The iFast Global Bank (IGB) should not be compared to local lenders, said Lim Chung Chun, the chief executive officer of wealth management platform iFast Corporation, at a briefing on.
IGB’s regulatory ratios are well more than both official requirements and those of the three local banks – DBS, OCBC, and UOB. Lim intends to keep iFast’s banking business “simple” compared with the local lenders.
‘Simple’ means collecting deposits, deploying the deposits in a safe and conservative manner, and earning net interest margin”, he said.
IGB’s losses have been narrowing quarter by quarter, reflecting progress. In the third quarter of this year, losses were S$820,000, down from S$1.6 million in Q2 and S$2.3 million in Q1. Revenue has also been increasing each quarter, reaching S$13.9 million in Q3 2024, up from S$11.4 million in Q2 and S$9.5 million in Q1. The bank is expected to turn profitable by Q4 this year, although Lim has not provided projections for 2025. He emphasized that a straightforward retail business with controlled pricing and margins while avoiding excessive balance sheet risks, can achieve stable profitability.
“We have been very keen to have a bank to help our overall business quite a bit “, he added.
The company will continue to build on IGB’s remittance business, as well as digital personal banking and digital transaction banking businesses, which have driven growth in deposits. As of Sep 30, deposits were S$805.6 million, up from S$358.6 million as at Dec 31, 2023.
Currently, 70 per cent of deposits come from non-UK residents, with several Asian countries contributing to the bulk of the non-UK deposits. The majority of the deposit growth is driven by new customers, who go on to open iFast accounts; this has a positive effect on the wider group, said Lim.
“We’ve been talking about a truly global business model, (where) we can operate from a few financial centres and cater to customers from different parts of the world,” he said.
IGB’s popularity has been attributed to the need many people have to open a bank account outside of their home country. Lim noted that nearly all banks are interested in serving only domestic retail customers.
“There are many people who want to open a bank account outside of their home country, and that is a segment that most banks are not putting much effort into”, he said.
Although iFast did not secure a digital bank license in Singapore, Lim remains hopeful about obtaining a banking license closer to home. Despite the challenges of acquiring such a license in Singapore due to its protected retail banking sector, the CEO believes there are still opportunities within the Republic.
“For instance, there are many private banks in Singapore. While they have a more limited banking license, they (still present an) opportunity. In time to come, we would like to look at this particular opportunity, if the Monetary Authority of Singapore gives us that chance”.