FILE PHOTO: People use DBS automated teller machines (ATMs) in Singapore March 31, 2022. REUTERS/Caroline Chia/File Photo
SINGAPORE: The head of Singapore’s biggest lender says only about half of companies in the banking industry have made sufficient progress in transforming their businesses to embrace digitalisation and artificial intelligence (AI).
“If I have to look around the landscape, I’d say maybe 50% of companies have made enough progress on that,” Piyush Gupta told Bloomberg News in an interview last Thursday.
“A lot of people have tried to digitise before they change the fundamentals,” he added. “I call that putting lipstick on a pig.”
Gupta, who will step down as chief executive officer of DBS Group Holdings in March 2025, is widely credited for transforming South-East Asia’s biggest bank as it braces itself for new competition from fintech rivals like Grab Holdings.
That shift has helped reduce costs to win new clients, while compiling data to pave the way for AI.
In 2024, the bank added S$800mil in value from its AI usage, and that will rise to more than S$1bil in 2025, Gupta said.
Common failures at many banks have been the result of technology mistakes and corporate culture, he said from the Bloomberg office in Singapore.
DBS became one of the world’s most profitable banks under Gupta’s tenure that started in 2009 and has included an expansion in Greater China.
Its market value has risen to S$112bil as at Oct 18 and its return on equity of more than 18% surpasses many global banks.
In 2021, DBS was named the world’s best digital bank by trade publication Euromoney.
The next year, Harvard Business School published a case study on areas including its embrace of digital technology.
The transformation has not been without setbacks, and the firm was among banks in the 2000s that did not get it right, Gupta said.
DBS has suffered from a series of technology glitches and in 2023 drew penalties from the Monetary Authority of Singapore.
The chief executive takes pride in changing the culture at DBS from what it was 15 years ago, calling it his biggest achievement.
The bank today is “a little more entrepreneurial, a little bit more risk-taking, but most of all, it has got a little bit more confidence about what can be achieved”, he said.
Gupta’s deputy, Tan Su Shan, 57, who is also head of the institutional banking group, will take the top job when he retires.
Asked whether he will stay in the financial industry after stepping down, Gupta, 64, said he’s unlikely to be actively involved with DBS, nor does he plan to join other banks.
But he added: “Given the nature of Singapore, I can simply assume that they will probably involve me in something about that at some stage.” — Bloomberg
