Market Insights Financial Banking Traditional Banks

Traditional Commercial Banking - Southeast Asia

Southeast Asia

In Southeast Asia, the Traditional Commercial Banking market market is expected to witness a significant increase in Net Interest Income.
According to projections, the Net Interest Income in this market is set to reach US$56.73bn by 2024.
Furthermore, it is anticipated that the market will display a steady annual growth rate (CAGR 2024-2029) of 3.61%, resulting in a market volume of US$67.72bn by 2029.
When compared globally, it is noteworthy that in China will generate the highest Net Interest Income in the Traditional Commercial Banking market sector.
In 2024 alone, in China is projected to generate a staggering US$1,444.0bn.
The traditional commercial banking market in Southeast Asia is experiencing a shift towards digitalization, with countries like Singapore leading the way in adopting innovative financial technologies.

Key regions: China, France, Brazil, Singapore, India

Definition:

Commercial banking refers to the financial services sector that provides a range of financial products and services to businesses, including small and large enterprises. Commercial banks offer services such as loans, lines of credit, and other financial products specifically designed for businesses. These services are critical to supporting the growth and development of businesses and the broader economy.
Commercial banks play a key role in the financial landscape by providing businesses with the funding they need to invest in new projects, hire employees, and expand their operations. They also offer a range of risk management services, such as trade financing and hedging solutions, to help businesses manage their financial risks.
The commercial banking market is highly competitive, with large global players as well as regional and local banks competing for business. Banks in this market are continually seeking ways to improve their offerings and remain competitive by leveraging technology and offering innovative financial products and services. Changes in regulations and the growing trend towards digitalization are also shaping the commercial banking market, creating opportunities for new entrants and forcing existing players to adapt.
Overall, commercial banking provides a vital range of financial services to businesses and is critical to supporting the growth and development of the broader economy.

Structure:

The market data comprises Net Interest Income, the value of Deposits, the value of Loans, Credit Card Interest Income, the number of ATMs as well as the number of Bank Branches.

Additional information:

The Banking market is highly competitive and characterized by the presence of large global players as well as regional and local banks. Banks are continually seeking ways to improve their offerings and remain competitive by leveraging technology and offering innovative financial products and services. Additionally, changes in regulations and the growing trend toward digitalization are shaping the retail and commercial banking market, creating opportunities for new entrants and forcing existing players to adapt.

Key players in this market are companies such as Industrial and Commercial Bank of China Ltd., JPMorgan Chase & Co., and HSBC Holdings.

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Analyst Opinion

In Southeast Asia, the Traditional Commercial Banking market is experiencing significant growth and development driven by various factors.

Customer preferences: Customers in Southeast Asia are increasingly seeking more personalized and convenient banking services. With the rise of digitalization and technological advancements, there is a growing demand for seamless online banking platforms and mobile applications that offer a wide range of services. This shift in customer preferences is pushing traditional commercial banks in the region to innovate and enhance their digital offerings to stay competitive.

Trends in the market: In Indonesia, the Traditional Commercial Banking market is witnessing a trend towards expanding financial inclusion initiatives to reach unbanked populations in rural areas. Banks are leveraging technology to provide banking services to underserved communities, driving growth in the market. Additionally, mergers and acquisitions are becoming more common as banks look to strengthen their market position and expand their customer base.

Local special circumstances: In Singapore, a key trend in the Traditional Commercial Banking market is the growing focus on sustainable and socially responsible banking practices. With increasing awareness of environmental and social issues, customers are demanding that banks take a more active role in promoting sustainability. This has led to the emergence of green financing products and services, as well as partnerships with sustainable businesses to support eco-friendly initiatives.

Underlying macroeconomic factors: The economic stability and growth of countries in Southeast Asia are playing a crucial role in the development of the Traditional Commercial Banking market. As the region continues to experience steady economic growth and rising incomes, there is a greater demand for banking services to support personal and business financial needs. Moreover, favorable government policies and regulatory frameworks are creating a conducive environment for banks to expand their operations and introduce innovative financial products to cater to the evolving needs of customers.

Methodology

Data coverage:

Data encompasses B2B and B2C enterprises. Figures are based on Net Interest Income, Bank Account Penetration rate, the value of Deposits, the number of depositors, the value of Loans, the number of borrowers, Credit Card Interest Income, the number of ATMs as well as the number of Bank Branches.

Modeling approach / Market size:

Market sizes are determined by a combined Top-Down and Bottom-Up approach, based on a specific rationale for each market segment. As a basis for evaluating markets, we use data provided by the IMF, World Bank and the annual reports of the top 1000 Banks by asset size. Next we use relevant key market indicators and data from country-specific associations such as GDP, deposit interest rates, lending interest rates or bank account penetration rates. This data helps us to estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. For example, the S-curve function and exponential trend smoothing are well suited to forecast financial services for digital as well as traditional products and services.

Additional Notes:

The market is updated twice per year in case market dynamics change.