Is Asia the new marmite?
RBSG was one of the first banks in recent history to enter into China, through a joint venture with Bank of China to launch a credit card. At the time it was seen as yet another example of Fred Goodwin making a smart move to turn RBSG into a global player. He appeared not to be able to make a wrong move. Partnering with Bank of China allowed the Chinese to gain the credit card expertise whilst it was a low risk way of RBSG getting to understand China and the financial services market. Since the disastrous acquisition of ABN-AMRO the global aims of RBSG have been put firmly into reverse, with this one of a number of disposals by RBSG in Asia.
The RBSG announcement comes hot on the heels of Aviva announcing the sale of Asian assets so that they can focus on growing Europe.
Whilst RBSG, Aviva and Santander do not see Asia as part of their consumer strategic direction, the FS industry is showing signs of polarising on Asia. Just like marmite FS companies seem to either like it or hate it. HSBC, Standard Chartered and Prudential can’t seem to get enough of it.
Meanwhile in another component of the BRIC countries, Santander has announced its withdrawal from Russia with the disposal of its Consumer Finance business there. As the Russian banks get stronger local academic opinion is that there is less of a role for foreign banks to play. It will be interesting to see whether the likes of Barclays and Citibank follow suit.