Singapore Bank Branches & Office Space Could Become Smaller: MAS
SINGAPORE – The Monetary Authority of Singapore’s (MAS) Managing Director Ravi Menon thinks that financial institutions could slash the number of their physical branches and reduce their office space over time as the virus outbreak has accelerated the switch to digital banking, reported BloombergQuint on Wednesday morning (25 November, SGT).
“The digitalization agenda has been given a real shot in the arm by COVID-19, and some of this change is really permanent,” he told the news company.
With more people doing their bank transactions online, financial institutions will shift their focus from processing daily transactions to stuff like providing investments advisory services, said Menon, who added that face-to-face interactions will be reserved for higher-value activities and transactions.
Singapore’s central bank also announced that it will proceed with its plans to grant digital banking licenses by the end of 2020, after MAS postponed its plan to confer digital banking licenses to non-banks from June due to the COVID-19 pandemic.
Last Friday, Bloomberg reported that Mizuho Financial Group is set to cut its office footprint in Singapore and other global financial centres due to the success of working from home.
In particular, insiders shared that the Japanese bank is looking to cut 16 percent of its office premises at Asia Square Tower 2 in the heart of Singapore’s financial district. The downsizing equates to less than one floor at the 46-storey office building held by CapitaLand Commercial Trust.
Mizuho Financial Group is a major tenant there as it occupies 4 levels collectively measuring around 105,000 sq ft (9,755 sq m).
In addition, sources revealed that the Japanese lender is studying ways to make efficient use of its backup office in Changi Business Park, where it leases 200,000 sq ft (18,581 sq m).
Aside from Mizuho, Citigroup has also surrendered about 90,000 sq ft of office space at Asia Square Tower 1. Nonetheless, ecommerce giant Amazon has agreed to take over the office premises spanning 3 levels.
