6 Key Insights from Oversea-Chinese Banking Corp Limited’s Chief Executive Officer

Oversea-Chinese Banking Corp Limited (SGX: O39) is one of the three major banks in Singapore and also counts itself as the oldest bank in the Garden City.

The bank has operations in 15 countries and counts the S$9.4 billion insurer Great Eastern Holding Limited (SGX: G07) as one of its subsidiaries.

Given OCBC’s long history and heft, there may be interesting things to learn from it.

Recently, Samuel Tsien, the bank’s chief executive officer (CEO), was featured in an interview series by bourse operator Singapore Exchange Limited (SGX: S68). I had picked out six key insights from the interview that may be useful for investors.

1. Tolerance towards mistakesclick here

2. Managing uncertaintyclick here

3. Thinking international, but not globalclick here

4. The Wing Hang effectclick here

5. Aiming for niches

“It’s tough for foreign banks like ourselves to make inroads into mass-market consumer banking in China, as our name recognition is not as strong as the local banks, and our branch network is not as comprehensive.

Higher than mass – premier, private – it’s possible. Even with that, we have to be very competitive, and our advantage is the ability to service them overseas.”

Tsien describes OCBC’s China strategy in simple terms. The Singapore bank is focusing on high-end customers as it does not have the same competitive strength for mass market banking. In line with this, OCBC’s international branch network supports the bank’s niche customer needs.

6. Growing regionally

“Knowing how to read between the lines and understanding the nuances of cross-cultural communication are vital when the bank interacts with counterparties, clients and government agencies outside its home country, he [Tsien] added.

“We need people with more regional exposure, who have a deeper understanding of different business practices and a greater tolerance towards cultural biases.””

Tsien recognises that growing regionally also requires his employees to be sensitive to cultural differences in regional countries. Banks have to deal with a wide variety of people, including clients, counter-parties and governments, all of which makes effective communication vital for success.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Chin Hui Leong doesn’t own shares in any companies mentioned.