According to the Business Times, UOB plans to relocate some of its back-office and middle-office operations to Malaysia, primarily Kuala Lumpur.
The strategic move is aimed at maintaining the bank’s cost-to-income ratio at 40 percent by 2026, according to the group’s chief financial officer Lee Wai-fai.
This relocation comes in line with expected growth across ASEAN and a focus on non-interest income. UOB Maintain return on equity (ROE) of approximately 14% by 2026.
Mr Lee highlighted Kuala Lumpur’s attractiveness as a talent hub and its ability to provide the high-quality workforce UOB requires.
In Singapore, a cost-conscious offshoring strategy will see the acceleration of existing initiatives such as card centre centralisation and expansion into areas such as compliance.
Lee stressed the importance of organizational restructuring and process improvements underpinned by investments in both people and technology.
UOB’s growth strategy also includes ambitions in key ASEAN markets (Indonesia, Malaysia, Thailand and Vietnam), with revenue from these markets forecast to reach 30% by 2026.
The bank expects non-interest income to account for 37% of total revenue by 2026, driven by growth in asset management, trade finance and customer treasury services.
The wholesale business is shifting focus to trade, cash management and treasury, aiming to double trade financing and increase revenue contribution from four key ASEAN markets.
The retail business, strengthened by the acquisition of Citi’s retail franchises in these markets, is expected to benefit from the region’s growing affluent population.
UOB aims to serve about 10 million retail customers in the region within the next three years, up from eight million currently.
The Citi acquisition accelerated the bank’s regional expansion plans.
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