ICBC Macau was established by integrating the Macau Branch of ICBC (Macau Branch) with Seng Heng Bank (Seng Heng) in July 2009. Holding a full banking licence issued by the Monetary Authority of Macau (AMCM), ICBC Macau has 14 branches, three subsidiaries and 500 staff members in Macau. It is the biggest local bank in Macau and ranks second in terms of total assets – close to 55bn patacas ($6.8bn) – among the 27 banks in Macau. ICBC has transferred all the Macau Branch’s assets and liabilities as well as the rights and obligations of its businesses to Seng Heng. Accordingly, Seng Heng has been renamed as ICBC Macau and is 89.3 percent owned by ICBC. The integration enables ICBC to expand its scope of businesses as well as to enhance its influence and competitive edge in the market.
ICBC entered into the Macau financial market by opening its first branch in May 2003. Benefiting from the strong economic development in Macau, Macau Branch has rapidly expanded its business during the past six years. The Macau Branch has achieved double digit growth for five consecutive years in total assets, deposits, loans, non-interest income and net profit, with compounded annual growth by 82 percent, 101 percent, 99 percent, 80 percent, and 121 percent respectively. In 2009, ICBC Macau (the combined entity) has achieved a net profit of $57m, representing growth by 60 percent over the combined net profit of the Macau Branch and Seng Heng in the previous year. As the second largest bank in Macau in total assets, ICBC Macau has consolidated its market leadership and has achieved growth in assets and deposits by 28 percent and 12 percent over the respective combined figures in the previous year. The successful integration will provide a solid foundation for ICBC’s long term business development in Macau.
In the eyes of the local people, ICBC Macau does not resemble a foreign bank. Among its 500 employees, only 30 are from Mainland China, while the rest are all locals. ICBC Macau provides a wide scope of financial services, covering general banking services (such as deposits, personal cheque services, payroll services, utilities collection, payment of social security, credit cards, education loans, auto loans, and mortgage loans) and investment services (such as brokerage, investment funds, market research, and insurance).
Equally important is the localisation strategy adopted by ICBC. Mr Cheng Wing Fai, having worked at Seng Heng for 18 years and now being Deputy CEO of ICBC Macau, has been witnessing ICBC’s efforts to integrate into the local community. He remembers the period when ICBC newly acquired Seng Heng.
“Everyone was quite worried that we might not be able to adapt to the working environment when the new shareholder came. We were relieved subsequently when we found that the new management team appointed by ICBC was paying great respect to the local staff. They were willing to listen to our opinion and advice.” ICBC treasures the role played by local staff, and strives to create a mutually supportive working environment. The bank encourages its staff to contribute to the business expansion and development. “Everyone was deeply moved by this. The initial worry among the local staff gradually turned into confidence. What’s more, the staff commenced to show more passion and enthusiasm in our work,” says Mr Cheng.
Owing to the hard work of the local staff and the support from the Macau government and shareholders of Seng Heng, ICBC quickly established a foothold in Macau. Besides maintaining Seng Heng’s old customers, ICBC has fully integrated into the local community and absorbed a new group of premium clients.
After the integration, ICBC Macau has continued to improve the scope and quality of its services, invest in IT infrastructure, and strengthen its risk management.
As the largest local bank in Macau, ICBC Macau has expanded its deposit-taking business by tailoring its products for retail clients, large corporate customers, and government entities. The investments in the branch network and automated systems have improved the level of service to our customers.
ICBC has developed an advanced overseas business processing system, ‘FOVA’, for ICBC Macau’s operation. It increases the efficiency of the daily banking operations and allows the integration of ICBC Macau’s various business data into ICBC’s master system and organisation. This new platform greatly strengthens the service capabilities of ICBC Macau and assures technical advantages in customer relationship management, risk management, RMB clearing and trade settlement.
ICBC Macau has adopted an integrated risk management framework for managing its credit, market, and operational risks. With its increased businesses in Mainland China, ICBC Macau has leveraged the resources and market intelligence of ICBC to better manage the credit risk of its lending activities in China. ICBC Macau has continued to invest in technology and specialised personnel to manage the risks of its international investment activities and daily operations.
After the integration, ICBC Macau has adopted “Based in Macau, radiating out into Mainland China, expanding into the peripheral markets, and extending into Portuguese-speaking countries” as its development strategy. ICBC Macau is capitalizing on Macau’s advantage as an international financing platform, particularly for businesses in China, Portuguese-speaking countries, and resource-rich African countries. A series of successful integration activities have allowed ICBC Macau to expand its market and widen its scope of businesses substantially. Cooperation and interaction with the ICBC group provide ICBC Macau an opportunity to tap into the premium market segment in China, and enlarge its business and market coverage. In addition, it also enables ICBC Macau to receive higher customer awareness and recognition which eventually laid a good foundation for its long-term development.
To celebrate the 10th anniversary of Macau’s return to China, ICBC Macau has co-organised a credit card, tourism, and shopping promotion event with the Macau government, ICBC, and leading retail merchants in Macau. ICBC Macau invited the Peony credit card VIP customers of ICBC from all over China to participate in a three-day tourism and shopping trip in Macau. The event has attracted substantial business for the participating merchants and has received satisfactory feedback from the card customers. The bank has also established a permanent VIP service centre in Macau to serve the needs of the VIP card holders from China. ICBC Macau will continue to organize such events to help promote Macau as a tourism and shopping destination.
In developing the mainland markets, ICBC Macau has been greatly supported by it major shareholder, ICBC. The bank has been establishing cooperation opportunities in areas such as trade financing, syndicated loans, investment banking, individual pre-settlement, credit card acquiring, clearing of UnionPay business and cash management. ICBC Macau has broadened the scope of cooperation with ICBC China branches. For example, the bank has increased its lending business to Hong Kong and Macau subsidiaries of big enterprises with mainland background. This allows ICBC Macau to tap into the market segment of premium customers in China. In 2009, ICBC Macau has established close business relationship with more than 10 commercial banks in Hong Kong. ICBC Macau has been actively involved in the syndicated loans for Cheung Kong Holdings, Sun Hung Kai, China Resources Gas, Beijing Holdings, Shanghai Industries with a total loan commitment of HK$1.45bn.
ICBC Macau has expanded its business relationship with Portguese-speaking countries and resource-rich African countries to support China’s economic growth. For example, ICBC and ICBC Macau have jointly coordinated the US$1bn syndicated loan to the Standard Bank of South Africa. ICBC has successfully invited other leading banks in China as participants in the loan. The loan signifies a new era of cooperation between the Chinese banking industry and the South African banking industry, and promotes Sino-African economic and trade cooperation,
Mr Jiang Jianqing, Chairman of ICBC, said at the opening ceremony of ICBC Macau that the bank would make use of the successful integration as an opportunity to accelerate its development, deepen internal and external cooperation, improve operating performance, strengthen the regional service network and further enhance its brand image and market position in accordance with its development strategy of “being rooted in Macau, ICBC Macau will continue to extend its businesses in Mainland China, surrounding areas, and Portuguese-speaking countries.”
ICBC Macau has established a solid foundation in the local community and will continue to strengthen its efforts in infrastructure development, pillar projects, services provided for local residents and social services. The bank follows the Macau government’s overall economic strategy and continues to promote the diversification and structural adjustment of the Macau economy and to contribute to the economic development and social prosperity in the region.