Over the next six months, National Australia Bank (National) will be restructuring its operations in the Far East to refocus on competitive areas of strength, says Jeff Mitchell, general manager, Asia, based in Hong Kong. The bank is focusing in four core centres – Hong Kong, Singapore, Korea and Japan – and will expand in areas such as debt markets, derivatives and structured finance.
“To fund the expansion in these key centres, we’ve closed Taipei as part of our decision not to compete in the middle market,” says Mitchell, who adds that these clients will be serviced from Hong Kong. “We have a certain amount of capital invested in the region, which we have chosen to allocate in the most opportune places.”
In support of this view, the bank will grow its derivatives and debt markets businesses by between six and eight people across the region, while four hires will be made for a new structured finance desk in Singapore.
In Singapore, the bank has recently had its banking licence upgraded to a “qualifying offshore banking licence”, which gives it expanded Singapore dollar capabilities. Customers in Thailand and India will be covered from the South Asia hub in Singapore.
Singapore is the hub for the bank’s Asean currencies business. Mitchell says the FX group is unaffected by the changes. The bank will continue its current operations in Malaysia and will also keep offices in Indonesia and Thailand.
National is shifting the influence of some of its swaps and options trading for interest rates and currencies from Sydney to Tokyo, where the bank manages its Japanese yen, US dollar and sterling books across the time zone. However, FX options pricing will continue to be handled from Australia and London. Tokyo remains the “yen centre of excellence” for sourcing liquidity, adds Mitchell.
Mitchell notes that the group’s net profits have nearly tripled over the past two years, and showed a 100% year-on-year improvement.