hrs
SINGAPORE: Singapore's financial sector can be a test-bed for new yuan-linked products, according to Deputy Prime Minister and Finance Minister Tharman Shanmugaratnam who spoke at a banking industry forum on Friday.
The forum organised by the Financial Markets Association (ACI) was attended by over 700 delegates.
For instance, Mr Tharman said banks in Singapore can explore how to encourage offshore RMB bond issuance in Singapore with longer maturity tenors and different issuer profiles.
As the fourth largest foreign exchange trading centre in the world, Singapore can play an important role in integrating both the offshore yuan and Asian local currency markets.
This could be done through carrying out or booking trades in yuan or by developing yuan investment products.
He said: "While the US dollar will remain an integral global settlement currency, the renminbi (RMB) is likely to be increasingly used for trade denomination and contract pricing. As the (offshore RMB) market grows in multiple jurisdictions, regulators and market participants will have to work together to avoid fragmenting liquidity across markets and to promote efficiency in the offshore renminbi market."
While the yuan becomes increasingly important as a diversification currency for central banks and for trade among companies, the US dollar is seeing a gradual decline as an international reserve currency.
Still, experts said the dollar is likely to strengthen against other major currencies in the short to medium term.
Vice chairman of Blackrock, Philipp Hildebrand said: "Of course, we still have a current account deficit, but depending on what happens on the energy front, you can easily imagine the US moving into a current account surplus for the first time in decades, within a couple of years from now. Again that should be broadly supportive of the dollar."
So far, the US recovery is seen to be the firmest among the developed economies.
This could help reverse a long-term depreciation trend in the greenback that's been brought about by loose monetary policy.
Experts said out of the four major central banks, the Fed is most likely to discontinue monetary easing.
This could see global interest rates edging higher over the next few years.
- CNA/ck
- wong chee tat :)
By Linette Lim | Posted: 15 March 2013 2218 hrs
SINGAPORE: Singapore's financial sector can be a test-bed for new yuan-linked products, according to Deputy Prime Minister and Finance Minister Tharman Shanmugaratnam who spoke at a banking industry forum on Friday.
The forum organised by the Financial Markets Association (ACI) was attended by over 700 delegates.
For instance, Mr Tharman said banks in Singapore can explore how to encourage offshore RMB bond issuance in Singapore with longer maturity tenors and different issuer profiles.
As the fourth largest foreign exchange trading centre in the world, Singapore can play an important role in integrating both the offshore yuan and Asian local currency markets.
This could be done through carrying out or booking trades in yuan or by developing yuan investment products.
He said: "While the US dollar will remain an integral global settlement currency, the renminbi (RMB) is likely to be increasingly used for trade denomination and contract pricing. As the (offshore RMB) market grows in multiple jurisdictions, regulators and market participants will have to work together to avoid fragmenting liquidity across markets and to promote efficiency in the offshore renminbi market."
While the yuan becomes increasingly important as a diversification currency for central banks and for trade among companies, the US dollar is seeing a gradual decline as an international reserve currency.
Still, experts said the dollar is likely to strengthen against other major currencies in the short to medium term.
Vice chairman of Blackrock, Philipp Hildebrand said: "Of course, we still have a current account deficit, but depending on what happens on the energy front, you can easily imagine the US moving into a current account surplus for the first time in decades, within a couple of years from now. Again that should be broadly supportive of the dollar."
So far, the US recovery is seen to be the firmest among the developed economies.
This could help reverse a long-term depreciation trend in the greenback that's been brought about by loose monetary policy.
Experts said out of the four major central banks, the Fed is most likely to discontinue monetary easing.
This could see global interest rates edging higher over the next few years.
- CNA/ck
- wong chee tat :)
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