AMID a weak global economy and volatile markets, Mahendra advises investors not to panic. “There is no need to change wealth strategies just because the economy is facing headwinds, especially if your profile is largely domestic and denominated in ringgit.”
If you are already in the game, he says, just stay in it. “You earn your wages in ringgit. You pay your debts, mortgages and credit card bills in ringgit. Therefore, many products will allow you to stay in the game. The least you should do is stay ahead of inflation, so that your money does not erode.”
But if you have ambitions beyond the ringgit, then there are instruments that will aid you in that, he adds. “We do offer people these choices. We give people the option to diversify their portfolios, be it in currencies or products. There is a place for everyone, depending on what they want out of their relationship with the bank.”
At the end of the day, Mahendra believes that each investor should find something that gives him maximum security. “For some people, he says, it could be that they want their principal protected. For others, they may want to take risks.”
Excited about the prospects
Even though Mahendra has only been at the helm for about two months, he already has big plans. He is excited about the prospects that come with being in Malaysia.
One of his priorities is to enhance the trade and investment opportunities going in and out of the country. According to SWIFTRef Data, which provides reference data services, StanChart was one of the top two banks in terms of trade last year.
“Trade represents a sizeable portion of Malaysia’s economic output, with exports of goods and services averaging more than 100% of GDP over the past 15 years. Trade corridors for Malaysia are expected to be strongest in Asia, led by China, Singapore and Japan.
“Our network advantage puts us in a strong position to facilitate trade and investment in Malaysia. We are also the only (international) bank to be present in all 10 Asean countries,” he says.
Mahendra is quite well-versed with what the younger generation wants. As a father to a millennial himself, he knows the importance of being present in the digital space. Thus, he has made it a priority to create the best digital banking experience possible for the Gen Y customers of the bank.
“Regulations, marketplaces and the habits of our customers are changing. Just like we have evolved over the last 150 years through a variety of challenges and very different times, this is yet another (change we have to face),” he says.
Malaysia, with an Internet penetration rate of 69% and 19.1 million active users, is one of the largest e-commerce marketplaces in Asean. “We are investing in better technology and standardising platforms across [the digital space],” says Mahendra.
One of StanChart’s functioning digital solutions is its mobile app, Breeze. It is available in four Asean markets, including Malaysia, on the Android and iOS platforms. “The app allows users to view balances, perform transactions and locate the nearest ATMs and branches on-the-go,” says Mahendra.
StanChart reaches out to its business clients through its Internet banking platform called Straight2Bank. “Clients have access to cash management, securities services, lending, foreign exchange, trade, supply chain finance, receivables services and document preparation,” he says.
Another area that Mahendra seeks to focus on is trade settlement in the renminbi (RMB). Since the Chinese government only began using the currency for trade settlement in July 2009, it is still considered an area of growth for banks. Malaysia was ranked No 11 in the world for RMB-denominated transactions last year, and this ranking is expected to improve.
“Our research indicates that 28% of international trade will be denominated in RMB by 2020 and we are the first international bank for RMB-clearing services in China,” Mahendra says, adding that about 10% of transactions in Malaysia, including payment volume and letters of credit, are in the Chinese currency.
As Malaysia is already a leading Islamic finance centre, Mahendra wants to focus in world-class solutions for this space. Standard Chartered Saadiq, its Islamic banking arm, is the only global bank in Malaysia to provide end-to-end Islamic financial solutions from multiple locations. This enables clients to gain exposure in other countries via the solutions that the bank provides. Mahendra cites sukuk as an example.
“Malaysia is one of the world’s largest sukuk issuers. For clients that have an interest in going the sukuk way to raise funds for their growth plan, we can show them [how these products have been applied in different markets].”
He points out that since StanChart also operates in the Middle East, where tthere is a lot of liquidity, it is in a position to tell its Malaysian clients which products within the sukuk space work and which do not.
“We are able to widen the choices because we have tested those products elsewhere.”
As the new man at the helm in challenging times, Mahendra has his work cut out for him. Nevertheless, he is ready to face the challenges head on. This attitude is also seen in his approach to deep sea fishing, a hobby he picked up not too long ago.
“The first time I did it was about three years ago. We went from zero [knowledge in fishing] to [catching] sailfish. Sailfish are those that jump out of the water with the big fins and sharp [bills like swordfish].”
Deep sea fishing requires a great deal of patience, strength and skill. In Kuala Rompin, fishermen and hobbyists spend hours at sea catching sailfish, which can travel at great speed. So, capturing one is no easy feat.
“You catch them the normal way you would catch fish. But when you hook them, they start to run for it. When they run, they really fly through the waters. You have to let the whole reel go and then bring them in. When you bring them in, they will resist. And they are really big — like 30, 40 pounds. You have to be strong in your upper body and arms. That was when I realised how unfit I was,” says Mahendra.
He struggled at first, so he turned to his mentor and good friend who helped guide him through. Soon, he began to enjoy this challenging hobby and developed the right strengths and skills for it. What his job and his hobby have in common is that they require much perseverance to be successful.
This article first appeared in Personal Wealth, The Edge Malaysia Weekly, on April 13 - 19, 2015.