Local Banks Lead in Singapore While Foreign Banks Set Standards in Malaysia

Singapore’s major banks have built a strong commercial banking proposition in their home market that is not only well ahead of foreign banks in terms of domestic service and capabilities but also matches them when it comes to international capabilities.


The Malaysian market, meanwhile, represents an “easier” opportunity for major foreign banks such as HSBC, Citi and Standard Chartered, who not only distinguish themselves against the several local banks on the international side, but are also often seen as providing better domestic service and product quality.


These findings are based on telephone interviews conducted by Greenwich Associates from August to September 2013 in Singapore and Malaysia with 602 corporates with annual revenues between $5 million to $500 million.


Singapore:  Domestic Banks Lead with Locals

DBS Bank has the largest commercial banking client base in Singapore and, together with smaller rivals UOB and OCBC, leads in client perceptions of domestic service and product capabilities. However, DBS Bank and UOB also match the major foreign competitors on client perceptions of the international service and products, making them a good choice for local corporates with international ambitions.


“Conversely, the major foreign banks find the Singapore market challenging since their international capabilities do not provide much in the way of advantage,” said Greenwich Associates consultant Fion Tan. ”Commercial banking clients here have more of a regional as opposed to global business focus, and as a result, the Singaporean banks’ Asian footprint often proves adequate.”


Malaysia: Foreign Banks in the Lead
Malaysia meanwhile represents a more straightforward opportunity for the foreign banks with a license in this market.


Although Maybank clearly has the largest client base, followed by CIMB, foreign banks lead when it comes to client perceptions of international service and capabilities. What’s more, several foreign banks are also seen as providing superior service and product capabilities on the domestic side.


“The strength of the foreign banks in this market is evident in the fact that clients give them such strong quality ratings, despite the fact that the foreign banks generally have much lighter branch networks than domestic competitors,” says Greenwich Associates consultant Paul Tan.