Savings banks in Asia eye cross-border services

Wichit Chaitrong

The Nation

AsiaPacific savings banks are closer to launching a crossborder money transfer service and ATM pool.

"The infrastructure already exists and what is needed is connection," Chris De Noose, managing director of the World Savings Bank Institute Asia Pacific Group, said yesterday.

Yongyuth Tariyo, president of the association, said some savings banks in the region are already doing business together.

For example, Sri Lankan workers in South Korea can send remittances to their families back home via banks, said Yongyuth, who is also deputy directorgeneral of the Government Savings Bank (GSB).

The GSB is hosting a twoday conference for the institute's members from 16 countries to explore business opportunities and exchange ideas and experiences.

Savings and retail banks in Europe are already jointly providing such services.

The institute is the global representative of savings and retail banks, with 110 members from 92 countries and combined assets worth 8 trillion Euro (Bt389 trillion) as of last year.

De Noose said no large investment was required for such financial cross-border services among members.

The group has a cost advantage in providing cheaper money transfers than existing providers such as Western Union, he said.

Financial reform was a crucial response to the global financial crisis, he said.

A pluralistic financial system, comprising savings, retail and investment banks and other financial institutions, would stabilise the global financial system, he said.

Regulators worldwide had preferred to build super financial institutions and ignored savings banks, he said.

But savings banks were mostly untouched by the financial meltdown because they did not get involved in risky financial products like investment banks did and got burned.

However, they could not escape the effects of the ensuing economic downturn, as customers could not repay loans.

For example, homeowners in Spain could not service their mortgages, leaving about 2 million apartments empty, he said.

Savings banks worldwide continue to lend to households and SMEs during the recession, he added.