Who will take the reins at DBS?

BUSINESS COMMENT

Christie Loh
deputy business editor
christie@mediacorp.com.sg

HE WAS chief executive for just nine months, but the late Mr Richard Stanley has left behind a big pair of shoes to fill.

The affable American was clearly well-liked by all who met him. On the business front, he set in motion major initiatives — which had both positive and negative effects on the DBS' image. Initiatives that will demand follow-through action from his successor.

What could make a significant difference, is whether the new CEO is promoted from within the ranks or handpicked from outside, not just the company, but the country.

In late 2007, when DBS was looking for someone to replace Mr Jackson Tai, it mounted a five-month global search. Market talk at the time centred around a few names including Mr Stanley; Mr Francis Rozario, chief of Fullerton Financial Holdings, a unit of Temasek Holdings; and Mr Mike DeNoma, who was then group executive director at Standard Chartered.

This time round, the list could be longer and more illustrious. The reason is simple: Hundreds of bankers in the United States and Europe have been displaced by the financial crisis and crackdown on bonuses. The industry's crème de la crème — not just the "second-tier" talent – is hungry for a job.

What an opportunity for DBS, which wants to enlarge its pan-Asian presence — especially in Greater China — beyond being South-east Asia's biggest bank.

But what a challenge, too. Anyone coming from outside DBS — or outside Singapore, for that matter — will have to quickly grasp why the company, which started out as the nation's bank, is quite unlike many of its peers.

The public's outrage over the soured structured products sold by the bank and the decision to axe 900 jobs at one go last year clearly showed that DBS is held to certain non-commercial, social standards. It's regarded as "the people's bank", not least because it owns POSB, the icon of low-cost banking services for Singaporeans.

Mr Stanley, who has a Singaporean wife, scored many brownie points when he admitted last year that the POSB brand had long been neglected and would be rejuvenated. Brief though his tenure was, the ex-Citibanker was proof of the ability of a foreigner from cut-throat financial circles to taste success at DBS.

But what about promoting someone from within the ranks to head the bank?

Undoubtedly, an insider would already be familiar with the corporate culture and would not need an adjustment period.

One name thrown up during the last search — and bandied about again — is Ms Jeanette Wong, who was DBS' chief financial officer before moving last October to head the institutional banking group and international operations. She has been with DBS since 2003.

Then, there is respected banking veteran Euleen Goh, who joined DBS' board as non-executive director last December. She is a member of DBS' nominating committee tasked with succession planning.

But as the board had not found an insider suitable to take up the mantle of leadership the last time, it would have to provide compelling reasons for changing its mind within a year.

DBS has said it will reveal succession plans "in due course" and analysts like CIMBGK Research head Song Seng Wun are not expecting any rush. "Now is about coping with the recession more than trying anything new," said Mr Song, who feels the news of Mr Stanley's demise is unlikely to rattle DBS stock when trading begins today.

Plus, DBS chairman Koh Boon Hwee — despite wearing many other corporate hats — has been coping well in leading the bank with senior management. "The next six to nine months is probably something that they can cope with," said Mr Song.

But economic conditions could shift in the months ahead; leaders of the United States and China, have recently spoken of signs of improvement. No business wants to miss the recovery — and running for months without a full-time CEO could prove costly.

From TODAY, Business - Monday, 13-April-2009

‘He left a deep impression’

RICHARD STANLEY

Leong Wee Keat
weekeat@mediacorp.com.sg


I found him to be very forthright, sympathetic and considerate.
Mr Lim Boon Heng,
Minister in the Prime Minister’s Office

Not just a decent person, but a business leader who ... did not forget that people are the key asset of an organisation.
NTUC Secretary-General Lim Swee Say

He’s a foreigner but was thinking very hard of Singapore’s interest.
Finance Minister Tharman Shanmugaratnam

THEY met for the first time just days after DBS’ retrenchment of 900 workers was publicly criticised by the union chief last November.

Mr Richard Stanley (picture), the bank’s chief executive, initiated the meeting with National Trades Union Congress secretary-general Lim Swee Say to discuss the layoffs.

After a “frank and open discussion” — in which both sides agreed they could not “turn back the clock” — the bank’s management and its staff union agreed to put the past behind them and committed to working closely together, said Mr Lim.

“He left behind a very deep impression,” said Mr Lim, who is also the adviser to the DBS Staff Union. “Not just a decent person, but a business leader who knew what is needed to thrive, to prosper in this competitive world, while at the same time not forgetting that people are the key asset of an organisation.”

After that meeting last November, Mr Stanley spared no effort in reaching out to the unions and workers. He attended a DBS Staff Union executive committee meeting and was peppered with questions, recalled staff union president Nora Kang. But he told her to call him “whenever they had meetings”.

Mr Stanley also joined the union for their Family Day celebrations and shared his plans for DBS with the 500 members who had gathered. His moves were “reassuring” to the union, said Ms Kang. “Even though he may be new to the labour movement, Mr Stanley was eager to know us, and treated us as business leaders,” she said.

Calling the progress “tremendous”, Mr Lim said: “The relationship between the management and union was progressing really well. But unfortunately, we could not continue the journey.”

Mr Stanley, 48, died on Saturday morning after a short battle with leukaemia. He had been diagnosed with acute myelogenous leukaemia in late January and until last week, he had been responding well to treatment.

After two rounds of chemotherapy, his doctors believed that his cancer was in remission. But his weakened immune system made him susceptible to infection, said DBS. His condition rapidly deteriorated over the last 48 hours to Saturday and he succumbed to the infection.

Yesterday, a steady stream of colleagues, friends and family members paid their last respects to a man many had known simply as “Rich”.

Ms Debbie Lau, who works in the bank’s legal department, remembers Mr Stanley as always being calm and approachable. “Even in the worst of times, he never lost his temper,” she said.

Among those who held him in high regard was Finance Minister Tharman Shanmugaratnam, who paid his respects last night.
Mr Shanmugaratnam said Mr Stanley provided feedback when the Government was devising measures for this year’s Budget, such as the Special Risk-Sharing Initiative to ensure that viable companies continue to have access to credit and keep jobs.

“Never for a moment was he looking from a single bank perspective, or from the DBS perspective,” he said.

“He was always thinking of what made sense for the country and what would help the firms ride out the crisis. I had the sense that he was sincere in really wanting to help.

“He’s a foreigner but he was thinking very hard of Singapore’s interest. And when we finally put together the plan, he was committed to want to make it work,” he added.

All DBS staff will observe one minute of silence at 2.45pm today. The cortege, carrying Mr Stanley’s body will make its way past DBS Building at Shenton Way for staff to pay their last respects, before proceeding to Church of St Teresa for the funeral service.

From TODAY, News – Monday, 13-April-2009