4 SWOT

4.1 Strength

OCBC is the largest bank in Singapore by its market capitalization with highest credit rating

which means the ability to fulfill their financial commitments. Nowadays, OCBC’s business

branch out from banking to insurance, it provides all kinds of financial services.

High return on equity that reveals a corporation’s profitability compared to its competitors. Same

applies to return on assets, which is an indicator of how efficient the management to generate its

earnings by using its assets. The current share price is high as compared to industry.

4.2 Weakness

OCBC is the largest local bank in Singapore by its market capitalisation as of 2010. Whereas it is

the smallest bank on the global stage. Majority relies on the business in Singapore and Malaysia,

which compliances to the restrain development of its international market. Operating expenses

increased, mostly contributes to higher staff cost and supporting business expansion plans.

4.3 Opportunities

To its plans of expanding the business, highly chance to acquisite economies like China and

India. With more private consumption in Far East assists in the growth of retail banking and

commercial banking. Foreign direct investment in malaysia will help to develop its financial

structure and economy.

4.4 Threats

One of the most threats facing by OCBC is the uncertainty on the global stage. To focus on the

expanding, results in decrease in investments in Singapore and Malaysia will affect the

foundation of the bank. Rules and regulations varies across the world, there will be more effort

and time needed to accommodate the local business environment.

5 Business Strategy

OCBC is the second-largest banking group in Singapore by total assets. Operating banking

business as OCBC Bank, Bank OCBC NISP and Bank of Singapore in over 18 countries and

territories, and have strategic stakes in other financial services like Great Eastern for insurance,

Lion Global Investors for asset management and OCBC Securities for brokerage. Key markets

are Singapore, Malaysia, Indonesia and Greater China.

Differentiated business strategies are applied to distinguish OCBC in the market. In essence,

OCBC takes advantage of one way to differentiate themselves from competitors.

Differentiation strategy is adopted in order to spread risk. Low barriers to entry leads to

intense competition, government does not wish to have monopoly that’s the reason why

encourage competition among different banks. The business might lose its competitive edge over

certain aspects to it competitor, diversified and differentiated are inevitable to for long run of

business.

Through these financial services businesses, OCBC offers a services including deposit-taking

and personal lending, credit cards, corporate and enterprise banking, cash management,

international trade financing, investment banking, private banking, treasury, stockbroking,

insurance and asset management. Diversified and differentiated to meet customer’s needs and

wants, it reduces allocative inefficiency and wastage.

References

Corporate Strategy (2013), OCBC Annual Report, [online] Available at:

http://ocbc.com/assets/pdf/Annual%20reports/2013/OCBC%202013%20AR%20Corporate

%20Strategy.pdf

MBA Skool-Study.Learn.Share., (2015). OCBC Bank | SWOT Analysis | USP & Competitors |

BrandGuide | MBA Skool-Study.Learn.Share. [online] Available at:

http://www.mbaskool.com/brandguide/banking-and-financial-services/3142-ocbc-bank.html

Ocbc.com.sg, (2015). OCBC Bank - Strategy. [online] Available at:

http://www.ocbc.com.sg/group/who-we-are/strategy.html

Swot.advisorgate.com, (2015). OCBC Bank - SWOT analysis. Strength, Weaknesses,

Opportunities, Threats for over 40,000+ companies and industries. [online] Available at:

http://swot.advisorgate.com/swot-o/28055-swot-analysis-ocbc-bank.html