Speech by Ms Indranee Rajah, Minister in the Prime Minister's Office, Second Minister for Finance and Education at The Standard Chartered Bank 16th Anniversary Celebration Dinner, 13 February 2019, The Ritz-Carlton, Millenia Singapore

Standard Chartered Bank 160th Anniversary

WINDOW TO THE PAST, PORTAL TO THE FUTURE

Ms Judy Hsu, Regional CEO, ASEAN & South Asia

Mr Patrick Lee, CEO, Singapore

Distinguished Guests

Ladies and Gentlemen

A very good evening.

1. I am delighted to join all of you this evening in the celebrations to mark Standard Chartered Bank’s 160th anniversary.

Reflections on a Shared Journey 

2. What makes this extra special is that your 160th anniversary also coincides with our Bicentennial year, in which we are commemorating the founding of modern Singapore in 1819 in the context of our longer 700-year journey, and recognising the different people and communities who have joined us on our journey to becoming the global city that we are today.

3. StanChart is without doubt an organisation that has made that journey with us. StanChart has had a rich and long presence in Singapore. From the time that it opened its first branch here in 1859, it has grown and transformed in tandem with our island nation, traversing our historical voyage as a colony and part of the Straits Settlements; through the 20th century with the Second World War and the Japanese Occupation, Merger, Separation, Independence, and into the 21st century which saw SG50. 

4. Throughout this time, StanChart has always had a home here in the central business district, from Battery Road, Shenton Way to Raffles Place, supporting the engines of our economy such as trade, commerce and construction through your financial services. In 2011, it was the first bank to move into the new downtown financial district and anchor at Marina Bay Financial Centre. 

5. But anniversaries and bicentennials are not only about the past. Because they are temporal milestones, they mark where one period ends and another begins. They are therefore also harbingers of the future. It is thus apposite for me to say something about what lies ahead for the banking and finance industry, and what StanChart and Singapore can do together in the next forward lap of our journey.

A Horizon Scan

6. It will come as no surprise to anyone here that the immediate future is marked by uncertainty. Geopolitical events that are being played out and the accelerating pace of technological change present ongoing challenges to all sectors.

7. Weakness in Europe and some emerging markets, US-China trade tensions, and a possible “no deal” Brexit, has led the International Monetary Fund to cut its world economic growth forecasts for 2019 and 2020 and the World Bank to warn of “darkening skies”. The resultant drag on the world economy has been dubbed “Slowbalisation” by the Economist.

8. Technology continues to be a disruptor. From digitalisation and Big Data to the advent of frontier technologies such as Artificial Intelligence (AI), the blueprints for future businesses, smart cities, future factories and Industry 4.0 are still being written. 

9. The uncertainties are amplified by increasing regulatory scrutiny and climate change.

10. However, that is not the whole picture. There are also many positive things on the horizon, both near and long term.

11. Business sentiments from recent surveys remain steady and forward-looking. Globalisation may have slowed, but it is still a driving force.

12. The DP SME Development Survey 2018 revealed that although SMEs are expecting a decline in turnover, SMEs are still looking to expand abroad, especially in Asia.

13. This sentiment is not surprising, having regard to the longer term projected growth of Asia and ASEAN, where Asia’s share of global GDP will reach 40% in 2030, near-term uncertainties notwithstanding.

14. ASEAN as a region has sustained positive economic growth. The region is on track to becoming the world’s fourth largest single market by 2030. It is also experiencing exponential growth in the digital economy with 350 million internet users, and more than 3 million going online for the first time every month.

Positioning for the Future

15. So the issue is not so much whether or not the immediate outlook is challenging, but rather how we can position ourselves and chart a steady course for the future, uncertainties notwithstanding, by leveraging on the positive factors.

16. Let me share some of the Government’s thoughts on how we intend to go about doing this.

Openness

17. The establishment of Singapore as a free port in 1819 was a game changer. It was the only free port of its time and it disrupted all other contemporary ports. 

18. The growth of Singapore was also propelled by immigrant communities which sank roots here, and who over time made this their home, contributing in myriad different ways to building Singapore. 

19. Openness and multiculturalism have been major contributors to our success and have become part of the Singapore DNA. Hence, we will continue to keep our economy, and regional and international ties open. We welcome those who can contribute to our country and society, help build capability and, importantly, forge positive relationships with our people.

Riding on Asian Growth

20. The growth potential of Asia and ASEAN present exciting opportunities.

a. There has been a surge in capital-raising needs for the region.

i. The regional startup scene is thriving, with 43,000 startups in Singapore alone. 

ii. Asia’s share of companies with market value of more than US$10 billion has been growing, from 20% in just 10 years ago to more than 30% today.

b. Singapore is well positioned to take advantage of Asia’s growth potential by serving as a financing hub for Asian enterprises. The Government has introduced several initiatives to meet the need for capital.

c. The Monetary Authority of Singapore (MAS) recently launched the Private Market Programme under which it will invest US$5 billion of its own funds in the private markets, to strengthen financing channels to support enterprises. This is aimed at getting management with private equity and infrastructure fund managers to build out their presence in Singapore.

d. For public equity markets, we have launched a new S$75 million grant scheme to support equity financing for domestic and international growth companies. This scheme includes: (i) a Research Talent Development Grant to groom equity research talent; (ii) Research Initiatives Grants to support industry initiatives that can develop Singapore’s equity research ecosystem; and (iii) Listing Grants to facilitate enterprises seeking a listing on the SGX by defraying part of their IPO costs, with higher funding tiers focusing on enterprises in new technology and high growth sectors.

21. The new grant is part of a broader suite of initiatives supporting the financing needs of growth enterprises and strengthening Singapore’s position as the go-to venue in Asia for enterprises seeking growth financing. We welcome financial institutions to grow their corporate finance and research capabilities out of Singapore, and be well-placed to capture the vast opportunities presented by the growth of Asian enterprises. 

Innovation

22. Next, innovation. The key to the future is innovation. All sectors will have to increase productivity and enhance the value of their services through innovation. The banking sector is no exception and indeed, with the resources at its disposal, it is imperative that it be at the vanguard of innovation.

23. StanChart has seen many innovations in the course of its long association with Singapore. Let me highlight a couple.

24. If you had deposited money with StanChart in 1937, this is what you would have received - a hard copy receipt slip. Notice the beautiful handwriting by the way - not many bank officers can produce such exquisite copperplate calligraphy anymore! Receipts in today’s digital age are all in pixels and codes, or automated notifications to your mobile phones. 

25. Decades ago, The Chartered Bank introduced mobile banking - no, not what you are thinking, but groundbreaking nevertheless – these are mobile banks on buses which literally brought banking to their customers. Today, of course, “mobile banking” has a very different meaning - banking transactions done with a tap or a swipe of our mobile phone screens, along with facial or fingerprint recognition. But both types of “mobile banking” are innovations of their time, driven by the same objective – which is to bring banking closer to customers, wherever they might be.

26. In 2017 and 2018, StanChart joined the ranks of pioneering participating banks in Singapore to support the nation’s e-payment strategy and rollout of new digital payment initiatives to its customers such as PayNow and PayNow Corporate. 

27. StanChart also plays an active role in the key governance committees which steer the responsible growth of the e-payment ecosystem in Singapore. These committees include the Payment Council, and Singapore Clearing House Association. 

28. We are therefore delighted that StanChart is partnering us on our innovation journey. 

Helping People to Adapt and Grow

29. Next, people. As digitalisation and automation become more prevalent in the financial industry, our people will be affected as jobs evolve. 

a. There is a need to place emphasis on people and skills. 

b. The extent to which businesses can capture productivity gains depends on how quickly the workforce is equipped with new skills to leverage technology to perform new tasks or roles. 

30. Workforce transformation is thus critical as businesses transform, and StanChart has realised this early. 

a. StanChart is one of the early movers to support its employees to re-skill and up-skill to take on jobs of the future. 

b. One example is its participation in Professional Conversion Programmes for workers in Consumer Banking and Operations, one of the many banking functions to be disrupted. 

c. StanChart also introduced SkillsFuture@SC, a plan to upskill more than 3,000 employees over three years.

31. There will inevitably be disruption to workers, as businesses embrace technological advancements to compete in a fast-changing world, but our workers will be up to this challenge if they are resilient and willing to learn new skills to be future-ready.

a. The transition will not be pain-free, but the fruits of perseverance will be there. 

b. It is important that StanChart press on with this endeavour - to continue planning ahead and providing employees with opportunities to evolve along with the organisation.

c. The Government, together with industry partners such as the Institute of Banking and Finance and the labour movement, will support banks and their employees on this journey.

Infrastructure Development and Financing

32. Next, infrastructure. Infrastructure demand in Asia is growing rapidly, underpinned by its growing population and rapid urbanisation. Infrastructure finance thus represents a growth area for the banking industry, especially as initiatives like China’s Belt and Road, the US’s BUILD Act and Australia’s Infrastructure Financing Facility for the Pacific look to support infrastructure development in Asia’s developing countries. 

33. As a global financial centre and home to a strong ecosystem of infrastructure players, Singapore is ready and able to contribute to Asia’s infrastructure development and financing needs.

34. Last October, a new organisation - Infrastructure Asia - was set up by Enterprise Singapore and MAS to connect demand and supply for infrastructure projects, and serve as a bridge between project sponsors, projects in the pipeline, industry players, private sector and multilateral development banks and government agencies. In particular, Infrastructure Asia aims to connect good-fit solutions to infrastructure needs in Asia, and improve access to financing across the infrastructure lifecycle.

35. It is not always easy for banks to fund large infrastructure projects by themselves because of the financial, political and other risks involved. However, combining with other funders and partnering with multilateral, bilateral and private providers of risk mitigation can help to spread risks and thereby mobilise capital from the private sector for infrastructure projects. With its overview of the infrastructure space, Infrastructure Asia can help banks connect with suitable partners and potentially access a wider and more diverse pipeline of projects. 

36. Understanding institutional investors’ interest in infrastructure as an asset class and banks’ interest to recycle capital to lend to new projects, Infrastructure Asia and MAS are also working to facilitate asset securitisation and take-out financing. Their efforts are showing promise. In 2018, Clifford Capital successfully launched Bayfront Infrastructure Capital, which is the inaugural project finance loan securitisation transaction in Asia. StanChart acted as the Joint Global Coordinators and loan contributing bank. This transaction has demonstrated that there is healthy investor appetite for emerging market infrastructure debt, and that it can be mainstreamed as an investible asset class. 

37. I therefore encourage all private sector banks to work with Infrastructure Asia and MAS in this growth area.

Sustainability and Green Finance

38. Next, a few words on sustainability and green finance. 

39. The climate is changing.

a. A recent UN report cited the last four years as the hottest recorded in history!

b. At the other extreme, the recent polar vortex has plunged the US Mid-west to a temperature of minus 49 degrees celsius, freezing lakes, cracking the earth and turning boiling water into snow instantly. 

c. The oceans are getting warmer.

d. Icebergs and glaciers are melting. 

e. Sea levels are rising.

f. Animal habitats and marine immigration patterns are changing. This will in time affect food supply chains. 

40. This is being exacerbated by deforestation, environmental pollution and unsustainable urbanisation. The need to reverse these trends is real and urgent.

41. In this, banks and financial institutions are in a unique position to make a difference. You are powerful players to drive the necessary change.

42. Infrastructure and business cannot take place without financing. Making sustainability and green practices prerequisites for financing can make - quite literally - a world of difference.

43. Singapore strongly supports sustainability and green financing. Although we are still at the early stages of mainstreaming sustainability into finance, we have seen some success in encouraging the use of debt capital market financing towards sustainability projects. 

44. Recently the World Wildlife Fund launched its Asia Sustainable Finance Initiative (ASFI) here in Singapore. The ASFI provides multi-stakeholder engagement channels and educational programmes for sustainability. 

45. So I would urge all financial institutions, either of their own accord or in collaboration with ASFI and other relevant partners, to collectively develop and promote green financial solutions that will facilitate real and meaningful change.

Banks and the Community 

46. Banking is more than just about dollars and cents. Banking is also about the strength of the relationship between a bank, people and the community. StanChart’s understanding of this fundamental insight can be seen from its brand campaigns over the years.

47. Those of a certain age - like me! - will have a vivid recollection of StanChart’s famous 1980s brand campaign with its slogan “Big, Strong and Friendly”! What made that tagline so relatable and enduring? It is not just that it was simple and easy to remember. It is essentially because rather than describing itself with reference to the financial services offered, the bank projected itself in terms of its positive relationship with customers and the world at large.

48. This sense of relationship has continued in subsequent campaigns such as the 2010 “Here for good” and the more recent variation “Good enough will never change the world” which signal your desire to make a positive social impact. I understand, for example, that every StanChart employee is given three days of paid leave each year to do volunteer work, and the bank has organised various volunteering initiatives that reach out to the elderly, needy families, and the visually-impaired. 

49. StanChart’s brand promise is very much in alignment with the Government’s efforts to promote volunteerism and philanthropy. 

50. We recognise that one of the challenges faced by organisations who want to do good is identifying and lining up with people and projects that are in need of assistance.

51. So to this end, we have initiated SG Cares, co-led by the National Volunteer & Philanthropy Centre and the National Council of Social Service, a nation-wide movement to support efforts in building a caring and inclusive home for all, through everyday acts of consideration and active volunteerism. Through SG Cares, the Government seeks to set up a better framework to connect those who want to volunteer with those in need of volunteer assistance.

52. I would therefore strongly encourage StanChart to partner with SG Cares to further your brand promise of doing good. 

Conclusion

53. I don’t know how many of us present here today will be around for StanChart’s 200th anniversary in 2059, or Singapore’s 250th anniversary of modern founding in 2069.

54. However, what I do know is that the things we do today will determine where your bank and our country will be when those years are reached. Hence, it is imperative that we do the right things today to secure the future and well-being of the next generation and our world. So let us do good together! 

55. With that, thank you very much. Happy anniversary and congratulations once again to Standard Chartered Bank.

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