September 11, 2019

Q&A with Ronit Ghose – Part 2

CFTE looks back at Ronit Ghose’s (Global Head of Banks Research – Citi) recent presentation titled Bank X: The New New Banks, where he answered questions from the audience about a wide range of topics. Click here to view the full presentation on BrightTalk.

Question: If you’re a CEO of a large bank that is overly exposed to Hong Kong, what would you do?

Answer: Based on the data I have, Hong Kong is one of the world’s most profitable banking markets in the world, full-stop! On average, the banking system in Hong Kong generates profits of US$200,000 per bank employee. In Singapore, it’s about US$120,000. No bank in continental Europe comes close to this, and this is with interest rates being relatively low.

In Hong Kong, there have been eight new digital banking licenses given, with two going to incumbents. So, if you consider four of the big banks, two have gone for a standalone banking license as a defensive mechanism. For the big one that didn’t, they have a very strong market position and they will have the budget to spend on digital and technology if needed. However, peak profitability is probably behind them. But in a way it’s a better problem to have compared to some continental European banks that have 1-2% ROE!

Q: What do you think is the current state of talent, how is it changing and what needs to be done to keep pace with change?

A: I think the bigger issue isn’t about talent – it’s about incentives, governance and strategic direction. Some of the smartest talents we know are went into these banks; if they’re not smart right now, something happened to them in there!

It’s very easy to say talent is only here in my cool Fintech startup and not in banks. There is a lot of talent everywhere. However, there is the question of training and relevance. The bigger issue is how you manage these organisations. Getting new skills and taking courses is great, but for me it’s more important to consider how you think about managing these companies and governance.

Q: How do we deal with the challenge of changing approaches to banking when it comes to the workforce?

A: This reminds me of a lunch we did in Singapore. There was a lady asking Huy how to essentially future-proof her kids! In context to your question, there are many people moving from big companies to Fintechs, startups and challenger banks etc. If I had been asked this, I would’ve said it’s not about their technical, accounting or legal skills. It’s a different thing that suddenly they realise they’re not used to – standing on their own two feet. It’s about going from being an agent to a principal. 

All of us who work in big companies know about this – agents are just passing the buck! That is the biggest difference – the culture and psychology. I hope most of the people in these big companies have the skill set to be able to retrain themselves if they wanted to. It’s all about autonomy and responsibility, and not just thinking like an automaton.

Click here to read part 1.

To watch the full presentation on BrightTalk, click here.

Click here to subscribe to the CFTE BrightTalk channel, where you can catch up on all our presentations in full.


About the AI in Finance programme

The CFTE AI in Finance course has been developed in partnership with Ngee Ann Polytechnic, a leading institute of higher learning in Singapore and features high-quality content taught by five senior lecturers and 18 industry experts.

With an easy to follow format, the course is perfect for busy professionals to understand the technologies behind AI and machine learning that are disrupting finance.

Click here to learn more about the CFTE AI in Finance course.


About CFTE

We are a platform supported by senior leaders from the largest institutions, startups and universities. We address the needs of professionals in finance to upskill in a rapidly changing industry being transformed by emerging technologies. More than 50,000 participants learn from our online courses, such as AI in Finance, Fintech Foundation or Extrapreneurship, a mini-MBA with fast growing startups such as Revolut or Shift Technology.


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