In line: People use DBS automated teller machines in Singapore. The city-state’s biggest bank is having to answer questions about who will succeed Gupta, whenever he does decide to leave. — Reuters
SINGAPORE: For more than 13 years, Piyush Gupta has led one of Singapore’s most iconic institutions, the bank that helped turn the South-East Asian city-state into one of the richest countries in the world.
In his time as chief executive officer at DBS Group Holdings Ltd, Gupta has built the lender into Singapore’s largest listed company, moved early into wealth management and other key business areas, and delivered equity returns that outstrip global peers.
Now, that very success is creating an elephant in the room.
At conferences, shareholder meetings and town halls, people who watch the bank closely are quietly asking the same questions: Who’s going to replace the 63-year-old executive when his long stint ends? When will that happen? And will they be able to emulate his run?
Even after a recent series of online banking disruptions angered retail customers, industry observers said Gupta’s record is intact, and the bank’s biggest challenge is finding his successor.
“These issues should have no bearing on Piyush’s legacy, nor are they unique to DBS,” said Vikram Pandit, who was chief executive officer (CEO) of Citigroup Inc from 2007 to 2012 and overlapped with Gupta at the US bank.
“It’s always hard to imagine how a new leader can step into the shoes of a highly successful predecessor,” he said.
“But great CEOs and institutions have well-defined succession plans.”
It’s a textbook example of the phenomenon known as key-person risk, a reminder that companies must be ready for when a longtime chief departs.
And there’s much more at stake than just the share price. So integral is DBS to Singapore that how it solves the puzzle matters to the city-state as a whole.
Gupta is in many ways the Jamie Dimon of Singapore, the highest-profile banker leading the country’s largest lender and surrounded by succession speculation.
And while DBS said Gupta isn’t going anywhere, the bank has been making moves that some see as precursors to eventually passing the baton.
In February, DBS unveiled a major leadership reorganisation, ensuring the four people earmarked as internal candidates for the top post hold some of the most important jobs.
Shee Tse Koon, the then Singapore country head, took over consumer banking and wealth management, the No. 2 revenue-generator.
Han Kwee Juan, who Gupta hired from Citi in 2019, moved into Shee’s old role.
Lim Him Chuan, 54, the longest-serving of the four, relocated to Singapore to replace Han as group head of strategy and planning. The fourth, and the only woman, Tan Su Shan, kept her position running institutional banking, DBS’s crown jewel.
Tan, 55, is credited with expanding the consumer and wealth business, which accounted for about a third of pre-tax profit by the time she moved to her current job in 2019.
Shee, 53, spent more than two decades at Standard Chartered Plc in London, Dubai and as CEO for Indonesia.
Han, also 55, worked at Citi for 27 years, running businesses including treasury and markets, corporate and investment banking and cash management.
And Lim previously ran the Taiwan unit for almost five years, while also holding roles in areas including institutional banking.
People familiar with the matter said there’s no clear favourite to inherit Gupta’s 45th-floor office at the Marina Bay Financial Centre, the bank’s headquarters overlooking Singapore’s waterfront.
Hiring an outsider also can’t be ruled out, the people said, asking not to be identified discussing private information.
“A departure without a clear succession plan and new leader seen to be able to execute strongly may negatively impact the stock,” said Kevin Kwek, a former analyst at Sanford C. Bernstein who covered banks, including DBS for more than a decade.
Still, he said any selloff would be temporary because the “bench is prepared well” and Gupta “has already gotten the hardest part done”.
DBS has been preparing for Gupta’s succession for about 10 years, according to a person familiar with the matter.
The bank is looking for someone who can do things differently going into the next decade as technologies such as artificial intelligence increase in importance, the person said, asking not to be identified discussing confidential information.
“DBS has deep bench strength and is committed to grooming talent from within,” said Karen Ngui, a spokeswoman for the bank.
The February reshuffle “testifies to that,” she said. “At present, Piyush has no plans to retire, and any speculation on potential CEO candidates is thus premature.”
DBS was founded in 1968, three years after Singapore was expelled from Malaysia and became an independent country.
It was called the Development Bank of Singapore, a nod to the role it was expected to play in financing the nation’s emerging industries.
DBS went on to lead the initial public offerings of some of Singapore Inc’s iconic companies, including Singapore Airlines Ltd in 1985 and Singapore Telecommunications Ltd in 1993.
Today, it’s South-East Asia’s largest bank by assets, with about 36,000 employees in 19 markets.
And, its city-state home is also thriving. — Bloomberg
