Country awards: why they won, part three

The rationale behind the decisions taken by our judges in the awards for Singapore, Sri Lanka, Taiwan, Thailand and Vietnam.

In May, FinanceAsia named the winners of its Country Banking Achievement Awards for domestic banking in countries across the Asia-Pacific region. Lists of winners are here, here and here.

The competition was extremely tight this year, with numerous financial institutions proving their resilience in a difficult regulatory and banking environment.

Here, we explain in detail the rationale behind the - often very difficult - decisions that our team of judges came to in the awards for Singapore, Sri Lanka, Taiwan, Thailand and Vietnam.

For decisions from Bangladesh, China and Hong Kong, click here.  For decisions from India, Indonesia, Korea, Malaysia, Mongolia, Myanmar, Pakistan and the Philippines, click here.



DBS is FinanceAsia’s pick for Best Bank in Singapore because the lender continues to deliver strong performance amid concerns over the slowing Chinese economy, increasing foreign exchange fluctuations, and plunging oil and gas prices.

Against all these headwinds, DBS managed to increase its total income by 12% to S$10.8 billion ($7.8 billion) in 2015 when most of its local competitors recorded earnings declines. It was even a landmark year for DBS as total income exceeded S$10 billion for the first time.

The Singaporean bank also improved its return on equity to 11.2% from 10.9% in 2014, while net interest margin reached a five-year high of 1.77%.

Digital innovation and transformation has been key to DBS in recent years. Recognising the changes in customer behaviour at a time when smartphone and social media usage is exploding, DBS continues to invest in electronic banking and peer-to-peer payment systems.

Among its innovations, DBS pioneered digital account opening in Singapore, which allows new customers to open deposit or credit card accounts through digital platforms. DBS customers are no longer required to visit a bank branch to open an account.

As a result of the technology push, nearly 70% of financial transactions conducted by DBS’s 2.5 million internet banking and 1.4 million mobile banking users are now taking place through digital channels, underscoring the importance of digital transformation to the bank’s operations. 

At the beginning of 2016, DBS entered into a 15-year bancassurance partnership with Manulife that allows the Canadian insurer to sell its insurance and wealth management products to the bank’s clients. As part of the partnership, DBS and Manulife agreed to co-invest as much as S$100 million in digital technology and innovation enhancements over the next 15 years.

In the investment banking space, DBS maintained its leading position in the strategic advisory business among local banks. Despite a relatively slow year for mergers and acquisitions, DBS was involved in local transactions including Singapore Airlines’s $1.1 billion privatisation of Tiger Airways and Baring Private Equity’s S$450 million offer for Singaporean precision engineering company Interplex.

In a year characterised by insignificant equity capital markets activity, DBS managed to advice on the only initial public offering – BHG Retail REIT’s $180 million transaction. The bank also conducted 10 follow-on offerings for SGX-listed companies when market sentiment remained weak throughout the year.

Finally, DBS remained the top bookrunner for Singapore dollar bonds in 2015 while expanding its distribution capabilities in the G3 bond market. It was ranked first in the overall debt capital markets league table in the awards period, raising $6.4 billion for its clients through 63 deals, according to Dealogic. 

It had a dominant market share of 31.2% during the period, far ahead of Oversea-Chinese Banking Corporation, the runner-up with 12.2% share.


DBS Vickers has consistently been one of the top-five brokers based on trading volumes in the Lion City. But given the relatively illiquid Singapore stock market and the limited growth of SGX stocks, it has also diversified into other Asian markets including Hong Kong, Thailand and Indonesia.

In particular, Hong Kong has overtaken Singapore as DBS Vickers’ top revenue contributor.

DBS Vickers is also penetrating new markets by partnering with local brokerages. For example, the Singaporean brokerage shares sales and trading resources with First Metro Securities in the Philippines and is a partner with KTB Investment & Securities in South Korea. It also runs a joint venture with Alliance Investment Bank in Malaysia.

DBS Vickers has expanded its research capabilities to 85 analysts covering 663 stocks across the region. To differentiate itself against other global investment banks, DBS Vickers has focused on small- and mid-cap companies particularly in Hong Kong, which houses the biggest team of 26 analysts.

Sri Lanka

BEST BANK: Commercial Bank

This has always been Commercial Bank’s award to lose and the bank shows no sign of handing over its crown any time soon.

It beats its private sector competitors by a significant margin and less efficient public sector ones by even more.

2015 was nonetheless a more difficult operating environment for the Sri Lankan banking sector. That was partly due to fall-out from a shaky global economy but also because of presidential elections, which led to the ousting of strongman Mahinda Rajapaksa, and parliamentary elections, which enabled the new coalition government to consolidate its power mid-year.

As a result, GDP growth slipped from 4.9% to 4.8% last year. The country was subsequently also granted a $1.5 billion loan from the IMF to ease a balance of payments crisis and help service the large amount of Chinese debt taken on by the previous government to finance unsustainable infrastructure projects, including some close to the former president’s hometown. 

Despite this inauspicious setting, Commercial Bank in 2015 increased assets by 11% year-on-year and raised net income by 6.5% to Rs11.9 billion  ($81.2 million). Executives say they were particularly pleased that the current account, savings account ratio improved to 54.51% thanks to a 6.79% rise in interest income and a lesser 3.11% rise in interest expenses.

However, the whole Sri Lankan banking sector saw margins squeezed, with the bank’s net income margin dropping from 4.05% in 2014 to 3.77% in 2015, according to S&P Global Market Intelligence data.

Its data also shows that Commercial Bank’s cost-to-income ratio rose slightly to 51.20% in 2015 from 50.51% in 2014, while its return on assets fell to 1.42% from 1.62% and its return on equity dipped to 16.94% from 17.26%. One positive improvement was a drop in gross non-performing loans from 3.47% of total loans in 2014 to 2.74% in 2015.

One of the most striking new initiatives has been the bank’s growing commitment to green finance. During 2015, it launched green development loans at concessionary rates for companies, which are trying to improve their environmental footprint.

The bank has also made moves to enhance its own environmental credentials by opening green branches with solar panels and reduced use of paper. That fits into a second automation theme. Commercial Bank’s online banking increased by 25% year-on-year, for example, while mobile banking was up 24% year-on-year.

The bank also took further steps to expand overseas, opening up its first branch in the nearby Maldives and Sri Lanka’s first bank branch in Myanmar. 



Banking is one of the most competitive sectors in Taiwan given the large number of players in the market. The economic situation was also far from ideal last year, with the island’s GDP growth hitting a six-year low of 0.85%.

Against this backdrop, CTBC Bank continued to deliver strong performance, particularly in areas where it has long led the market. The lender remained the top credit card issuer last year with a 15.2% market share, despite sliding by 0.2 percentage points.

CTBC Bank also maintained its leading position in wealth management, gaining an 18% market share in mutual fund sales and a 12.7% share in bancassurance sales —at least one-third more than its major competitors.

In terms of technological innovation, CTBC Bank is the only bank to have received regulatory approval to launch cardless cash withdrawals. It is currently developing a finger vein identification system that allows customers to withdraw cash from automatic teller machines without bank cards.

CTBC’s non-performing loan ratio remained low at 0.29% while its coverage ratio stood at 168.4%, underscoring the bank’s stringent risk management control. Its A-/A/A2 long-term credit rating was one of the highest among Taiwanese banks.


Yuanta has been the largest broker in Taiwan for more than 15 years and maintained that lead during the review period. It ranked first in brokerage, margin financing, stock lending and futures trading in 2015 with at least 10% market share in all categories, according to Taiwan Stock Exchange data.

Yuanta Securities was also a clear leader in domestic debt capital markets, taking nearly one-fifth of the market during the award period, when it completed 27 deals and helped clients to raise a combined $725 million, according to Dealogic.

Uncertainties in the Taiwanese economy and the central bank’s repeated interest rate cuts since mid-2015 caused a sharp decline in corporate bond issuance.

So to maintain its market share, Yuanta successfully leveraged on its balance sheet to underwrite some of the transactions.

In 2015 Yuanta expanded its Formosa bond underwriting business, involving itself in 24.84% of Formosa bond issuance, almost double its share in 2014.

During the award period, it also helped clients including Goldman Sachs, UBS, Morgan Stanley, HSBC, Citigroup, and Korea Development Bank to issue euro-denominated bonds, as well as Maybank, Deutsche Bank, Macquarie Group and Credit Agricole in their renminbi bond issuance.

In the M&A advisory business, Yuanta was a sell-side advisor for US chipmaker Micron Technology’s $4 billion acquisition of Taiwanese wafer manufacturer Inotera Memories, one of the most high-profile cross-border transactions in Taiwan last year.

BEST ECM HOUSE: Fubon Securities

Taiwan’s market for initial public offerings has largely been dominated by local brokerages because of the relatively small deal size and the high level of participation from retail investors.

During the award period Fubon ranked second in Taiwan’s equity capital markets league table with a 17.8% market share. It arranged 32 equity transactions totalling $1.1 billion, trailing only China Development Financial with $1.3 billion.

Fubon was nonetheless awarded Best ECM House in Taiwan because it demonstrated strong underwriting and distribution capabilities in transactions such as Mega Holdings’s NT$5.8 billion ($178 million) exchangeable bond offering and Nien Made Enterprise’s NT$4.4 billion IPO.

In the case of Mega Holdings, Fubon secured the mandate after the company failed to conduct the transaction for the first time. In the second trial, Fubon built the book amid a sharp decline in the benchmark Taiwan Stock Exchange Weighted Index but it managed to pull together both short- and long-term investors and ensured stable after-market trading.

The transaction was the largest secondary equity offering in Taiwan last year.

In a separate case, Fubon helped Nien Made Enterprise with corporate restructuring after it was acquired by CVC Partners and delisted from the stock market in 2007. Measures including reducing its production costs and altering its business model helped the window covering maker to achieve a significant improvement in profitability.

At NT$4.4 billion, Nien Made Enterprise was the biggest IPO in 12 months when it relisted on the Taiwan Stock Exchange in December last year.

For more winners, see page two


BEST BANK: Kasikornbank

It has been a tough time for Thailand. The country’s economy grew just 2.8% in 2015 and may only see a slight uptick to 3% this year. That has left many businesses sweating and hasn’t helped banks either, with all the main lenders having recorded drops in profitability and increases in non-performing loans.

However, in these trying times Kasikornbank reaped the fruits of many years of technological and risk management investment. So not only did its small-and-medium enterprise lending business grow, it also kept a lid on bad debts.

The bank is considered to have the best risk management assessment and experience of dealing with SME customers, and analysts feel it is the most likely lender to keep a rise in bad assets in check.

That said, some of Kasikornbank’s financials look pretty grim. Its net interest margin has eased from 3.66% in the last quarter of 2015 to 3.62% at the end of March. The bank’s net profit of Bt39.47 billion ($1.1 billion) for calendar year 2015 was 14.47% lower than the Bt46.15 billion recorded a year earlier, and it suffered a 22% quarter-on-quarter drop to Bt9.65 billion in the first quarter of 2016 as bad loan provisioning increased.

But there were some areas of improvement. Its cost-to-income ratio was just 37.21% in the three months to March, down from 54.55% the previous quarter, while it stood at a competitive 45.19% for calendar year 2015. Meanwhile, it made more fee and non-fee income in 2015 (Bt37.53 billion) than in 2014 (Bt33.94 billion), while its tier one capital stood at 13.79% at the end of 2015, up from 12.88% the previous year.

Analysts note that the bank generates more fee income than its main rivals, particularly from SMEs, transactional products, and insurance, offering it more diverse revenue streams.

The lender has also been developing systems to better cross-sell products such as insurance to its retail and commercial customers, which should continue supporting its fee income.

And Kasikornbank’s deposit base stood at Bt1.75 trillion at the end of March; a strong level that has helped to support it during economic volatility.

Kasikornbank’s management are continuing to invest in the business, judging that their bank needs to be the most competitive standing when the economy does strengthen once more. It looks well set to do so.


It’s hardly a coincidence that Siam Commercial Bank, an institution that boasts strong relationships with Thailand’s leading corporates, also enjoys vibrant equity and debt deal flow across the country.

Onlookers say the bank uses its balance sheet to win capital markets mandates. Some sniff that this isn’t proper investment banking but it’s undeniably effective and continues to net SCB many lead positions in the country’s largest deals.

As a result SCB takes home our Best Investment Bank award, along with the accolades for Best ECM house and Best DCM house.

The numbers don’t lie. SCB stood first for deal flow in equity capital markets between April 2015 and March 2016, having been responsible for the equivalent of $825 million in ECM deal volume over the period.

That gave it a 33% market share, according to data provider Dealogic, way ahead of second-placed Kasikornbank’s 9%.

Included in SCB‘s deal flow are the top-two equity capital market transactions by size during this time. SCB was the sole financial adviser and underwriter of North Bangkok Power Plant Block 1 Infrastructure Fund’s Bt20.85 billion ($604 million) initial public offering in July 2015 and acted as one of six bookrunners for Star Petroleum Refining’s Bt19.9 billion IPO in November.

On the debt capital markets side, SCB stood as a top-three local bond house. While it missed out on the largest deal of the year – a $1.065 billion two-tranche bond for Bank for Agriculture and Agricultural Cooperatives – it was a bookrunner on Siam Cement’s $716 million bond in April 2015 and helped to arrange a $384 million bond for CP All in June that year.

More impressively, SCB received the backing of the Thai Bond Market Association, which named it the largest corporate underwriter of bonds for 2015.

The bank was also a bookrunner on Mizuho Bank’s Bt3 billion three-year bond in September 2015, which marked the first time a borrower had utilised the Asean +3 Multi-Currency Bond Issuance Framework structure to conduct a deal.

The combination of vigorous ECM and groundbreaking DCM bookrunning meant SCB enjoyed a leading position in what was an admittedly tough period for Thailand’s capital markets.

BEST BROKER: Phatra Securities

Strong broking is not always an easy task, particularly amid difficult market conditions. But Phatra Securities continues to utilise a reputable and well-respected research capability to ensure its clients are well-advised when making their investment and trading decisions.

For many years Phatra has had a close relationship with Bank of America Merrill Lynch, formed through the US bank’s former ownership of a stake in the company. That proximity has helped to hone Phatra’s research capabilities, which are co-branded with BAML.

Some investors told FinanceAsia that they consider Phatra’s research to be the best available in the local market. And while it isn’t the very best retail broker it’s no slouch in the institutional space, claiming market shares of a touch over 10% in both foreign and local institutional equity broking.

In addition to its institutional strengths, Phatra enjoys a decent business advising high net worth individual and non-institutional corporates on where to invest their funds. This business has expanded at a compound annual growth rate of almost 24% over the past five years; its assets under advice were $9.5 billion as of March 31.

Last year Phatra also rolled out a one-stop broking platform under its Phatra EDGE service, which targets mass-affluent investors. The platform lets them take their pick and trade a set of investments.

The company isn’t content to remain in Thailand alone and is now eyeing opportunities in neighbouring Laos and Cambodia and in Vietnam, supporting Thai companies and investors as they explore opportunities in the market. The brokerage had already accompanied the Securities and Exchange Commission of Thailand on a visit to Cambodia in 2014, to help advise on the country’s development of its capital market. 


BEST BANK: Techcombank

Ask a credit analyst which Vietnamese bank is the best and their first response is to scoff. The fact is that lenders in the country are a long way from developing the sort of risk assessment and management of their regional peers. Even the country’s bank capital system has yet to fully transition to Basel II (a set of large banks, including Techcombank, began piloting the bank capital standard in February, with the programme to be rolled out across the sector in 2018).

In that environment, discussing the best bank has to be taken with a level of healthy scepticism. However, with this in mind FinanceAsia felt Techcombank was the standout.

It’s by no means the largest bank in the country but it does enjoy some benefits, namely the support of its minority investor HSBC. That has led to a belief that this bank takes its risk responsibilities more seriously than most, which is an important consideration seeing as Vietnam’s cyclical banking sector is going through one of its customary booms.

Every single bank that pitched for this award had a terrific year in terms of lending growth and profitability in 2015. Techombank reported customer lending growth of 39% to Vnd110.46 trillion ($4.93 billion) in 2015, while overall credit growth was nearly 30%. This helped its net profit rise by 41% to Vnd1.53 trillion. It also meant the bank’s loan-to-deposit ratio climbed from 59% in 2013 to over 70% last year. That’s not worrying – yet.

More encouragingly, the bank’s cost-to-income ratio dropped from 47.4% in 2014 to 39.5% in 2015, which is a very low ratio for a bank. And non-performing loans as a proportion of total loans fell to 1.67% from 2.38%. That’s healthy versus an industry that has average NPL ratios of 7% to 8%, according to one international credit ratings analyst.

The current expansion of bank lending in Vietnam is on the back of an improving property market and demand for retail loans and credit cards. However, the speed of growth is unnerving leading credit analysts. The Bank of Vietnam is weighing an increase in the capital to be set against risk-weighted assets from 150% to 250%. If introduced later this year, it would probably help to stem the growth of real estate loans.

Techcombank, with the assistance of its heavyweight parent, should be better placed than most to manage such a transition – or weather any financial squalls that emerge.


Vietnam’s equity and debt capital markets are miniscule compared to their more developed Asian neighbours, with the vast majority of deals that take place well under $100 million in size. Added to this there are virtually no data providers that accurately map all Vietnamese equity and bond issuance and the bookrunners or underwriters behind these deals, making comparative analysis difficult.

Still, within this market there are few true rivals against Viet Capital Securities when it comes to making deals, particularly in the equity space.

Perhaps most notably Viet Capital was responsible for the listing of Masan Resources, a mining company, on the Upcom bourse in December 2015. Following its $489 million initial public offering, Masan became by far the most liquid stock on the bourse. Viet Capital claims the stock has enjoyed good trading volumes since that time too.

Other deals include the privatisation and IPO of meat producer Vietnam Meat Industries Company (Vissan). The $64 million IPO was six times oversubscribed, making it the most demanded new listing over our awards period from a state-owned enterprise.

Viet Capital also arranged the sale of a 14% stake in Vissan to Masan Group, the third-largest food company in Vietnam, at a valuation of 94 times its price-to-equity ratio — not a bad valuation for the company.

The company had some success on the bond front too, helping Sam Kim to issue Vnd3.7 trillion in bonds in April 2015 and helping Khang Dien House do a Vnd900 billion deal in October.

All told, Viet Capital remains a powerful adviser as Vietnam’s companies slowly embrace capital markets as a funding source. It looks well set to benefit as the country’s economy slowly opens.

BEST DCM HOUSE: Techcom Securities

Like the equity market, bonds in Vietnam are far smaller than typically seen in other markets. Within this space Techcom Securities stands out.

The company was responsible for one of the largest deals conducted in the country over the past year – a Vnd3 trillion ($134 million) bond for Vingroup on February 18, according to Dealogic. This followed a similar Vnd2 trillion deal for the same company in June 2015.

Altogether, the brokerage firm raised Vnd28.8 trillion of bonds for local corporates during the second half of 2015 and the first quarter of 2016. It also conducted a Vnd8.1 trillion bond for Nui Phao Mining Company – although given that both Techcom Securities and Nui Phao are ultimately owned by the Masan Group, this could be considered a related-party mandate.

Techcom Securities says it makes far more revenue from its origination and advisory business than its rivals, with 47% of total revenues came from these services in 2015, based upon data from local provider Fiinpro.

By far the majority of Techcom’s investment banking revenues are believed to come from its debt advisory and execution; it truly is a specialist when it comes to this market. 

BEST BROKER: Saigon Securities

To judge by Saigon Securities’s (SSI) statistics it is a powerful player in the equity broking space of Vietnam.

Some investors point out that the company bears some resemblance to international investment banks, in that it has made a large sum of its revenue from proprietary trading, placing it at times in competition with its clients. But it’s hard to avoid the fact that SSI does broking very well in Vietnam.

The brokerage enjoys number one status as the most active broker across the Ho Chi Minh Stock Exchange and the Hanoi Stock Exchange. In the first quarter of 2016, for example, it enjoyed market shares of 13.96% and 11.04%, respectively. That alone makes its strength as a broker evident.

Added to this, SSI has a 40% market share for broking foreign institutional accounts in Vietnam.

Its appeal is evident; SSI employs 13 analysts and covers 62 stocks in the country, which account for 92% of the country’s market capitalisation.

SSI is forward-looking too. With the Vietnamese government taking a slowly liberalising approach to the market, it opted last year to change the rules to allow local brokerages to change their foreign ownership structures so that offshore entities could take 100% stakes. SSI was the first to take advantage, changing its own rules so that foreign companies are able to increase their ownership from 49% to 100%.

It already has a few sizeable shareholders in Japan’s Daiwa Securities (13%), locally based Dragon Capital (10%), Deutsche Bank (8%), and Van Eck Global (3%). So it will be interesting to see if one of these entities, or another, opts to take advantage of SSI’s newly liberalised ownership structure to incorporate more of the country’s leading brokerage.

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