Top financial trends for 2019 in APAC – what is noteworthy?
2018 in review, we have seen immense growth within the banking and financial industry in Asia-Pacific (APAC). From embracing new technologies to enforcing new regulations, the region has ultimately outperformed itself in the global financial market.
Moving on to 2019, top banks and financial institutions are gearing up for greater innovation and regulatory changes as the market continues to evolve with changing demands. With this, what are some of the sectors to look out for in the year ahead, and what does the talent pipeline across the industry look like?
Growing regulatory affairs and risk management market
Banks and financial institutions in APAC have gradually embraced open banking through the recent years while adopting sophisticated technologies to meet the needs of its consumers at the same time. This has given rise to an increasing need for risk management across various sectors, given the advent of financial technologies and the continuous change in corporate and government regulations.
Governments across APAC are now actively promoting the entry of technology-based firms and fintechs to introduce greater innovation and competition within the banking industry. To do so, regulatory “sandboxes” need to be in place. Australia, Hong Kong, Kuala Lumpur and Singapore are prime examples of this.
Banks in Singapore, Japan and Hong Kong are also actively looking for opportunities to partner with these non-traditional providers to increase their technology capabilities in managing potential risks while delivering new and enhanced services to their customers. This is in an aim to achieve more cost-effective regulatory compliance in areas such as financial crime and anti-money laundering (AML).
Reinforcing 2018’s goal, APAC regulators are also looking to enhance its regulations for cryptocurrency. The Monetary Authority of Singapore (MAS) is currently taking a sandbox approach whilst Japan’s Financial Services Authority is considering a complete regulatory overhaul in response to the expanding influence of crypto and fintechs.
Australian banks too, face a demanding regulatory agenda which includes an accelerated implementation of the Basel III capital and liquidity requirements. Rules on capital are much stricter, causing a greater concern for banks about the impact it has on dividends and credit growth. This is unlike Hong Kong who is already well on-track to meet the Basel III requirements.
With such a dynamic regulatory landscape across APAC, compliance to regulations remains a priority in 2019 with a focus to make regulatory systems more efficient for business strategies.
Greater emphasis on cybersecurity with advanced technology
As a result of rising external threats that may harm the sustainability of the financial industry in APAC, banks and regulators aim to enhance their cybersecurity strategies in 2019.
Hong Kong Monetary Authority introduced the Cybersecurity Fortification Initiative which includes the development of a Cyber Intelligence Sharing Platform to allow banks to share cyber threat intelligence. This is in addition to the requirement for individual banks to develop new controls and board oversight. Furthermore, Hong Kong’s Securities & Futures Commission is now looking into baseline requirements for brokers and asset managers as they were seen to be experiencing greater vulnerabilities to hacking and fraudulent activities. This 2019, banks in Hong Kong are looking into investing in cybersecurity as part of their innovation budget. This is in hopes to create a more holistic and agile process in its resilience to the evolving nature of the cyber landscape.
As financial technologies continue to integrate into Singapore’s smart city landscape, consumers are also demanding for greater speed of services including real-time payments. This demand makes it vital for banks to perform instant fraud and identity checks before payments are made. At Standard Chartered Bank for instance, systems are supported by an average of 12,000 coders and technologists and this group of talent accounts for 15% of the workforce.
As APAC’s regulators escalate the implementation of cyber controls and regulations, banks in region would need to demonstrate to local regulators that their cybersecurity programmes can even go beyond those of a global level. Banks would need to remain vigilant for cyber threats whilst sourcing for talent to grow their tech teams, especially with the chronic labour shortage in Japan. Aware of this current situation, Japan is also opening themselves up to foreign talent to support their growth.
In this regard, banks must change the way they operate which can include the adaptation of technological solutions in analysing big data to identify and potentially prevent cyberattacks. It is on a positive note that APAC is seemingly adopting new technologies much quicker than countries in Europe or the US with its desire for digital disruption.
As you might already tell, the above trends are highly dependable on the support of experienced talent. Hence in 2019, the demand for tech specialists will likely be higher than previous years.
Hiring trends in the region
Contract hiring will be embraced more than ever in Singapore, Australia and Hong Kong
Contractual jobs which were once perceived to only belong to low-paying menial work have now opened up to a range of roles within Singapore’s financial industry. Financial professionals are increasingly widening their options towards contractual roles as they see it as a potential “foot in the door” to the bank they want to work for, having witnessed their peers offered permanent roles at the end of their contract.
More people are also seen to be using contractual positions to test different banking roles before settling on their preferred function, giving more room for personal growth and achievement. On top of this, being involved in a niche role for a specific period allows the candidate to focus and hone their specialised skill within their chosen skillset.
Retaining talent with more contract conversion to perm in Japan
Adoption of tech has brought about greater operational cost-savings. This will have a positive spill-over effect on headcount budgets as teams can now afford to spend more in terms of salary packages, as well as extension of contracts and conversion of contractors to permanent employees.
However, tech talent often need to first be hired as contractual workers in order to receive such an opportunity due to the upsurge of immediate costs that can arise from bulk hiring. This has ultimately led to an uptake in the contractual jobs’ market and is an attractive time for tech specialists to join the banking sector if they are willing to undertake short stints with the foresight of conversion to permanent staff.
Is APAC still a region where talent is scarce?
Although countries like Hong Kong and Japan favour locals when it comes to hiring, which can be due to various reasons such as culture fit, they are more often than not slowly opening up to more foreign talent due to a lack of local talent. And this is even more crucial for Japan due to its rapidly shrinking population alongside a chronic labour shortage.
While various banks are finding it relatively easier to source for cybersecurity risk professionals or IT security managers, it is however a challenge to secure talents that have niche tech skillsets within the following areas:
Development Security Operations (DevSecOps)
Malware Engineering and Security Engineering
How can Huxley APAC help moving forward?
Amidst a climate of disruption towards traditional business models, it remains crucial that APAC’s workforce continues to reskill, upskill and adopt an agile mind-set in order to remain relevant for APAC's future economy. As such, the gradual incline towards contractual hiring has also started, marking a further increase in demand for tech individuals. This is a crucial period for both employers and employees alike as it affects the budget and growth of an organisation.
With a regional team and consultants in countries across APAC, Huxley is able to provide employers with up-to-date salaries that are currently paid out in the market in order to provide a competitive package to attract the best talent. Huxley is also able to advise candidates within the tech market who wish to progress or find out more about contractual roles that have great potential on what their next step should be.
If you are interested to learn more about talent landscape within the industry, do contact our relevant local office by contacting us through the form below or connect with us on Linkedin for more industry-related information.