Macao Affairs | July 2021 | Interview
Well Link Bank has established a network of seven branches across the city and introduced new technologies to improve customer service and seize niche market opportunities amid fierce competition from the bigger players. CEO Chong Sio Fai shared his vision for the bank’s future development, which should be closely linked to the development of the Grand Bay region. In the next two years, Well Link Bank hopes to open branches in neighboring cities of Guangdong. At the same time, the banking group, controlled by key shareholders in Macao, Hong Kong and Portugal, also keeps an eye on business opportunities in the Portuguese-speaking world, drawing on the networks of its predecessors.
The Well Link Bank was created, succeeding Macao Novo Banco Asia (formerly Banco Espirito Santo do Oriente). Tell us about this trip so far.
CSF – Our key strategy has been to establish an optimal distribution network in Macau. We now have seven branches in Macau and have almost completed the first stage of distribution planning in this type of development. We thought we had to be there to serve our large communities, and we manage to cover most of them today.
We are also preparing to expand our operations to the Grande Baie region.
Our board of directors has approved a resolution to create branches in the Grande Baie region and we have just started our preparation. We will see when we can have branches in the Grande Baie region. Maybe in a year or two, one or two branches in Shenzhen, Zhuhai, Hengqin and even in Hong Kong.
What is the rationale for your plan for the Grande Baie region?
CSF – We have seen good opportunities now, apart from the development of the Grande Baie region, the local government is also trying to moderately diversify its economy from tourism and games. There is a good mix that we can move towards, as the integration between the cities of the Grande Baie region intensifies and our expansion plan in the GBA is realized, the possibility of providing a service centered on the customer to these cross-border customers is there.
We must position ourselves in the process of integrating the Grande Baie. We need to focus on the wealth management opportunities between Macau and mainland Chinese cities and Hong Kong.
We have a broader mission to integrate ourselves into the development of the Grande Baie region. With or without us, the Greater Bay Area will be integrated. We are ready and we are preparing for this to happen.
Gradually, I think that more and more financial activities will be carried out between the cities of the Grande Baie region. For example, we provide mortgages for citizens of Hong Kong and Macao to buy homes in Mainland China, but not only from developers. We are talking about second-hand mortgages to citizens of Macau and Hong Kong to buy homes in the mainland secondary market.
Macau is a fairly populated place when it comes to the banking sector, with around 30 licensed banks in operation. How do you position yourself in the local market and what are your competitive advantages?
CSF – We invest a lot in Fintech and IT systems. We believe this is the key to the financial future. We have worked hard to put these scenarios in place for our clients to use our financial services and deal with their daily lives. We are building our electronic wallets and we have our other initiatives, such as providing online account opening services with facial recognition technology and applying big data analytics for client needs assessment, as well as AI to improve customer service and operational efficiency.
We have also installed smart teller machines: integrated ATMs for opening accounts and issuing cards.
In terms of customer service, you face competition from a few big players. How do you navigate this market?
CSF – We are not among the major players in the market, so we have to be different. We started by setting up branches in local community centers and gained customer recognition through quality services. We are evaluating the effectiveness of the current network. We just opened two more branches earlier this year, and they are barrier-free branches. We have received very positive feedback on this.
We can also better serve our customers by focusing on smart banking.
The first thing is to serve the local community well. We have improved our operational systems and streamlined our processes to deal with them. There is always a customer segment in the market that might not be of interest to the big players. There will be different angles to explore how to meet customer needs and niche markets.
We are offering a slightly higher interest rate to remunerate our clients because we have chosen not to invest too much in advertising and marketing and we are getting positive acknowledgments from our clients.
However, we believe that customer-centric service is the only key, that leveraging the development of financial technology and IT infrastructure will allow us to achieve this goal. .
Linked to this concept of corporate social responsibility is having branch offices that are barrier-free. What is your approach to developing local talent?
CSF – We believe that we ourselves should contribute and support the development of Macao’s financial industry, especially with regard to our responsibility to young people. Every year we employ new graduates from Macau universities. It is our clear human resources policy that internal promotion is always the first choice.
If there really is no suitable candidate internally, then we go externally. We need to send a clear message to our staff that the career development opportunities are there, for the right performers and the right staff.
The joint development of Hengqin is seen as the way forward for the local economy. And you have already gained a foothold on the neighboring island.
CSF – Yes. We have a research and development center in Hengqin. We are trying to expand it this year, in three to six months. A more important place was given to us and thanks to the support of the local government. It’s also good for the development of our fintech and IT staff. We don’t have a lot of qualified local professionals here, so we look to those in Shenzhen and Zhuhai. The best place for them is Hengqin, because they don’t have to cross the border.
The COVID-19 pandemic has also accelerated this. Our staff can just go to Hengqin and work with the experts there, so that they can learn and develop their skills and professionalism. In this way, we can help the young people of Macau to build their careers in the fintech industry.
Talk about the pandemic. How did you experience its impact?
CSF – We have clients who request loan repayment holidays, but the majority of our clients are not. We deal with them and carefully assess their repayment capacity. We are tolerant of these kinds of short-term impacts and must support our clients in difficult times. We seek to establish a long term relationship with our customers.
The impact of the pandemic on our business operations has been fairly minimal as the situation in Macau is remarkable compared to many places around the world. We have Macanese staff and staff from Hong Kong and the mainland. Today, the mobility of those passing through neighboring cities on the mainland has almost returned to normal, but it is still quite difficult for Hong Kong staff like me.
What types of improvements could be adopted in terms of the city’s regulatory environment?
CSF – The local regulatory environment is not 100% identical to that of other financial centers. I just think it’s pretty natural because the scope, volume and big players in the market are different. .
I firmly believe that when we expand our financial development, our regulatory infrastructure will be easily complete and supportive.
What direction do you see?
CSF – The infrastructure must be in place to facilitate future development. I guess we will position Macau as a financial and wealth management center. We may need improved legislative and regulatory infrastructure. In addition, more support services like lawyers, accountants and others. Education is also crucial, local university graduates must be fully trained to fuel this development, especially in the areas of finance and fintech.
We see some limits because young people in the past were not very keen on establishing their career in the financial industry, because it was not difficult to make money elsewhere. But now, after COVID-19, I’ve seen some of them change their minds.
Your predecessors, Novo Banco and Banco Espirito Santo do Oriente, had a historical connection with the Portuguese countries. How important is this to you?
CSF – It is in our heritage. We still own shares of Novo Banco and have experienced Portuguese senior executives such as Executive Director Artur Santos (former CEO of BNU), among others. And we still have a number of Portuguese clients.
It is an advantage that we have, to have this kind of connection and heritage with the Portuguese-speaking countries. It shapes our future development.
How could this be translated?
CSF – Our group is very keen to develop the whole network and is studying different opportunities. It could mean Portugal or Portuguese speaking countries in the future. Sooner or later, we expect that good coordination and a good connection with Portuguese-speaking institutions could be established.
Linking the markets of the Grande Baie region and the Portuguese-speaking region is our direction. We can do it. We have a strong bond and our group is very active in exploring opportunities.