Geopolitical tensions, trade tariffs and artificial intelligence (AI) are creating structural changes that will test the resilience of Asian banks. OCBC Group Chief Executive Officer Tan Teck Long identified these developments as major sources of uncertainty and said the group’s response was to remain focused on the capabilities and insights needed to serve customers as conditions evolve. Tan pointed to OCBC’s presence in Asia for more than 90 years and its understanding of local markets as advantages in helping customers navigate an increasingly uncertain environment. The group’s banking, wealth management and insurance businesses also provide different sources of income and access to customers with a broad range of financial needs. OCBC’s diversified franchise has helped support its financial resilience through changing economic and market conditions. Preserving that strength will require the group to adapt its businesses and capabilities without weakening the financial discipline underpinning its performance. Tan said OCBC wanted to be known as an Asian bank with the full range of capabilities needed to serve its customers. That ambition places particular importance on how effectively the group can combine regional knowledge, diversified businesses and technology to respond to changing customer needs. Regional knowledge and diversified earnings underpin resilience OCBC’s established presence across ASEAN and Greater China provides access to markets where trade, investment and wealth creation are evolving. Its regional banking operations are rooted in deep local market knowledge, while Bank of Singapore, Great Eastern and Lion Global Investors extend its capabilities into private banking, insurance and asset management. Tan emphasised the value of the group’s understanding of Asia in navigating uncertainty. He also highlighted Bank of Singapore’s specialist wealth management expertise and products as resources that could help customers respond to changing market conditions. The breadth of the franchise matters because different businesses respond differently to economic and financial conditions. Commercial and consumer banking earnings are influenced by lending activity, funding costs and credit performance, while wealth management and insurance generate income from investments, advisory services and protection products. In 2025, OCBC’s net interest income came under pressure as lower asset yields affected lending margins. Growth in non-interest income helped cushion the impact, illustrating how diversification can reduce dependence on a single source of revenue. The bank’s financial position provides an additional buffer. Its FY2025 non-performing loan ratio of 0.9% reflected relatively contained credit deterioration, while its total capital adequacy ratio of 19.4% indicated substantial capital resources. Diversification does not eliminate risk. Wealth management fees can fluctuate with financial markets and customer investment activity, while insurance earnings are affected by underwriting experience and investment performance. Credit quality can also deteriorate when economic weakness persists. OCBC’s resilience therefore depends on maintaining a balance between earnings diversification, prudent underwriting, portfolio management and capital discipline. Its regional knowledge and established customer relationships can help it respond to changing opportunities, while the durability of its financial position will continue to depend on how effectively these risks are managed. Bringing the full franchise together for customers Tan described OCBC’s diversified portfolio of businesses and income streams as a differentiating source of resilience. He identified growing wealth, trade and investment in Asia, alongside opportunities created by AI, as developments that could increase demand for the group’s services. OCBC’s broad portfolio of businesses, he said, was capable of meeting the needs of most customers. Diversification can help cushion earnings when individual businesses face pressure, while closer integration could make the same franchise more valuable to customers and strengthen the durability of their relationships with the bank. A business owner may require commercial financing, transaction banking, personal investment management and succession planning, while an affluent household may need banking, investment and insurance services as its wealth and financial needs evolve. OCBC has the businesses to address these requirements, although they operate with different commercial priorities, customer relationships and regulatory responsibilities. The group has established a Wealth Management Committee headed by Tan Teck Long and comprising Sunny Quek, Head of Global Consumer Financial Services at OCBC; Jason Moo, Chief Executive Officer of Bank of Singapore; and Greg Hingston, Group Chief Executive Officer of Great Eastern. The committee coordinates resources across the three businesses and operates under shared financial targets, providing a mechanism for aligning their commercial priorities and encouraging closer cooperation. This could help OCBC deepen existing relationships, improve customer retention and generate more recurring income by serving a greater proportion of customers’ financial needs. The financial benefits will depend on how effectively the businesses coordinate customer coverage and advisory responsibilities while maintaining appropriate standards of product suitability. OCBC’s regional presence adds another dimension. Singapore and Hong Kong serve as twin wealth management hubs, supported by banking operations across ASEAN and Greater China. This provides opportunities to serve customers whose businesses, investments and family interests extend across markets, although regulatory differences and varying customer needs increase the complexity of delivering integrated services. For OCBC, greater integration would reinforce financial resilience if it produces more durable customer relationships and sustainable earnings without adding disproportionate costs or risks. Using AI to strengthen productivity and customer service AI is another important component of OCBC’s response to structural change. Tan identified AI, digital capabilities and data as priorities for the group, while emphasising that technology should strengthen employees’ capabilities rather than replace them. He said OCBC viewed AI as a means of empowering people. The bank was seeking improvements in the efficiency of processes and day-to-day operations while also using the technology to serve customers better and strengthen its franchise. OCBC has introduced Avatar Banking, which provides customers with round-the-clock access to personalised portfolio insights and support. It also plans to recruit another 600 wealth relationship managers over the next three years. The combination indicates that OCBC is investing in technology alongside human advisory capacity rather than treating automation primarily as a means of reducing headcount. AI-enabled tools could help relationship managers retrieve information, prepare for customer interactions and handle routine enquiries more efficiently. This may allow advisers to devote more time to complex financial planning, investment discussions and relationship development. For customers, digital services can provide more frequent access to information and support between interactions with advisers. Such capabilities may become increasingly important as wealth management businesses expand and expectations for personalised service rise. Tan’s emphasis on empowering employees places the focus on how technology improves the quality and productivity of their work. The longer-term test for OCBC will be whether AI enables it to serve customers better and operate more efficiently without introducing vulnerabilities or costs that outweigh the benefits. Sustaining resilience as the business model evolves OCBC’s challenge over the next five years is to preserve the financial discipline and diversified earnings that have supported its resilience while adapting to structural changes in trade, technology and customer needs. For Tan, the bank’s regional knowledge and comprehensive financial services capabilities provide the foundation. Their continuing value will depend on whether closer integration and AI-enabled productivity strengthen customer relationships and earnings without compromising capital, asset quality or risk management.
