DB’S had acquired six financial institutions around the region. Incidentally, this was also the time When the bank has seen a change in leadership three times in a span of only three Singapore is known throughout the world as an economic powerhouse despite its small size. Likewise, its banking sector is known to be robust, well regulated and competently managed. In 1999, the government liberalized the banking sector and instituted reforms to free up entry to domestic wholesale banking, enhance competition in retail banking, and place safeguards needed for the industry.
Foreign banks could now own more than 40% to domestic banks and ere allowed to expand operations to concrete with local banks. Local banks, on the other hand, were encouraged to consolidate their businesses to meet the challenges of international competition and global expansion. DB’S played a key role in the government’s strategy to expand abroad as Singapore home market for retail banking has reached saturation. Following a series of mergers and acquisitions initiated by reforms, the country’s local banks have moved up the Asian ranking lists although still falling below their counterparts in the region.Order now
Despite regional expansion, Singapore banks minded relatively small. There is pressure, therefore, for the local banks to compete with international banks. This forced banks to scrutinize their operations to improve the bottom line. DB’S is strong in short-term banking facilities, trade financing and working capital financing. It also provides services related to investment banking, portfolio management, and custodian services. It is also known to have substantial banking presence in countries around the region, as well as offices in the US, UK and Japan.
The bank’s Objective in its acquisitions was to seek out opportunities o grow its business and broaden its reach. On the downside, however, DB’S has also been perceived to be bureaucratic and slow to respond. Being recognized as the De facto bank Of the Singapore government does not help in its image as it is not seen to be customer friendly, cold, inflexible and less innovative. Furthermore, the rapid changes in leadership in DB’S within a very short span of time has castes doubt on whether the bank can actually compete on the world stage.
Part of the major acquisitions made by DB’S was that of the Post Office Savings Bank (POSS.). POSS. was modeled after the Japanese banking yester as a convenient and friendly bank- quite the opposite portrayed by the image Of DB’S. It has even been called “the people’s bank” gaining the trust of Singapore depositors with most of them opening an account at an early age. It never discriminated customers based on the site of their hank accounts. It also rewarded loyal depositors, and the staff were always friendly, courteous and helpful.
In 1 998, POSS. then became a fully commercial after its acquisition by DB’S with the bottom being paramount. Despite initially seen as favorable move to strengthen DB’S’ market leadership, here were 3 number Of changes introduced in POSS. that did not sit quite well with the depositors. DB’S imposed a fee on accounts that feel below the minimum SOC maintaining balance, some branches were closed making it difficult for customers to travel to further-located and more crowded banks.
There was even some fears that DB’S was planning to phase out the poss. brand entirely as managers argued that it was confusing to retain both brands. Nonetheless, some argued that it would benefit DB’S to keep the POSS. brand for the following reasons: 1. DB’S can compete globally without having to sacrifice revering the local market. 2. It would not cost much for DB’S to maintain POSS. for the small account holders. 3. DB’S might stand to lose their patronage to other banks should they drop POSS., A major shift was therefore put in motion to gain back the trust of customers.
First, DB’S admitted mistakes and acknowledged that they were operating on purely logic rather than balancing it with emotion which customers were looking for in a bank. DB’S then launched “The Great Customer Experience’, an initiative that placed the customer at the forefront of its activities with the following key initiatives: l. There was a clear customer segmentation to enhance both the DB’S and POSS. brands under the “two brands, one bank” concept. A. DB’S reasserted the POSS. brand giving it a refreshed and revalidated image complete with a new branch layout and an aggressive advertising campaign. . DB’S turned Poop’s ATM and credit}debit cards into discount cards and introduced a loyalty rewards program for POSE customers. It also went back to schools, a trademark of the old POSS.. To again encourage a culture of thrift among young students. D. Other banking conveniences were introduced such as reducing customer dating time, replacing old ATM machines, installing automated cash-acceptance machines and hired specialized staff to further speed up transactions. . Investments in database marketing and customer relationship management systems were made to gather more information from customers. 3. DB’S introduced innovative products and services enhanced by partnerships through alliances and mergers. It DB’S hopes to win back the hearts of customers, it will require a well-conceived, customer-focused marketing strategy ? one that seeks to understand customers more, not just in money terms.
Looking at the strengths and weaknesses of DB’S, as well as the entire banking industry of Singapore, we can observe the following: Strengths I Weaknesses I value for money lacked personal attention and customization wide product range lacking in anticipating customers needs competitive rates vs. foreign banks slow in keeping up with channel more convenient and caring I no appreciation for CRM high quality of service high rates Of reliability, professionalism and accuracy I I DB’S must develop and implement new avenues to successfully combine its more comprehensive financial service offerings with the strong basic banking services of poss..