The New Face of Bank Risk in Asia Pacific

A big topic for Chief Risk Officers around the world is the role of risk in a post-crisis world. Are we as protected as we thought? Do we have enough visibility into potential dangers ahead?

It’s such a hot topic that we recently gathered 33 CROs and their deputies from 11 countries across APAC at the inaugural Chief Risk Officer Forum in Thailand. Hosted by FICO and moderated by IDC, the forum provided a venue for in-depth discussion around the critical issues facing the region’s bankers. Attendees included United Overseas Bank, China Trust Bank, Citibank, China Merchants Bank, Samsung Card and Malaysia’s CIMB.

The consensus priorities that emerged from the discussions include similar issues as those occupying the minds of bank risk officers around the world:

• Effective management of consumer credit risk
• Success in selling a risk culture within your organizations
• Compliance in documentation and reporting
• Adoption of international best practices in credit risk
• Precise management of identity theft and fraud

It’s a familiar list to those of us who have been in the industry for a while. Iterations of these priorities have appeared in banking business plans for the past five years. Does that mean we haven’t made significant progress in Asia-Pacific?

Of course not. But as my colleagues have discussed in previous posts, the post-crisis world is going to be very different, and place even greater demands on us risk professionals.

We discussed in Thailand that the economic crisis has hit the “reset” button on economies around the world, and perhaps even more so in Asian markets like China and India. We can’t go back to banking as it was before — instead, we’re going to an uncharted future.

One where the Chinese credit consumer, not the US credit consumer, is the growth engine of the global economy. One where Indian banks are scrambling to create a whole new category of products and services to market to a new and rapidly growing middle class. It’s a new world for Asian banking, and a new world where Asian banks will have a brighter spotlight.

IDC, in its post-forum report, sees four themes that guide its six predictions for global risk management. For those of you that are interested in learning more about the discussions in Thailand, I encourage you to review.

Stay tuned for more on banking, risk and analytics in Asia.