BANK MANAGEMENT

Bank Management



Bank Management

Singapore Banking Industry

Singapore, the smallest nation in South-East Asia, has a land area of 710.2km2. (Singapore Department of Statistics, 2008) Despite being small, it is renowned as a leading Asia Financial Hub since the last decade with its politically stable environment, strong economic fundamentals, a well developed physical and financial infrastructure as well as a strategic geographical and time zone location. (Hew, 2002) Since the Asia Economic Crisis that took place in 1997, the Singapore government saw a need for further consolidation of the local banks in order to stay competitive. From a speech by Mr Lim Hng Kiang, Deputy Chairman of Monetary Authority of Singapore (MAS), the crisis is a clear signal that the financial services sector is a global industry. (MAS, 2002) Small banks are no longer able to compete with the larger international banks. As Singapore's Prime Minister Mr Lee Hisen Loong puts it in a ministerial statement on July 2001, “the industry is characterized by large economies of scale”. Only large banks will have sufficient resources to compete in this globalised environment.

Under the Banking Act, all commercial banks in Singapore are licensed and governed. Banking sector of Singapore can be soon emerged as the strongest in the world due to the international repute servicing in domestics as well as international market (Agarwal et.al, 2013). The banking sector of Singapore supports the entire country and therefore results in the increased economic growth. Many people believe that this economic centre has deepened its roots due to continue adaptation of new technologies into the country (Agarwal et.al, 2013). Singapore and Hong Kong are being considered as the developed economic hub in Asia, whereas India and China are considered as the emerging ones. Though, the country is very small but the life style of the people living in Singapore can be judged from the per capita income of the people which is increasing every year.

Apart from this the main reason behind the performance of the country can be considered due to the stable political environment. This is because economy itself is not the key to success, but the stable political environment is the key to success for any country. Hence, thus the stable political environment results in the sound economy of the country (Agarwal et.al, 2013). This sound economy supports the other organs of the state including various institutions and corporations supporting the overall growth of the country. So, it's clear that Singapore sound economy and political environment has led the other sectors of the country to perform significantly (Lim et.al, 2013 pp. 91). Tax and legal conducive environment also support the foreign direct investment in the country. Singapore also emphasize on the strong and strict enforcement against money laundering and crime along with reputation of integrity (Lim et.al, 2013 pp. 91).

Image retrieved from http://www.sciencedirect.com.ezproxy.liberty.edu:2048/science/article/pii/S0167668713001091

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