SMBC strengthens its domestic consumer finance and expands its international footprint
A case-study on the winner of the Best Retail Bank in Japan at The Asian Banker Excellence in Retail Financial Services Awards 2011. March 17, 2011 | ResearchIn the difficult operating environment of Japan’s retail banking industry in 2010, SMBC reinforced its retail strategy with initiatives such as the launch of its equity-related business focused on research and trading as well as affluent and high-net-worth segment. Through these initiatives, SMBC managed to achieve slow revenue and profit growth of around 3% in its consumer banking business. Private banking operations were introduced in June 2010 through leveraging on its wide customer base in Japan and using the unique product and services of its joint venture partner, Barclays Wealth. This addressed the need for the bank to diversify its product offering into the high-net-worth customer segment within Japan. SMBC also strengthened its consumer finance business as part of its retail business line-up, as it sees potential in the consumer finance business showing profitability in the medium to long run, with relatively thick spread. However in 2010 and the near future, banks might face refund claims and are studying the impact of the implementation of the Money-Lending Law and the bankruptcy of Takefuji. The bank also strengthened its credit card business which has a customer base of over 20 million. In addition to rolling out new products, the bank launched a number of key initiatives on the IT and data processing front, amongst others the rollout of a sales and billing management system and a delinquency management system. SMBC also became more active internationally, culminating with the listing of the bank’s parent company on the New York Stock Exchange. SMBC grew its international footprint through cooperation with Kotak Mahindra Bank to tap into new ventures in India, and the setting up of a fund management venture for Japanese companies seeking business opportunities in China. Despite the challenges in the Japanese economy this year, SMBC has displayed its resilience during these times and pulled through remarkably. ... Please login to read the complete article. If you already have an account, you can login now or subscribe/register.
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