Bank of East Asia (BEA), a 104-year-old Hong Kong bank, will move into its 1.4 billion yuan (US$209 million) southern China headquarters in Qianhai next year, which will serve as a launch pad for its expansion in the Greater Bay Area.

The 20-storey tower will house the bank's new Qianhai branch, its Greater Bay Area retail banking operation centre and innovation lab. About 500 employees will move in next year, said co-chief executive Adrian Li Man-kiu, a scion of the family that has run the bank for four generations.

"The Greater Bay Area has a huge population and its economy is growing at a much faster pace than many Western or Asian countries," Li said. "BEA's new headquarters in Qianhai, which will open next year, marks a new milestone in our bank's century of development on the mainland. This new investment signifies our commitment to the region and the nation."

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Bank of East Asia co-CEO Adrian Li. Photo: K.Y. Cheng alt=Bank of East Asia co-CEO Adrian Li. Photo: K.Y. Cheng>

Li disclosed the bank's plan for Greater Bay Area in an interview with the South China Morning Post ahead of the 25th anniversary of Hong Kong's handover on July 1.

Since the handover, BEA has expanded its mainland branch network from 11 to 70 at present, underscoring the Chinese market's importance for the Hong Kong- based lender where it competes with over 160 banks including some of the world's major banks.

BEA has over 1.3 million customers in Hong Kong and another 600,000 in the Greater Bay Area.

"The mainland business is important to BEA," said Everbright Securities International strategist Kenny Ng, pointing out that operating income from the mainland business accounted for 29 per cent of the group's total revenues and 35 per cent of its net interest income.

Ng said BEA's strategy to focus on the Greater Bay Area was spot on, as it can benefit from its tie-up with AIA China to sell investment products in the region and also from the Wealth Management Connect scheme.

BEA Tower, the Hong Kong-based lender's new headquarters in Qianhai, Shenzhen. Photo: Handout alt=BEA Tower, the Hong Kong-based lender's new headquarters in Qianhai, Shenzhen. Photo: Handout>

Since 2019, Beijing has introduced measures to link Hong Kong, Macau and nine mainland cities in Guangdong province into an integrated economic and business hub.

"We have a sizeable branch network covering all 11 cities in the Greater Bay Area, as well as a joint venture securities firm in Qianhai. We will continue to expand the range of services and products in the region," Li said.

Li, 48, is the fourth-generation scion of the family that founded BEA, the city's first Chinese-owned bank. The lender was co-founded by his great grandfather Li Koon-chun, great uncle Li Tse-fong and seven others on November 14, 1918, just three days after the end of the first world war.

His father David Li Kwok-po, 83, joined the bank in 1969 and was its chief executive from 1981 to 2109, when he handed over the reins to him and his brother Brian Li Man-bun. The brothers act as co-chief executives while their father serves as executive chairman.

"Our bank has seen a lot of changes since 1997 in terms of the technology, products and services we provide. What is unchanged over this period is the priority we place on our customers and our people," Li said.

David Li Kwok-po, chairman of Bank of East Asia, pictured in November 2018. Photo: Winson Wong alt=David Li Kwok-po, chairman of Bank of East Asia, pictured in November 2018. Photo: Winson Wong>

The company has doubled its staff in Hong Kong and the mainland from 4,100 in 1997 to 8,800 currently. And it continues its tradition of offering staff free lunch. Employees at its headquarters in Central and BEA Tower in Kwun Tong are served lunch from Monday to Friday, while the branch staff receive a food allowance.

Li, who studied law at the University of Cambridge and has master of management degree from Northwestern University in the US, worked as a lawyer for a few years before joining the bank in 2000.

He started in corporate banking for a decade, helping companies to issue bonds and get loans before being promoted to deputy chief executive in 2009 and later as co-CEO in 2019.

BEA introduced internet banking in 1999, soon after the handover, and mobile banking in 2010. Li said that digitalisation has helped the development of the city's banking sector.

"Digital banking is the way forward as it offers an enhanced customer experience. It also enables us to improve efficiency and reduce costs while protecting the environment," he said. "For example, last year alone we reduced paper use by 30 per cent."

Since the pandemic started over two years ago, as well as the Hong Kong Monetary Authority's promotion of digital banking, an increasing number of people have started using banks' mobile apps for transactions, cutting down on the need to visit branches.

HKMA data showed that 98 per cent of retail bank transfers were done digitally in the second half of last year, with only 2 per cent conducted at bank branches.

"The trend is going to continue. BEA will continue to invest and develop more data-driven technologies to provide new products and services to customers," Li said.

As customers shift to online banking, BEA has cut its branch network in Hong Kong from 98 outlets in 1997 to 56 at present, mirroring the trend seen across the industry.

However, Li said branches were an integral part of its omnichannel service platform. BEA will open a new branch at the 11 Skies commercial complex adjoining Hong Kong International Airport next year, which has been designed keeping in mind the needs of customers from the Greater Bay Area, who can receive wealth management services once the border with mainland China reopens.

"We will continue to open new branch concepts in new locations, but the design and purpose will be different," he said.

This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2022 South China Morning Post Publishers Ltd. All rights reserved.

Copyright (c) 2022. South China Morning Post Publishers Ltd. All rights reserved.