FX house of the year – Malaysia

Thomas Tan, CIMB’s Kuala Lumpur-based global head of treasury sales and FX, explains how the bank has responded to the call for improved efficiency and more accessible FX liquidity via such platforms as Clicks and BizChannel, and a night desk serving offshore clients

CIMB prides itself as a major regional bank serving consumers, corporates and institutions with comprehensive solutions, operating out of 229 branches in Malaysia. This network is supplemented by efficient electronic platforms, including its Clicks retail portal and Biz-
Channel for its corporate clients, both of which include seamless integration of FX product offerings. 

The bank has responded to market demand for enhanced FX liquidity with improved accessibility. Institutional offshore clients are served by a night desk, which trades until 23:00 Kuala Lumpur time, allowing corporate treasurers, asset managers and fund managers to hedge FX and trade bonds well into London hours, helping to provide liquidity during times that would otherwise be considered a blind spot, particularly when commodities start trading as European markets open. These extended service hours also help regional corporate headquarters looking to hedge ringgit exposure, dealing out of another jurisdiction on behalf of their subsidiaries. 

CIMB’s clients highly value the bank’s product capabilities, including sophisticated structured solutions such as cross-currency swaps with a tenor of up to 30 years, as well as FX options and bespoke solutions. Speed of service, comprehensive product offerings and after-sales service are also emphasised, as is the development of broader customer relationships, which go beyond treasury services to include lending, corporate bonds and even initial public offerings. The bank is particularly well positioned to help businesses looking to grow, as it also provides cash management and financing facilities to help with imports and exports – all of which benefit from having an FX strategy team on hand to advise clients on hedging and interest rate strategies. 

 

Tell us about your business.

Thomas Tan: In Malaysia, we serve all client segments, from retail to private banking, small to medium-sized enterprises, and large institutional and corporate clients. We have a very comprehensive set of FX products, and that’s our key differentiating factor. We offer one-stop coverage of all asset classes, covering FX, interest rate swaps, commodities and investments – for both conventional and sharia-compliant Islamic finance platforms. This allows us to serve our clients more holistically, as we have the in-house capabilities to provide them with the appropriate solution, whatever their needs. 

 

How has CIMB responded to volatility in the FX market?

Thomas Tan: Volatility is a double-edged sword in that it brings a lot of uncertainty to us and our clients, but it is when clients need us the most. We consider it an opportunity to differentiate ourselves by offering more structured solutions and cost-reduction structures, in addition to yield-enhancement ideas. It gives us a chance to add value, deepen relationships with our clients and offer advice or guidance in challenging times.

  

What regulatory changes have affec-ted the FX market in Malaysia, and how has CIMB adapted?

Thomas Tan: Bank Negara Malaysia has been continuously implementing progressive liberalisation for non-residents to hedge ringgit exposure. CIMB was quick to set up a seamless process to meet clients’ needs, and our continuous engagement with the central bank has also enabled us to clarify and discuss various situations further.

 

What other challenges have you faced this year, and how have they affected your clients?

Thomas Tan: The change of government in Malaysia has resulted in both new opportunities and uncertainties for domestic and foreign clients. Being on the ground, CIMB is best positioned to provide deep insight into market expectations to our non-resident clients. As well as regular interaction with clients, we have held seminars for clients to present our take on the direction the market is heading.

 

Tell us about some of your unique product offerings.

Thomas Tan: Some of our corporate clients take sharia-compliant loans or sharia-compliant trade finance, and would therefore also want their currency hedges to be sharia-compliant. The economics of the trade are the same as for conventional products. However, the underlying principles that govern the product differ in terms of settlement and documentation. Having Islamic products as part of our comprehensive suite of solutions allows us to cater to all of our clients’ needs. 

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