DBS Group Holdings, Southeast Asia’s biggest bank, plans to open at least eight new branches in China this year and double its workforce as it seeks to reduce its reliance on Singapore.
The bank will hire people mainly for its consumer and institutional banking services in China, according to an e-mailed statement today. DBS added three outlets this year in the Asian nation, taking the total to 19, and plans to have 50 branches and sub-branches by 2013, it said. The Singapore-based lender employs more than 1,000 people in China.
The bank aims to generate about 40% of revenue from its home market in five years, down from about two-thirds now, according to a plan unveiled in February. The Greater China region would make up 30%, DBS has said. South Asia and the rest of Southeast Asia may contribute another 30%.
“China is a very important market for DBS and surely the cornerstone for our Greater China strategy,” Peter Seah Lim Huat, chairman of DBS, said at a press conference in Shanghai today. “We expect that profitability of DBS China will continue to grow.”
DBS, which doubled profit in China to more than 250 million yuan ($47 million) last year, said the unit would become a “significant profit contributor” to the group in the next five to 10 years, Seah said.
“Even with 50 branches by 2013, it’s still very small for a country with a size like China,” said Seah. “We will spend whatever’s necessary to continue to build our foundation.”
DBS fell 0.95% to $14.66 in trading today, extending its loss over the past year to 5.7%.
China opened its banking industry to overseas companies in December 2006, sparking competition among foreign lenders for the nation’s corporate and household savings, which reached US$10 trillion in January. The country’s loan growth averaged 20% from 2006 to 2010, according to government data.
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