Sustainability and Banking

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Issue #107 (Jul - Aug 2019)
	Cover Story Sustainability and Banking The financial sector invariably feels the impact brought by climate change, following a deadly Camp Fire in 2018. PG&E’s bankruptcy was initiated by its failure in taking appropriate measures and precautions in relation to droughts and the risk of wildfire in California. Since then, overseas banks started to adopt green finance and climate strategies to their financing(loan)/investment processes. Hong Kong should follow suit for research shows that that corporate ESG performance is indeed correlated with their financial performance.
	Thought Leader Growing the Bank’s Business with Tech Dr Mike CHEN shares his views about how a new entrant can stand out in the financial services market in Hong Kong. Dr CHEN says Fintech drives for change in the landscape of the sector; in China Everbright Bank, they are utilizing Fintech in promoting their wealth management services in town. Dr CHEN also sheds some light on how banks can take the use of Fintech to the next level: that can be solving prevailing issues such as compliance. Dr CHEN also calls on cross-border cooperation between Hong Kong and Mainland China to bring in more opportunities for our economy.
	China World A New Era for Foreign Investment Legislation- A Commentary on China Foreign Investment Law The new Foreign Investment Law (FIL) will come into effect in 2020; the bill will simplify the administrative procedures and loosen its grip on foreign exchange control in relation to foreign firms’ investment and business in China. This would unify the regulatory regimes for both domestic and foreign investment, creating more room for cooperation and alignment in the banking industry.
	Fintech What will it take to win in the age of digital banking in Hong Kong To keep abreast with the age of digitalization, traditional banks and virtual banks are expected to broaden the selection of banking options, foster innovation and enhance customer experience in the city. This article discusses how virtual banks and traditional banks can utilise their competitive edges to stand out in the competition. It also discusses the direction to which the virtual banking is moving and potential customers’ preference.
	Knowledge Plus Customer Experience Enhancement Skills for the 21st Century Banker As finance and technology are working together to enhance the customer experience, it is vital for the banking sector to garner knowledge and understandings in relation to appropriate customer enhancement skills. Banks and universities should provide training to their staff and students on these skills; so that the banks can remain competitive and achieve high levels of customer satisfaction in future.
	GRC Corner Hong Kong’s Uncertain Path towards IBOR Transition As IBOR Transition looms near, financial institutions have to prepare for the impact of transition to risk-free rate which may prove difficult and uncertain for many market participants in Hong Kong. That is where RFRs steps in to alleviate the pressure on institutions that rely on professional evaluations in their submissions to the LIBOR and other IBORs. To effectively prepare for the discontinuation of IBORs, the UK experience can serve as a useful guide for the Hong Kong market on transition frames.