KUALA LUMPUR: Asean needs to work on a banking master plan to prepare its banks to move forward in building their business in the region, said banker Datuk Seri Nazir Razak, who leads CIMB Group Holdings Bhd, the fifth largest universal banking group in Asean.
He said the Asean Banking Integration Framework (ABIF), which is still in progress, is short on details of what is being planned for Asean banks in the next decade as the Asean Economic Community (AEC) draws closer.
The ABIF aims to identify banks that can be classified as "Qualified Asean Bank" - which will enable them to expand in the region and be treated as domestic banks in the host country.
Nazir said while the framework concept paper of ABIF has been issued, "it is still short on details and I hope regulators will work together and get a clear framework on a master plan for Asean banking, so we can all prepare".
"There is no such master plan for Asean (and) many of us have gone around the region trying to build our business and grappling with the changes that are going to facilitate us in building our Asean banks."
He said when Asean first touched on AEC, the plan was to build one Asean bank but now, there are multiple Asean banks across the region because there is not "enough momentum behind the idea of creating one banking market for Asean".
He cited Bank Negara Malaysia's financial sector master plan as an example that can be emulated as it allows local banks "to look 10 years ahead and know the pace of liberalization, the central bank's expectations of us, so we align our business accordingly".
Nazir was speaking after participating as one of the panelists discussing AEC's prospects by 2015 on the second day of the Securities Commission's World Capital Markets Symposium, here, yesterday.
In the discussion, he expressed worries over the outcome of AEC's targets come 2016, as some of these targets "are not achievable".
Asean governments, he said, should set realistic targets and inform their people accordingly should the targets not benefit the overall Asean population of 600 million.
"If the people at large do not buy into Asean, then when it is implemented, there will be disappointments and push back," he said, adding that Asean is in need of good leadership, which falls in Indonesia due to its large economy.
"Indonesia is the largest economy in Asean and is incredibly capable and its companies are strong. But I understand Indonesia's position, as to be a leader, you have to lead by example."
Nazir urged Asean leaders not to take the AEC lightly and avoid discussing the challenging issues as "at the rate we are going today, we are going to find something that is different than what was presented in the AEC charter dated in 2007".
The session on AEC was moderated by CNBC Arabia bureau chief for Kuwait and Cairo, Nagwa Assran. The other panelists were BNP Paribas Investment Partners Hong Kong senior strategist Chi Lo and Thailand's former PTT Global Ltd chief executive officer Anon Sirisaengtaksin.
Lo, who spoke on China's relationship with Asean, said AEC offers a lot of opportunities for China. The Asean economy, which has the biggest pool of offshore Renminbi, will benefit and Asean has potential to amass the Chinese currency and develop its offshore business.
Anon said Thai companies are looking forward to AEC, especially in the trading of petrochemical products, as AEC will be able to develop a bigger value chain for these products.
Responding to the moderator's suggestion that AEC be postponed if Asean members are not ready for it, Nazir quipped: "If the problem in the Gulf Cooperation Countries is that they never agree on everything, here in Asean, we agree on everything but we do something else."
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