Date: Tuesday, 02 February 2010

Key Points

1. What deregulation means for sure: A long-term growth option for Taiwan banks
2. What deregulation will not deliver: China banking profits within the next 3 years
3. “The beef” will most likely be with the capital markets, not directly the banks
4. Deregulation, however, could release a domestic tide that lifts all boats (and banks)
5. Ultimately, deregulation is momentarily putting Taiwan back on the map: will the moment be captured?

Outline

1. What deregulation means for sure: A long-term growth option for Taiwan players

• Taiwan banks have long suffered from the “Canada Problem”
• Direct outbound investment will create the once in a century opportunity
• The growth option is in retail banking; only a few will capture it
• The inbound outcome: likely just a few and probably far in-between

2. What deregulation will not deliver: China banking profits within the next 3 years

• What’s really on offer in China – FX not RMB
• Even with no RMB limits, the problem of Taiwan player scale
• Two stories: foreign banks and Bank of East Asia
• When will the option become real? Through “plant and pounce”

3. “The beef” will most likely be with the capital markets, not directly the banks

• Real money flows are likely come into the Taiwan stock market
• Taiwan has a “Gateway to China” opportunity for global capital flows
• To capture the “real beef”  capital market reform needs acceleration

4. Deregulation, however, could release a domestic tide that lifts all boats (and banks)

• Taiwan’s second biggest banking problem: domestic confidence
• Ironically China market opening will likely re-launch domestic demand
• Domestic economy and banks could bounce from a low base phenomena

5. Ultimately, deregulation is momentarily putting Taiwan back on the map: will the moment be captured?

• The issue at stake for Taiwan is not China, it’s global competitiveness
• If Taiwan were Korea, this deregulation would be an upgrading event
• Taiwan's best form of long-term security is global inbound investment
  

About the Speaker

Mr. Gregory Gibb joined Taishin Financial Holdings in September 2006 as the Chief Operation Officer. As COO, Mr.Gibb has responsibility for driving performance across the group’s major business lines and functions.

Prior to joining Taishin, Mr.Gibb was a Director with Mckinsey & Company. At Mckinsey, Mr.Gibb oversaw the Greater China financial institutions practice, serving a broad range of domestic and international institutions. Prior to Mckinsey, Mr.Gibb worked several years with Merrill Lynch in their private client division.

Mr. Gibb is the co-author of Banking in Asia: The End of Entitlement (1999) and of Banking in Asia: Acquiring a Profit Mindset (2003), which offer a definite assessment of growth opportunities and key success factors for domestic and international banks operating across Asia.
Mr. Gibb holds a B.A. with high honors from Middlebury College, Vermont, U.S.A., where he majored in East Asian Studies. He is fluent in Mandarin.

 020210 Greg Gibb - China-Wheres the Beef (59.41 kB)