Leading Asian Companies ‘Seeking to Change Banking Relationship’

Asia’s top 1000 institutions are increasingly on the move, with more than 60 of these leading companies indicating they intend to change their primary banking relationship in the next six months, claims East & Partners.

The research, which coincided with open markets briefing held by the banking research and advisory firm in Hong Kong and Singapore, shows that in addition to those institutions definitely planning a banking change, the number of those indicating they would ‘probably’ or ‘possibly’ change was also rising, with the number of restless customers at 42.7% in research conducted in November 2012, up from 37.9% in the previous research round held in May 2012.

The East research shows that debt offerings are the most common reason for bank churn, nominated by 83% of institutions, while 67.3% indicated that a lack of value in the relationship was the second most important churn driver. Value for money was ranked as the third reason.

East & Partners top 1,000 Asian companies

Lachlan Colquhoun, head of markets analysis at East & Partners, said the firm’s research on product importance and customer satisfaction showed wide gaps between expectation and delivery, gaps which were driving churn. “We see that to drive growth, debt is the most important tool for the institutions, and yet this is the main factor driving them to change banks,” he said.

“This restlessness is also the reason we see institutions spread their wallet among several providers, as a way of managing their own risk in their exposure to debt providers.

“Our research shows that the wallet share for primary transaction banking relationships is in a steady decline, while that for secondary relationships is rising across the board. This, of course, presents opportunities for banks as secondary providers as these secondary relationships can often develop into primary relationships if the banks can prove themselves to the client.”

East’s bi-annual
‘Asia Institutional Transaction Banking Markets’
programme analyses the top 1000 institutions by revenue across ten Asian countries excluding Japan.

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