Commentary: From Piyush Gupta to Tan Su Shan, what’s next for DBS?

SINGAPORE: To paraphrase her words after DBS announced its leadership transition on Aug 7, incoming CEO Tan Su Shan is stepping into a big but different pair of shoes. She will take over from Piyush Gupta to become the first female CEO in the history of Singapore’s largest bank – and only the second woman to lead a major local bank.
A win for homegrown talent and gender diversity certainly, but her appointment must be first and foremost a strategic business decision. To get a hint of DBS’ future under Ms Tan, recent leadership transitions at global banks could provide a clue.
When Jane Fraser took over as Citigroup CEO in 2021, the bank exited consumer banking in 13 markets to concentrate on wealth management (with Singapore as one of four hubs) and institutional clients. She has also pledged to leverage artificial intelligence (AI) to enhance operations in the digital era.
Under Noel Quinn’s leadership since 2020, HSBC accelerated its pivot to Asia, with a US$6 billion investment. This large sum included plans to grow Singapore as a regional hub, improve digital capabilities and expand its wealth management business. His appointed successor, Georges Elhedery is expected to maintain its strategic focus on Asia as a continuation of the bank’s growth in the region.
The path to growth for banks is clear.
A recent McKinsey report suggested that AI could potentially unlock US$1 trillion in value globally by 2030.
Mr Gupta has already positioned DBS well during his 15-year tenure by launching a mobile-only bank in India, tapping on robo-advisers for some of its banking products and services and explored stablecoin listing and crypto staking.
These areas are not foreign to Ms Tan, who is already leading DBS’ digitalisation initiatives. Bringing this expertise to the top job will likely accelerate transformation efforts, such as integrating more AI for a personalised and distinctive customer experience.
But improved productivity and service quality are baseline expectations. DBS has the momentum to use technology to do more.
DBS can position itself as a leader in sustainable finance and expand such offerings at both consumer and corporate levels. AI can be used to enhance risk assessment, optimising investments while ensuring compliance, so DBS can increase loans to companies trying to reduce carbon emissions.
Ms Tan’s leadership offers an opportunity here to push technology to level the playing field and foster an inclusive business environment.
Research shows that human lenders often favour male borrowers. AI-driven systems could eliminate such biases, enabling merit-based lending decisions. Inspiration can be drawn from Arundhati Bhattacharya, the first woman to head the State Bank of India (SBI), who oversaw the merger of the Bharatiya Mahila Bank (BMB) into SBI during her tenure. The BMB, which was India’s first all-women bank, was established to empower women and encourage homeownership by offering lower interest rates​.
The challenge for DBS (and global banks) will be to achieve the speed and agility of fintech companies while maintaining scale, security and regulatory compliance. Implementing AI on a large scale has been difficult due to unclear strategies, rapid technological changes and weak resilience.
We have seen this in service disruptions that have plagued DBS in recent years, including the major outage in October 2023. They not only caused inconvenience but also raised questions about operational resilience and commitment to customers.
Even as global banks double down on Singapore, a local bank must also look beyond for growth. Expansion in the region and the world will likely remain a key pillar of DBS’ strategy.
It may continue strategic acquisitions to expand its footprint and customer base, as it did with Lakshmi Vilas Bank in India and ANZ’s wealth management and retail banking businesses in five Asian markets. In India, DBS has already successfully developed online banking services, benefiting the region by providing accessible and efficient financial solutions.
Given the saturated banking markets in some parts of Asia, DBS could look to expand into untapped markets like Vietnam or the Philippines, where a growing middle class and increasing demand for financial services present significant opportunities.
With expansion and continued efforts to attract wealth, there is a critical issue DBS needs to address: Customer due diligence.
DBS Group and other banks were drawn into Singapore’s largest money laundering scandal, involving S$3 billion, that first came to light in August 2023. Separately in July, DBS’ Hong Kong unit was fined US$1.28 million for violating anti-money laundering and counter-terrorist financing regulations.
These scandals have exposed weaknesses in client screening and transaction monitoring, challenging DBS’ operations and reputation. This could potentially complicate DBS’ international expansion and attract stricter regulatory scrutiny and increased operational costs. Investors might also be wary of supporting DBS’s expansion plans due to these risks.
The prosperity of DBS is inextricably related to Singapore’s economic health. It is quite simply “too big to fail”.
It is a main employer and a mainstay in the nation’s financial industry. Its global reach further strengthens Singapore’s standing as a major financial centre.
Sustaining Singapore’s competitiveness in the global financial scene requires DBS to be robust. The bank’s capacity for innovation, adaptation and expansion will ensure that the positive effects are trickled down to other industries.
This leadership transition thus has considerable significance outside the corporate world. Tan Su Shan’s deep understanding of the region, coupled with her technological expertise, will stand her and DBS in good stead.
Sumit Agarwal is the Low Tuck Kwong Distinguished Professor of Finance, Economics and Real Estate at the National University of Singapore (NUS) Business School, and the managing director of the Sustainable and Green Finance Institute at NUS. He is also the co-author of a series of books titled Kiasunomics, Kiasunomics 2 and Kiasunomics 3. The opinions expressed are those of the writer and do not represent the views and opinions of NUS.