A common theme when Wee Ee Cheong talks about United Overseas Bank is what might be called modesty, or at least an absence of flamboyance.
“I don’t want to be loud,” he says, when talking about the bank’s expansion into other markets. “We just want to do what is the right thing for the customer. This is how we can survive in the long term.”
Wee Ee Cheong, United Overseas Bank
UOB is the Singaporean bank most closely associated with a dynasty: the Wee family. Wee Kheng Chiang founded it in 1935 to serve ethnic Hokkien clients in Singapore.
His son Wee Cho Yaw succeeded him as managing director in 1960, later becoming chairman, a role he still holds emeritus at the age of 90. Wee Ee Cheong, the third generation, succeeded his father as chief executive in 2007.
Does the family history help in taking a long-term view?
Wee stresses that UOB is a listed company not just a family dynasty: “But deep down, every time I go on a roadshow to meet some of my institutional investors… They know that the family put their money where their mouth is. We persevere. And we have a set of customers who are willing to take a longer-term view with us.”
Conservatism has some value.
“There are so many banks that have over-expanded now,” he says. “This is why Asia is attractive. We try to have a disciplined approach.”
UOB’s expansion into Asia is relatively recent, pushed forward by the bank’s merger with Overseas Union Bank (OUB) in 2001.
“Then we realized our market share in our domestic market, the concentration risk was too high,” he says. “Today our small and medium-sized enterprise market share is 35% to 40%. We asked ourselves: ‘Where is the future growth?’”
UOB is one of the banks that will benefit most if the theory that supply chains might relocate away from China because of the US trade war proves to be correct.
“This is a trend moving forward,” he says. “But it’s not obvious yet. You can’t just close a factory and come over.”
But he notes the southeast Asia platform, and particularly Vietnam, is well placed for any shift that does occur. “I am quite bullish about Vietnam.”
But today, is Singapore still the best place to allocate a dollar of capital?
“At the moment, yes it’s still Singapore because we do a lot of funding out of Singapore, a lot of expenditure and we are using it as a test bed,” says Wee. But the city state won’t dominate earnings as it once did. “Singapore is a small country to expose yourself to so much.”