OCBC turns to wealthy clients to cover compliance costs

The bank's compliance-related expenses are rising 35% annually.

OCBC CEO Samuel Tsien told Bloomberg that surging compliance costs are one factor spurring him to expand the bank's Asian wealth management business, at a time when some overseas competitors are retreating.

Tsien notes that costs of complying with anti-money laundering, tax-compliance and other regulatory requirements are rising by 35% annually across the whole bank, so these need to be spread out across as many fee-generating clients as possible.

“For us, it is very important to continue to build up the scale in this business,” Tsien said in an interview with Bloomberg this week. “Even if you have a smaller scale of wealth-management business, the extent of investment that you need to make sure that you are in compliance with all of the rules and regulation is as strong as when you have a large business. So again, scale comes in.”

Read the full report here.

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