In today's session,
we have a guest visitor coming in to talk from the perspective of HSBC,
Raymond, Chief Operating Officer of HSBC, here visiting with us today.
And we're going to talk a little bit about RegTech and regulation in general and
some other challenges for banking. >> Yes.
>> How important is regulation in finance?
>> To me,
the way I see the financial services,
we are basically a services, okay? >> So it's very fundamental.
[CROSSTALK] >> Very fundamental.
And we absolutely have to comply with regulations.
We have to do well, for regulations.
This is one of the top priority for us. >> Some people have said that part of
what's driving Fintech,
is these entrepreneurs don't have to comply with regulations.
And so they'll be able to get around large banks.
How do you react to that? >> There are different cases.
There are some financial services in the offer of Fintech that they
do not meet the explicit compliance of the financial services.
But I'm saying that in the place of the Fintech firm nowadays.
And they understand the importance of complying to the regulations.
They talk to the regulators often, okay?
And in the vision to understand the regulations from the regulator,
they also try to influence the regulators with a new technology,
with a new FinTech technology as well.
So I say, the whole market globally, regionally, or
in Hong Kong, are evolving and improving. >> So
some early stage entrepreneurs may be able to exploit some loopholes.
But it's pretty clear the big Fintech firms,
the big successes are financial service firms.
They are regulated like any bank and so they're facing
many of the same constraints. >> Yes, they will say, again,
I wouldn't put it as constraints.
Some people see constraints, but
some people may see that this other may be constraint but
in this other day to day things that we have to do, that we have to comply with.
And sometimes it will give us business opportunities,
as well. >> Is regulation good or
bad? >> It's hard to say that.
If you ask me, I think all the regulations that's required is good.
But the fundamental principle is very important.
>> So rethinking regulation is
a good thing periodically? >> Yes.
>> Because technology
makes new things possible, new opportunities.
So that may be- >> I agree completely.
>> Worth re-thinking.
And some of what's happening in Fintech is
regulators are having to think about, how do we deal with new technologies in
new ways? >> Yes.
>> How do we regulate a block chain?
What is it?
What is a Bitcoin? >> Yeah,
exactly. >> What is an ICO?
What are these other things?
How do we regulate it? >> And to echo your point,
the financial institution, the market,
is thinking about when using to deploy this technology.
At the same time, we can trust a regulator.
They’re using all their energy and focus to work on,
to create the right regulation, to regulate.
So that we can deploy this technology safely into the society.
>> And safely into society is kind of
a concern when we keep having bank failures.
And we keep having financial crisis, not just the 2008 one.
I mean I've lived through a multiple of these crisis of different
magnitudes and types.
And so we've got booms, bus crash problems of different types.
Some technology related, some real estate related, some lending related,
some different things.
It seems like every time we de-regulate more
bank profits go up and then we have a crisis.
>> It's hard to say that.
Honestly it's hard to say that.
From my understanding.
My will I'm engineered background. >> Right, me too.
So that makes it [CROSSTALK]. >> So my will is, given the changes in
the whole world, particularly driven by technology and Internet, okay.
The things and
scenarios get more complicated. >> Right.
>> And different.
Like in the past,
in the banking products we only have savings account and current account.
And then with time deposit, okay?
But we evolve all the way to derivative, advising services.
So the whole world is changing and I would say improving.