Banks advised to continue to beef up capacity, capability

KUALA LUMPUR: The banking industry should continue to develop the capacity and capability to manage risks arising from domestic as well as cross-border operations.

Asian Institute of Chartered Bankers chairman Tan Sri Azman Hashim said the industry should invest more in technology and enhance operational processes to reduce costs and improve service delivery to meet the needs of the customers.

He said the industry has become more complex.

"It is operating in a highly-regulated environment and the competitiveness of banks is defined by their ability to innovate and maximise their assets.

"They have also invested in human capital to ensure their risk and compliance practices and policies are established in order to keep pace with the fast-changing environment," Azman said.

Azman said this in his keynote address at the Global Banking Conference, themed "The New Banking Paradigm - Disruptions, Risks and Opportunities" in Kuala Lumpur on Wednesday.

He said experienced board members were critical in managing the new operating environment, including new business models, while guarding against the attendant risks.

He said the industry faced financial integration and cross-border banking and investment activities which would open new opportunities such as sources of revenue for the financial sector.

"We would all agree that our industry is facing significant disruption from a variety of sources," he said.

Azman said the industry needed to respond urgently as new entrants moved in, engaged easily with clients and offered alternative services some of which were more flexible than what the industry has traditionally offered.

Azman said the Financial Services Board, which was launched in 2014, would launch its Code of Ethics for the Financial Industry next month.

"The code aims to raise the bar or professionalism and ethics across the financial services industry to help restore, maintain and enhance public trust," he said. - Bernama