From China to Singapore, local Asian banks are upgrading the quality of their services and capabilities and attempting to compete with the global banks that have long dominated the Asian marketplace. Greenwich Associates 2012 Leaders for Asian Corporate Finance documents the progress domestic players are making in their attempts to close the gap with foreign rivals.
On a pan-Asian basis, global banks continue to dominate this market. Roughly three-quarters of all Asian companies have a corporate banking relationship with HSBC, approximately 60% do business with Citi and Standard Chartered Bank, about a third have a corporate banking relationship with Deutsche Bank, and 28% do business with ANZ Bank. These banks are the 2012 Greenwich share leaders in Asian large corporate banking. The list of leaders is similarly composed mainly of global banks in Asian large corporate cash management, large corporate trade finance and debt capital markets. Of all competitors in the Asian market, only HSBC ranks as a Greenwich quality leader in each of these businesses.
“The only local banks to appear on this years’ list of Greenwich share leaders are Bank of China, which ranks fifth in Asian large corporate cash management market penetration, and DBS Bank, which is tied for fifth place in debt capital markets,” said Greenwich Associates consultant Markus Ohlig.
However, local banks make a much stronger showing within individual Asian country markets:
- China: The major Chinese banks have a strong presence with corporates in China, led by Bank of China, ICBC and China Construction Bank. However, clients continue to consider the service quality and product capabilities of foreign banks to be stronger than those of Chinese banks, even within the domestic market and despite progress by local banks over the past few years.
- India: HDFC and State Bank of India rank among the leading banks in the country. Companies name Citi, Deutsche Bank and HSBC as the quality leaders in corporate banking. In cash management, HDFC has the largest market penetration. Axis Bank and Deutsche Bank rank among the Greenwich quality leaders in this group.
- Singapore: Corporate banking in Singapore is led by a mixture of major foreign banks, DBS Bank and OCBC. Foreign banks generally dominate cash management, with DBS Bank ranking just outside the top three. DBS Bank also joins foreign competitors as a Greenwich quality leader in corporate banking. The 2012 Greenwich quality leaders in cash management are Citi, Deutsche Bank and JP Morgan.
- Hong Kong: HSBC has established a clear leadership position in Hong Kong both in corporate banking and in cash management. The bank’s large presence is also reflected in its qualitative leadership in corporate banking, although Standard Chartered Bank and Citi join as Greenwich quality leaders in cash management services.
- South Korea: Contrary to most other Asian markets, several local Korean banks are counted as strong competitors to foreign banks in terms of product capabilities and services both in corporate banking and cash management. This high level of quality has helped local banks capture a leading position in terms of market penetration.
- Trade finance: Across Asia, the banks with the largest market penetration in trade finance are HSBC, Citi, Standard Chartered Bank, Deutsche Bank, and the Royal Bank of Scotland (RBS). Included in the list of 2012 Greenwich quality leaders in trade finance are JP Morgan, which has only recently started to build up its trade finance business in Asia, and DBS Bank, which has strong regional ambitions for its transaction bank.
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