臺灣銀行業海外分行策略角色與金融創新之探討

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(1)國立臺灣師範大學管理學院管理研究所碩士論文 Graduate Institute of Management College of Management National Taiwan Normal University Master Thesis. 台灣銀行業海外分行策略角色與金融創新之探討 The Generic Roles of Overseas Branches and Financial Innovation in Taiwan Banking Industry. 王顗婷 Wang, Yi-ting. 指導教授：康敏平博士 Advisor: Kang, Min-Ping Ph.D.. 中華民國 103 年 7 月 July, 2014.

(2) Table of Contents List of Figures…………………………………………………………………….......ii List of Tables…………………………………………………………………………iii List of Appendixes…………………………………………………………………...iv Abstract……………………………………………………………………………….1 Chapter 1: Introduction……………………………………………………………...2 1.1 Taiwanese banking industry 1.2 The features of emerging market multinational firm 1.3 Common FDI pattern 1.4 Objects of study- overseas branches Chapter 2: Theoretical Background and Propositions………………………........ 8 2.1 FSFDI location factors 2.2 Exploitation- customer relationship 2.3 Exploration- innovations in banking industry 2.3.1 The importance of financial innovation 2.3.2 The scarceness of innovation in banking industry 2.4 Generic roles of foreign branches 2.4.1 The strategic importance of local environment 2.4.1.1The roles of “strategic leader” and “black hole” Proposition 1 2.4.2 The role of “black hole” Proposition 2 Chapter 3: Research Methodology………………………………………………...21 3.1 Overseas branches location 3.2 The Generic Role Model of Bartlett and Ghoshal 3.2.1 Horizontal Axis-Competence of Local Organization 3.2.2 Vertical Axis-Strategic Importance of the Local Environment 3.3 The Evidence of Innovation 3.4 Interviews Chapter 4: Results…………………………………………………………………..29 4.1 The relationship of the roles of “strategic leader” & “black hole” and financial innovation performance 4.1.1 Interview result of Hua Nan Bank 4.2 The role “black hole” is dynamic 4.2.1 Interview result of Shanghai Commercial & Savings Bank Chapter 5: Discussion &Implication………………………………………………37 5.1 Discussion 5.2 Limitation 5.3 Contributions & Implications Reference…………………………………………………………………………….42 Appendix1~5…….......................................................................................................48. i.

(3) List of Figures Figure 2.1 Roles for overseas branches………………………………………………14 Figure 4.1 The overseas-branch profile of SCSB…………………………………….34 Figure 4.2 The overseas-branch profile of SCSB…………………………………….34. ii.

(4) List of Tables Table 3.1 Estimation of the category variables of existence time…............................22. Table 3.2 Determination of the category variables of variety of services……………23. Table 3.3 Determination of the category variables of the evaluation of the websites .25. Table 4.1 Analysis of Ten Selected Banks Oversea-branch Generic Roles and Financial Innovation Performance…………………………………….32. Table 4.2 Category variables of SCSB Hong Kong branch in different years……….35. iii.

(5) List of Appendixes Appendix 1: Ten Representative Taiwanese Banks and Overseas Branches…….....48 Appendix 2: The Index of Economic Freedom 2014………………………………..50 Appendix 3: The List of the Financial Innovation Prizes Won by the Ten Selected Banks from 2007~2012………………………………………………..51 Appendix 4: The Ten Banks’ Oversea-branch Generic Roles Profiles……………...56. iv.

(6) ABSTRACT Bankers who set up their overseas branches would either try to exploit the local market by replicating their successful experience, or explore the local market by learning the new business or finding the new customers’ needs. The latter could help a bank with financial innovation and bring more opportunities back to home country and be beneficial to the future growth. Through identifying the generic roles of the overseas branches, the bankers could develop the most suitable strategies for their overseas branches. Our propositions are supported through the analysis of the overseas-branching strategies of the ten selected Taiwanese banks, 68 overseas branches.. Keywords: overseas branch, innovation, market exploration, banking industry. 一般銀行業者設立海外分行後的經營策略有 (1)複製自身成功經驗，繼續經營現有客戶，或是(2)在新市場中探索新事業或新的客戶需求。選擇上述後者策略可以幫助銀行業者取得金融創新，並帶新機會回母國總行，進而成就未來發展。透過分析台灣銀行業者的海外分行策略角色，銀行業者可以發展出最適合的海外經營策略。本研究論點藉由分析台灣銀行業十家銀行的 68 間海外分行策略角色與經營策略以得證。. 關鍵字：海外分行、創新、市場探索、銀行業. 1.

(7) Chapter 1: Introduction 1.1Taiwanese banking industry Taiwanese banking industry is facing development obstacles. McKinsey & Company (2004) once pointed out the optimum number of banks in Taiwan is ten. However, so far, there are 39 Taiwanese banks and 30 foreign banks in Taiwan. Taiwan's GDP is about 490 billion; therefore, “overbanking” is a general phenomenon in Taiwan. Due to the impacts of overbanking and the financial crisis, the GDP ratio of financial industry declined from 7.28% of 2004 to 6.51% of 2012. Besides, the over competition of the banks in Asia is also an obstacle for the banks in Taiwan from having wider interest spreads of loans and deposits.. There is still room for Taiwanese banking industry to improve in order to become more competitive than the other Asian nations. In GCI--The Global Competitiveness Index, Taiwan is ranked 24th in the financial market development, while Singapore is ranked first, and Hong Kong is ranked second. Overall, there are three major disadvantages of Taiwanese bank system, which are:. (1) Conservative authorities:. Because banking industry is closely relative to public benefit, the management of the local relative authorities tends to be more prudent and conservative. Despite trying to be more open in recent years, Taiwan’s banking industry comparing to international bankers is still lacking significant breakthroughs.. (2) Lack of financial innovation:. 2.

(8) Due to the confined operating environment, the financial products and services are short of differentiations. Furthermore, this situation results in price competition, which blocks the development of profit gaining in Taiwan banking industry.. (3) Smaller financial scale:. The number of financial institutions in Taiwan is so much that the resources are dispersed when sharing out among banks. To be worse, the development of internationalization of Taiwanese banking industry is still inadequate; hence, it is hard to compete with the other international bankers.. As a result, the bankers in Taiwan tend to expend their overseas markets by setting up overseas branches in order to overcome the preceding problems.. 1.2 The features of emerging market multinational firm To view MSCI (Morgan Stanley Capital International) index, Taiwan is one of the emerging countries, but differentiate with the other emerging countries in the world. Unlike China or the BRICs, Taiwan is not an emerging market with big inner market. The supply is always larger than the demand. Therefore, instead of developing inner emerging market like China and the BRICs, Taiwan prefers to expand overseas markets by becoming emerging market multinational firms. Emerging market multinational firms (EMMs) are referred to those which have headquarters in emerging countries, but their operating units are scattered in more than one country (Agtmael, 2007). According to Accenture plc., there are three outstanding advantages of EMMs: 3.

(9) (1) Although their structure is not yet mature, they are able to deal with dimensional risks, for they usually set up bolder, long-term expansion strategy. (2) EMMs are good at turning the inferior conditions into their opportunities, for they are more flexible and more innovative. (3) EMMs emphasize the importance of localization.. Therefore, Taiwan banking industry, as one of the EMMs, now seizes the chance and starts to expand overseas. Nowadays, outward foreign direct investment (FDI) by financial service industries grows with a soaring percentage. The total Taiwanese outward FDI grew from 25 percent in 1994 to 50 percent in 2006 (Huang, 2010). Thus, from 1991 to 2006, the number of overseas affiliates of Taiwanese bank increased almost seven times from about 35 to 219 overseas affiliates.. 1.3 Common FDI strategy choices FDI consists of financial sector FDI (FSFDI) and non-financial sector FDI (non-FSFDI), and usually people take FSFDI as the narrow sense of banking industry sector FDI (Xiang and Wang, 2007).. Although most of the financial institutions can offer complete services to those multinationals firms, some scholars found that sometimes, the commerce banks in home country need to maintain present market share and clients source by performing FSFDI (Aliber, 1984). Therefore, it’s common to see in recent decade, the Taiwanese 4.

(10) bankers are eager to enter the emerging markets in South-Eastern Asia or China by setting branches there. That’s because bankers tend to set foreign affiliates, branches or subsidiaries, before or after their customers (Tschoegal, 2002).. Furthermore, the most important clients of Taiwanese banks, the information technology (IT) multinational enterprises (MNEs), have expanded aggressively overseas in South-Eastern Asia recently (Huang, 2010). The main reasons of setting overseas branches in South-Eastern Asia are not only to follow the customers but also to look forward to the prosperity of ASEAN (Liu, 1997).. However, for those countries, such as Vietnam, Myanmar or Thailand, so far are still lacking of the needs of sophisticated financial products or loans with greater scopes. Thus, the strategic importance of those countries compare to the other developed countries is ranked low. That is to say, if a banker only chooses the emerging markets to set overseas branches, it is less likely to have the possibility of product and service innovation for the organization.. On the other hand, there is another choice of FDI strategy. Many of the bankers choose to set overseas branches in Hong Kong, Singapore, these Asian financial centers. Furthermore, some of the state-owned banks, like Hua Nan Bank and Mega International Commercial Bank, set overseas branches in New York and London, these international financial centers.. Therefore, the research question of this study is to observe Taiwanese bankers’ FSFDI location and strategy choice in order to discover the other possible strategy choices. If the overseas branches are set to provide service to their existed FDI clients, then why would some of the bankers choose to set their branches in those 5.

(11) international financial centers, such as Hong Kong, London and New York? In addition, although the financial centers are strategically important, does every overseas branch set in financial center play the same strategic role?. 1.4 Objects of study- overseas branches As long as Taiwanese bankers receive the permission of both Taiwan government and the host country, they are allowed to set up overseas affiliates in the host country. Affiliates include subsidiaries, representative offices and branches. Among these three types of affiliates, we choose the overseas branches as the objects of the research, and the reasons are as following:. Overseas subsidiaries are under the control of the host country government, and directly compete with local commercial bankers while maintain indifferent legal entities (Huang, 2010). However, the foreign subsidiaries might be set up by joint venture, or by the other strategic-alliance ways, which is complex, and comparatively rare in Taiwanese banking industry. Furthermore, usually, the headquarters of the bank in Taiwan might not maintain the power of control on the subsidiaries.. Representative offices, considered as the first move of international expansion, are used mainly for investigative purposes. Hence, these representative offices are not permitted to operate any banking functions.. Therefore, in this research, we put more focus on overseas branches. Due to overseas branches are supported directly by headquarters of the banks, and also these overseas branches are subject to perform deposits and to issue loans. The headquarters’ 6.

(12) decisions and strategies would either directly or indirectly influence the generic roles of the overseas branches, and vice versa.. With specific objects and motivation of the research, in the remaining parts, we are going to examine the existed strategic choices of overseas-branching of Taiwanese banks. We have chosen ten sample banks in Taiwan which has at least one overseas branch, and the branch has been set up for at least three years. Then we analyzed those selected banks with empirical model and face-to-face interviews. Therefore, in Chapter 2, after reviewing the former related researches, we propose the propositions about the generic roles of the overseas branches and the relationship with innovation performance. In Chapter 3, there is an introduction of the determinants and procedures of creating the empirical model and cross-examination of the innovation evidences. Then we find the general pattern of their strategies, and use the interview results to clarify our findings. The last sections would be result, discussion, conclusion and implication.. 7.

(13) Chapter 2: Theoretical Background & Propositions In this chapter, we are going to review the literatures and to explore the relationship of the strategic roles of overseas branches and their financial innovation performance. In the first section, we discussed about the current oversea-branching location and strategy choice factors of Taiwanese banking industry, which includes exploitation and exploration, two different strategies. And we discuss how the innovation happens in these two strategies. In the second section, we reframe the generic roles of Taiwanese overseas branches with Bartlett and Ghoshal’s theory model. There are four different roles of overseas branch in Bartlett and Ghoshal’s theory model. Furthermore, we would illustrate which roles are most likely to adopt innovations. Moreover, we try to examine whether the strategic roles of overseas branches would change with time.. 2.1 FSFDI location factors To set up “representatives” or “branches” in host country is called “greenfield investment”. In Repullo’s research (2000), in host countries with higher risk but looser deposit regulation, multinational banks prefer to set up “branches”, for overseas branches can directly use the capital and the brand name of its headquarters. Through setting up overseas branches in host country and developing businesses and investment, the ability of profit earning is enhanced. In the following, we are going to introduce what the common factors that influence the location choice of FSFDI are.. 8.

(14) The first two crucial factors that attract FSFDI are the financial development status and the host country’s potential of economic growth (Focarelli & Pozzolo, 2001). It is more likely to attract FSFDI if in the host country: (1) the average operating cost of financial institutes is high, (2) interest spread of lending and deposit is narrow, and (3) capital efficiency is low. Since it is comparatively profitable for foreign bankers to operate M&A in the host country, and furthermore, they could expand its market share after entering the host country (Xiang & Wang, 2007). On the other hand, according to Brealey and Kaplanis (1996), in consider of the potential of profit growth, multinational banks also tend to invest in those host counties with higher GDP.. Another factor is the “distance” between the host country and the home country. Both “physical” and “psychological” distances are in considered, for instance, common languages, similar management systems or familiar cultures. Roberts and Arnander (2001) found that American bankers set up branches in London during 1950s to 1960s because of language and culture similarity.. Furthermore, Focarelli and Pozzolo (2005) claimed that strictly regulated banking system make foreign banks less accessible to the host country; hence, reducing the probability of entry. Nigh et al. (1986), Hultman and McGee (1989), and Forecarelli and Pozzolo (2005) also argued that deregulation of the host country bolsters up positive impact on foreign banks FSFDI willingness.. However, out of surprise, FSFDI is unlike the non-financial FSI which put great emphasis on host countries’ labor cost especially for foreign manufacturing firms. When it comes to FSFDI, Shen, Liang and Hao (2009) indicated that the cost of labor is not an important factor for deciding foreign bankers’ entry. 9.

(15) In summary, the location factors that affect the willingness of FSFDI include: (1) the financial development status, (2) the host country’s potential of economic growth, (3) the “distance” between the host country and the home country, and (4) the regulation in the host country. Those are the factors that assumed by most of the researchers. Follow up, we would explain how Taiwanese bankers operate the common strategies of exploitation and exploration for the overseas branches.. 2.2 Exploitation- customer relationship Taiwanese banks may make use of existing client relationships and keep providing financial services for Taiwanese FDI firms, including production financing (funding for material purchase, funding for turnover), trading financing, and consumption financing (deposits, remittance, or wealth management) (Miller et al., 1998). Setting up overseas affiliates is one way to maintain specific customer information and enhance internationalized competitiveness (Hymer, 1976). In addition, bankers sometime. receive. commercial. intelligence. from. their. long-term. customer. relationships (Gray and Gray, 1981).. As a matter of fact, bankers assume great risk when making transaction (withdrawals) with clients. Bad debt might cost a bank a great deal of loss. Hence, banker needs to investigate client’s credit before making any withdrawal. This investigation is costly, especially for new clients. That is to say, the banks in the host country would ask for higher interest rate to those foreign firms building overseas subsidiaries in order to reflect the cost of credit investigation, thus increasing funding costs for those foreign firms. As a result, those Taiwanese firms prefer to borrow 10.

(16) money from Taiwanese banks. Local (Taiwanese) banks transferring existing client information to their overseas affiliates can decrease credit risk, provide lower interest rates for clients, and build up deeper the relationship between existing clients and the banks (Kogut & Zander, 1993; Almeida, Song & Grant, 2002).. To sum up, bankers follow their existing clients because of the following three reasons (Aliber, 1984):. (1) The service or the financial condition of banks in the host country is bad. (2) The bank service in the host country is insufficient. (3) The bank in home country is rather competitive and internationalize well.. 2.3 Exploration- innovations in banking industry 2.3.1 The importance of financial innovation. Innovation is the critical factor to economic competitiveness; hence, there are more and more emerging markets encourage their countries to take “innovation” as their core strategy (Huang, 2009). The purpose of exploring the new environment is to gain the new resource that could be helpful for the long term growth. According to Barney’s resource based theory (1980) and Porter’s sustained competitive advantage theory (1980), they both agree with finding resources that is competitive or fitting the VRIO attributes (Barney, 1980): valuable, rare, imitable and organization. These kinds of resources are the key points to speed up a company’s growth whenever the growth is slow down.. 11.

(17) 2.3.2 The scarceness of innovation in banking industry. Reidenbach and Grubbs (1987) once conducted a survey about the innovation activities of banking industry. The research found that banks adopt innovation, but they are much less than manufacturers or the other service industries. The main reason is because banks don’t take innovation as the elements for development, and they don’t use systematical method to organize innovation activities. Nevertheless, they found banks adopting innovation have better performance than the other banks not adopting innovation. The quantity and level of demand to financial services in real economy are enlarging and improving in a fast pace; therefore, financial innovation is in need and that’s also how to bring the market into a brand-new period. (Lu & Qiao, 2008). However, not every headquarters would initially adopt the innovation found by their overseas branches unless they find that the other bankers are doing so. That’s what Barden wrote: “innovation adoptions by other corporately related subsidiaries increase the likelihood that a subsidiary will subsequently adopt the innovation”, especially when it comes to the most prudent industry (Barden, 2012). In the research, Innovation in Multinational Subsidiaries, Phene and Almeida (2008) suggest that: “subsidiary innovation depends both on the knowledge it is able to acquire from external sources and on subsidiary capabilities to absorb and utilize this knowledge”. Firms may observe and learn overseas advanced technology and management knowledge through cross-border networking (Dunning, 1998).. Above all from 2.1 to 2.3 are the existed location factors and common strategies for overseas-branching. So far, those common strategic roles of overseas branches are decided according to different features of the locations. That is to say, the location of 12.

(18) the branch would determine its strategy. However, to focus only on the location is not enough, for it fails to notice that the competence of the overseas branch could also influence the position of the overseas branch. For instance, the overseas branches in the financial center but with different competences would result in playing different strategic roles. Furthermore, the locations might imply some other strategic meanings that cannot be only distinguish by whether there are Taiwanese FDI firms or not. Therefore, we decide to reframe the generic roles of Taiwan overseas branches with the theory model of Bartlett & Ghoshal (1986).. 13.

(19) 2.4 Generic roles of foreign branches Traditionally, the roles of subsidiary in host countries were based on their capability to maintain and manage the local operations while dealing their relationship with headquarters (Brien, Scott and Gibbons, 2013). The theory of Bartlett and Ghoshal (1986) is one of the examples with some modifications. To see Bartlett and Ghoshal (1986), in Tap Your Subsidiaries for Global Reach, there are different generic roles of foreign subsidiaries or branches for banks. The four roles, which are “strategic leader”, “contributor”, “implementer” and “black hole”, are decided by the competence of the local organization and the strategic importance of local environment.. Figure 2.1 Roles for overseas branches. Source: Bartlett and Ghoshal (1986). Follow up Bartlett and Ghoshal, there are more researchers discuss the importance of strategic roles of subsidiaries and build linkage with other issues. Gupta and Govindarajan (1991, 1994) have developed a study discussing the relationship of the strategic roles of subsidiaries and organizational knowledge. Based on the pattern 14.

(20) of knowledge flows, subsidiary roles then can be classified into four categories: (1) global innovator (high outflow, low inflow), (2) integrated player (high outflow, high inflow), (3) implementer (low outflow, high inflow), and (4) local innovator (low outflow, low inflow). Moreover, there is a study which re-conceptualized Bartlett and Ghoshal’s strategic roles of subsidiaries in MNEs with resource bundling perspective (Rugman, Verbeke and Yuan, 2011). Another conceptual study about the implication of Bartlett and Ghoshal’s strategic roles typology is a study discussing cultural environment and subsidiary’s resources and capabilities have effects on the strategic context of subsidiary (Qin, Ramburuth and Wang, 2011). Although there are many studies about “subsidiary roles”, most of them focus on the autonomy of the subsidiary. Few of them mentioned how could a subsidiary adopt innovation and bring the ideas back to headquarters in order to improve the innovation performance of headquarters.. Although there is difference between subsidiary and oversea branch, the Taiwanese banking industry, as one of an emerging market, is lacking the ability to set overseas subsidiary yet. However, the Taiwanese bankers are only capable of setting oversea branches as their first step of overseas expenditure. After the overseas banking of Taiwanese banking industry is getting mature, there is more likely for them to set subsidiaries. Thus, this research would adopt the typology of Bartlett and Ghoshal and apply it in banking industries’ overseas branches. Moreover, by considering the difference of “branch” and “subsidiary”, which is that “branch” compared with “subsidiary” would have more linkages with the headquarters, this research is to discover if the overseas branches in certain kinds of strategic roles would be able to adopt more innovations in the local market, and bring the ideas back to headquarters in order to improve the innovation performance of entire bank. 15.

(21) 2.4.1 The strategic importance of local environment. The strategic importance of local environment depends on the company’s global strategy and the significance of the chosen country’s national environment (Bartlett and Ghoshal, 1986). Therefore, the importance could be determined by whether it’s a big market, whether it is a rival’s home market, or whether it is a technology advanced country (Bartlett and Ghoshal, 1986). Furthermore, some researchers argue that local environment could be a knowledge pool; subsidiaries or branches can draw or contribute to the local environment (Almeida, 1996; Kummerle, 1997; Almeida, 1999; Frost et al., 2002; Phene and Almeida, 2003).In the case of banking industry, whether the place is a financial center could be one of the factors that decide the strategic importance of local environment.. 2.4.1.1The roles of “strategic leader” and “black hole”. Among all, “strategic leader” and “black hole” are the two roles that both be set in strategically important environment. However, they are two different roles. Base on Bartlett and Ghoshal, “strategic leader” is highly competent. “Strategic leader” not only serves as a sensor for detecting innovation but also help to analyze the threats and opportunities in order to develop appropriate responses (Bartlett and Ghoshal, 1986). “Strategic leader” is like a subsidiary or branch with large amount of resource and knowledge flow that taken in the local environment (Gupta and Govindarajan, 1991), and also with high resource or knowledge inflow and outflow (Birkinshaw and Morrison, 1995).. 16.

(22) On the other hand, “black hole” plays a totally different role. According to Bartlett and Ghoshal, “black hole’s objective is not to manage it but to manage one’s way out”. For instance, Philips in Japan, Ericsson in United States, and Matsushita in Germany are in roles of “black holes”, for those places are too competitive and expensive (Bartlett and Ghoshal, 1986). However, they are able to ensure and keep the companies’ global positions. The objective of “black hole” is to exploit its learning potential even if the local business potential is unreachable. Through observing the environment and sending the feedback to headquarters, the headquarters will digest and come up with useful ideas, or at least prevent the degradation of the global position of the company (Bartlett and Ghoshal, 1986).. To sum up, the roles of “strategic leader” and “black hole” compare to the other two roles, tend to have better possibility to adopt innovations in the local market. Although they are competently different, they are set in a strategically important environment. Therefore, they are able to sense and observe the environment, and send back the information to headquarters and be beneficial to innovation adoption. By adopting the idea into Taiwan banking industry, we propose the following:. Proposition 1: The Taiwanese overseas branches in the roles of “strategic leaders” or “black holes” are positively related to financial innovation adoption of the Taiwanese banks.. 2.4.2 The role of “black hole” is dynamic. In the theory of Bartlett and Ghoshal, they emphasize the present status of the. 17.

(23) company’s overseas subsidiaries or branches. The generic role model of Bartlett and Ghoshal seems to be static. However, in fact, if the competence of an overseas branch has been improved, the role of the overseas branch would change accordingly. The roles could be dynamic.. Therefore, although the role of “black hole” might make the branch lose at the first few years for not being competitive enough, and be considered as less fruitful strategy to the company (Bartlett and Ghoshal, 1986). The main reason for setting “black hole” is to learn and explore the new environment and to grow in the following years. According to Bartlett and Ghoshal (1986), the status of an overseas branch in role of “black hole” is called “window status”, for the branch is not capable of competing with the other local firms. Therefore, the first step is to observe and accumulate its competence. Next step is to get into the blood stream of the local market and struggle for the market share. The task of the branch would later change from observation to winning the market share. However, the branch should only select and focus on the areas that are competitive and better than the other local firms (Bartlett and Ghoshal, 1986).. To see the case in banking industry, if a “black-hole” branch wants to improve its competence and manage way out of “black hole”, the premise is the attitude of the headquarters. Even the more individualized “subsidiary” would be controlled by headquarters to a contributing unit and often could only have limited range of strategic options in management (Taggart, 1998), not to mention the “overseas branch”. Some state-owned banks set lots of oversea branches in roles of “black holes” but are reluctant to improve the branches. Namely, only if the headquarters allow their branch to adopt improvement, the “black-hole” branch could possible to change its. 18.

(24) status.. The strategic role shift happens in relative to the three factors: (1) headquarters assignment, (2) subsidiaries’ or branches’ strategic resources, and (3) local environment (Birkinshaw, Hood and Jonsson, 1998). Furthermore, according to Zhang & Chen (2006), combining the factors of competence, resource and environment, firm growths could happen in a dynamic surrounding through spanning or interaction with others. Moreover, there are researchers also argue that the overseas subsidiaries or branches improve their competence by learning not only from themselves but also from others, like: customers, suppliers, or rivals (Lai and Weng, 2012). That is to say, an overseas branch in role of “black hole” despite less competent, there are opportunities in the environment, and through dynamic and flexible interaction, black-hole branch would grow and improve its competence. After the overseas branch has improved its competence, the “black hole” could gradually become “strategic leader” on the theory model of Bartlett and Ghoshal. Thus, we propose the following:. Proposition 2: Taiwanese Bankers who set “black holes” in those strategically important environments are to gain access to innovations, and after improving its ability, “black holes” would gradually turn into “strategic leaders”.. 19.

(25) Conceptual Framework Exploitation – follow the customer. Discuss the current oversea-branching location and strategy choice factors of Taiwanese banking industry. Exploration – mostly choose Hong Kong and Singapore for lower risk Horizontal Axis-Competence of Local Organization: Proxies: 1. Branch’s age. Reframe the generic roles of Taiwanese overseas branches with Bartlett and Ghoshal’s theory model. 2. Variety of services 3. ROE and ROA 4. Websites of overseas branches. Vertical Axis-Strategic Importance of the Local Environment: the Index of Economic Freedom 2014. Compose the graphs of banks profiles. Prove the roles are dynamic by interview. Cross-examine with the evidence of innovation. The example of Shanghai Commercial & Saving Bank. The number of “Black. The number of “Black hole”. hole” and “Strategic leader” is positively relative to innovation performance for. and “Strategic leader” is not positively relative to innovation performance for state-owned banks. privately owned banks. Interview The example of Hua Nan Bank. Prop. 1. 20. Prop. 2.

(26) 3. RESEARCH METHODOLOGY This research adopts the analytical approach, and it contains three parts. First part is to redesign Bartlett and Ghoshal’s model with selected proxies that serve as the measurement of competence of branches and strategic importance of local environment. Through analyzing the overseas branches of ten selected banks in Taiwan, we could get ten graphs indicating the roles of the oversea branches of each bank. The second part is to cross examine with innovation prizes which are serve as the evidence of innovation. So far, we are using secondary data to organize our findings. The third part is to conduct face-to-face interviews with two differentiated banks, and use the first-hand interview details to explain the propositions and the results of the graphs of certain banks.. 3.1 The Generic Role Model of Bartlett and Ghoshal To prove our propositions, we have to identify the generic roles of each overseas branch from each bank in the generic role model of Bartlett and Ghoshal (1986). Therefore, we select ten representative Taiwanese banks. Furthermore, in order to determine the position of each overseas branch of these representative Taiwanese banks, we need to redesign the horizontal axis and the vertical axis of the model.. 3.1.1 Horizontal Axis-Competence of Local Organization. For the horizontal axis, competence of local organization, we select four different proxies, which are the data of the existence time of each banks’ overseas. 21.

(27) branches, the services offered by each overseas branches, the ROA and ROE of the bank within the six years to see their headquarters’ capacity of supporting, and also the evaluation of the websites of the oversea branches. Next step is to combine these three indicators and to quantify their scores.. a. Branch’s age. Firms would have better performance with time, for aging firms would be able to observe and gradually improve their level of productivity, profits, firm size, debt ratios and equity ratios (Coada, Segarra and Teruelb, 2010). Therefore, we suppose that the branches with older age would be able to improve their performance by observing the environment and competitors and attract more clients in order to become more competitive than those recently found branches. With the category variables, we ranked the branches’ age from 1to 4.. Table 3.1 Estimation of the category variables of existence time. time of existence. category variable. 0 ~10 years. 1. 11~20 years. 2. 20~30 years. 3. 31~. 4. years. Source: This research designed.. 22.

(28) b. Variety of services. The second indicator is the variety of services offered by each bank. Wan (2011) found that service and product variety have positive relation with the company performance. As a result, we suppose that branches with more services or products offered would be more likely to attract customers with different needs, and turned out to have better operating performance. That is to say, they could be more competitive than their rivals. However, each overseas branch might receive different licenses. Some are retail branch, while some are whole-sale branch. The licenses also influence their product category. Therefore, we design the category variables like the following chart:. Table 3.2 Determination of the category variables of variety of services. Retail Branch. Whole-sale Branch. (with deposit). (without deposit). variety of. category. variety of. category. products/services. variable. products/services. variable. only basic services. 1. with only few. 1. products and services (no more than 5 kinds) With more than 15. 2. With medium, around. products and. 5 ~10 kinds of. service. products and services. with wealth management. 3. more than 10 kinds of products and services 23. 2. 3.

(29) service or without wealth management but products and services are more than 20 kinds 4. with wealth management. and. plus more than 20. with more than 15. 4. kinds of products and services. kinds of service Source: This research designed.. c. ROE and ROA. The third proxy indicator for setting my horizontal axis is the ROE (return on equity) and ROA (return on asset) of the banks. It has been widely used in many financial literatures, for ROE (return on equity) and ROA (return on asset) are the appropriate measurement of banks’ financial performance and how to utilize their resources to earn returns (Hitt et al., 1997 & Verreynne, 2006). Because to run an overseas branch is money consuming in many ways, not every headquarters would choose to be financially supportive all the time. By knowing their ROE and ROA performance, I could infer that the ability and possibility for the headquarters of the banks to support their overseas branches. We use the citatory variables to describe each bank’s performance on ROE and ROA. 24.

(30) d. The website of the overseas branch. Since the online banking is getting more and more important recently. People would rely on the information on the website of the banks to decide what kinds of transactions they are willing to do with the bank. Therefore, the service and the information providing of the overseas branch on their websites are even more important, for it is not really easy for Taiwanese customers to visit their overseas branches. Hence, the forth proxy of the competence of the local branch is the evaluation of the overseas branches’ websites. The determination of the category variables are listed below:. Table 3.3 Determination of the category variables of the evaluation of the websites Criteria for evaluation of the website. Category Variable. Without the link of the website of 1 overseas branch on the official website. The link of overseas branch’s website is after or on the second layer of the navigator of the official website, and the. 2. information provided on the overseas branch’s website is not clear. The link of overseas branch’s website is after or on the second layer of the navigator of the official website, but the information provided on the overseas branch’s website is clear.. 25. 3.

(31) There is a category of overseas branch’s website on the navigator of the official 4 website, and the information provided on the overseas branch’s website is clear. Source: This research designed.. These four indicators are important for determine the competence of the local branches, especially the branch ages and the ROE and ROA performance of the banks, which are weighted more in the calculation. In order to estimate and set their coordinates on the horizontal axis, we design the equation:. (The category variable for the existence years *3+ The category variable for the variety of services and product *1+ The category variable for ROEs and ROAs performance of the banks*2+ the category variable of the evaluation of the websites*1)/8. 3.1.2 Vertical Axis-Strategic Importance of the Local Environment. Then for the vertical axis, the strategic importance of the local environment, I choose the Index of Economic Freedom 2014, an annual guide published by The Wall Street Journal and The Heritage Foundation. The 35 components and the scores of countries are shown in the Appendix 2. Through these 35 components, the index explains the real financial and investing situation of the countries in a considerate. 26.

(32) aspect. In addition, the scores are ranked from 0~100. The scores would represent the coordinates of vertical axis on the Bartlett and Ghoshal’s model (1986).. With the vertical and horizontal coordinates of each branch of different banks, we can draw the scatter plot on the generic role model of Bartlett and Ghoshal (1986) by banks. Afterward, the scatter plot models of each bank could help us with distinguishing and analyze each bank’s setting strategic and orientation of overseas branches.. 3.2 The Evidence of Innovation To prove my proposition about “strategic leaders” have better chance to conduct product or service innovation and bring the merit to the whole organization, I cross examine the scatter plots with the innovation prizes they won to see if the more strategic leaders they have, the more likely that they would be praised as innovative banks. Those innovation prizes can be separated into domestic prizes and international prizes, including two representative and authoritative prizes: one is The Annual Product Innovation Prize from 2007 to 2012 held by TABF (Taiwan Academy of Banking and Finance). The other award is the Asian Financial Insights Innovation Awards (FIIA) held by IDC (International Data Corporation) Financial Insights. The Financial Insights Innovation Awards (FIIA) is one of the international awards established to recognize the innovations designed to achieve specific business objectives of financial services institutions across the region. The FIIA projects and the winners are selected by a panel of highly respected independent industry practitioners and IDC Financial Insights analysts. The list of each bank’s record of financial innovation prizes winning is in Appendix 3. 27.

(33) 3.3 Interviews Among those Taiwanese banks with overseas branches, I have chosen two different banks to conduct the face-to-face interviews in order to explore the process of innovation adoption of their overseas branches. The first interview is with the AO chief officer of SCSB Hong Kong branch, and the second interview is with the chief of Great China Division of Hua Nan Bank.. SCSB Hong Kong branch is the first overseas branch of SCSB. At the first two years, the branch was not performing well. On Bartlett and Ghoshal’s model, it was a branch set as a “black hole”. However, after few years, it gradually took the advantage of the strategic importance of the local environment, and later transformed into a “strategic leader”. During the interview, Manager Hsieh would explain the obstacles they faced in Hong Kong and how they seize the chance and adopt innovation in order to improve their returns, and furthermore, be beneficial to the headquarters. The purpose of this interview is to prove my second proposition.. On the other hand, Hua Nan bank is a bank with many overseas branches and many of them are in the financial centers in the world. However, their product innovation performance is not better than the other privately owned banks. Therefore, the interview with Hua Nan bank, Sam Chen, would focus on why state-owned banks have lots of overseas branches set in those international financial centers, yet the pace of product innovation seems to be slower than the other privately owned banks.. 28.

(34) Chapter 4: Results In this chapter, we would explain the result and process of testifying the two propositions respectively. The results listed below including second-hand empirical analysis and first-hand interview recording.. 4.1 The relationship of the roles of “strategic leader” & “black hole” and financial innovation performance According to the generic role model of Bartlett and Ghoshal (1986) with the proxies we selected and estimated, we drew ten graphs which respectively represents the strategic-role profile of their overseas branches (to see Appendix 4). By analyzing the ten graphs and cross-examining with the evidence of financial innovation (to see Appendix 3), we composed an analysis chart as Table 4.1, suggesting that most of the banks with more than 50% of overseas branches in roles of “strategic leader” and “black hole” are more likely to have better financial innovation performance for winning at least five or more innovation prizes. The results above confirm the correlation of overseas branch’s strategic roles and the innovation performance suggested in proposition 1.. However, in Table 4.1, there are three outliers that fail to respond to the correlation suggested by proposition 1. The three banks are state-owned banks. Their operation styles seem to be very different from the privately owned banks. That is to say, through the result of the cross examination of generic role models and the evidence of innovation, we found that there are two types of banks. One is the banks that have many strategic-leaders and black-holes as their overseas branches, and also 29.

(35) won prizes of innovation. Namely, those strategic-leader and black-hole branches help the bank with innovation adoption. Usually, those are the privately owned banks. While there are the other banks which have many strategic-leader and black-hole branches but won few or none prizes of product innovation. Mostly, these are the government own banks. Therefore, to explore the reason, we conducted a face to face interview with one of the state-owned banks’ representative, the chief of Great China Division of Hua Nan Bank. The interview result is as follow:. 4.1.1 Interview result of Hua Nan Bank. Most of the bankers believe innovation could solve the problem of overbanking, so do those state-owned banks, including Hua Nan Bank. According to their chief of Great China Division, Sam Chen, Hua Nan Bank prefers to set up overseas branches either in international financial centers, including Hong Kong, Singapore, London, New York and Los Angeles, or countries congregated with Taiwanese firms, like Vietnam and east China.. Those international financial centers could have been served as a window of innovation accession, for in those places, there are full of the most various and advanced financial products and services. Although Hua Nan Bank has fewer clients in those financial centers, which leads to the lack of bank deposit, the overseas branches there are set as a whole-sale bank by operating loans mainly. In addition, they gain the deposit by inter-bank borrowing, for in those international financial centers, inter-bank borrowing is easy. The facts above reveal the reason why they don’t need the branches in financial centers to adopt innovation.. On the other hand, the branches in Vietnam and east China focus more on the 30.

(36) retail business, for they are imbedded in local laws and regulations. For instance, the Vietnamese government forbids those foreign financial institutions to operate loans in large amount. Therefore, to better serve those Taiwanese-company clients, the branches prefer to do the retail financial services. They could only exploit the original relationships of these firms.. With the two differentiated strategies of location choice, the branches of Hua Nan Bank in international financial centers had access to many innovative financial products. Their attitude toward innovation adoption is always to answer passively to customers’ needs. Hua Nan Bank knows the frequency of innovation of them is less than the other privately owned banks, for a state-owned bank like Hua Nan Bank, they need to be extra cautious to the risk.. Furthermore, in Hong Kong, their branch was the first branch of Taiwanese bank, so they gathered more customers than the other Taiwanese branches. As a result, the Hong Kong branch of Hua Nan Bank might not be as aggressive about innovation as the others. Even setting branches in those global financial centers, state-owned banks like Hua Nan Bank, prefer to exploit their existing client relationship but rather than to spend efforts and money to explore the market and to win the first mover benefit.. In the case of Hua Nan Bank, they are lacking the motivation of innovation because of their special ownership structure results in the risk-aversion style of management and the sufficient customer source. For state-owned banks, exploitation is always the preferred strategy in overseas market. Therefore, that is the reason for those state-owned banks that they seldom win the prize of innovation even though they have set many branches in those global financial centers and in roles of strategic leaders or black holes. 31.

(37) Bank. 0. 2. 0. 2. 3. 3. 1. 1. 2. 1. 3. 0. 0. 0. 0. 0. 1. 0. 1/2 (50%). 2/5 (40%). 3/4 (75%). 4/6 (66.67%). 3/4 (75%). 5/9 (55.56%). 1/1 (100%). SL and BH. Percentage of. 2. 2. 1. 5. 5. 7. 7. 2. Prize. Domestic. Prize. 0. 0. 0. 4. 0. 2. 3. 5. 11. International. 1. 2. 2. 2. 5. 5. 7. 10. 12. 13. prize in total. 2 3. 3. 0. 6/9 (66.67%). 2. 0. Contributor. 0 2. 1. 1. 13/21 (61.90%). 1. Implementer. 0. 1. 3. 1. 6/7 (85.71%). Black. 0. 6. 7. 0. Strategic. 0. 6. 1. hole. 5. 6. leader. 0. Table 4.1 Analysis of Ten Selected Banks Oversea-branch Generic Roles and Financial Innovation Performance. 台新銀行 Taishin International Bank 中國信託銀行 CTBC Bank 玉山銀行 E. Sun Bank 國泰世華銀行 Cathay United Bank 永豐銀行 Bank SinoPac 台北富邦銀行 Fubon Financial Holdings 上海商業儲蓄銀行 SCSB bank 華南銀行 Hua Nan Bank 兆豐商銀 Mega International Commercial Bank 彰化銀行 Chang Hwa Bank. Source: This research analyzed.. 32.

(38) 4.2 The role “black hole” is dynamic The interview result of Shanghai Commercial & Savings Bank reveals the process of how a black-hole branch gradually shifted its role into “strategic leader” by improving its competence.. 4.2.1 Interview result of Shanghai Commercial & Savings Bank. SCSB Hong Kong branch has undergone a dynamic growing process. According to the interview with Manager Hsieh, at the beginning two years, the branch is facing loss, for SCSB set its first overseas branch with lower competence. The local financial environment in Hong Kong is comparitively strategically improtant with the highest score of Economic Freedom 2014 index (to see Appendix 2). Without doubt that Hong Kong is a financial centor of Asia consisting with many international bankers and investers.. Nevertheless, the branch was asked to offer only the basic services and be forbidden to operate the Syndication Loan. Due to the fact that their headquarters were afraid that loans in mass amount would demage the equilibrium of debits and credits. The SCSB’s headquarters planned to let their Hong Kong branch be localized and do business with local people. However, for a brand new branch in different country, it is impossible to have stable client resource at the first few years. Therefore, when the local manager convinced the headqueater, they changed their direction and started to process the Syndication Loan and other new products, like off-shore loan against domestic guarantee.. 33.

(39) Although SCSB’s Hong Kong branch was not easy to breakeven on the spread sheet in the fisrt few years, the branch offered the headquarters lots of new opportunities, new products, and chances to join the associated loan cases in great scale. It is those chances of innovation that accelerated the growth of the branch, and gradually pushed it into the “stategic leader”. At that time their efforts on remodeling their Hong Kong branch even won them the 2007 Best International Development Award from TABF for being the first to process the remitting of RMB and NTD.. Base on the interview result and the official information we compose the two different graphs of different times of SCSB and also a table of the category variables of SCSB Hong Kong branch in different years as following:. Figure 4.1 The overseas-branch profile of SCSB in 2008. Figure 4.2 The overseas-branch profile of SCSB in 2014. Source: Bartlett & Ghoshal (1986); This research composed.. 34.

(40) Table 4.2 Category variables of SCSB Hong Kong branch in different years Category variables of SCSB Hong Kong branch in different years Variety Strategic Branch’s. of. Competence Evaluation. product. ROA/ROE. age. importance of. local. of website and. Strategic role of. local. organization environment. service. 2008 2014. 1 1. 1 3. 3 4. 2. 2. 4. 3(2.88888). 4. Black-hole Black-hole but. 4. Strategic-leader to be. Source: This research calculated.. In Table 4.2, it reveals SCSB Hong Kong branch’s category variables in different years. In 2008, when the branch was first set in Hong Kong, the product and service providing in the branch is much fewer than the present time. Therefore, the category variable of variety of product and service ranked low. And also their ROA/ROE performance and the website evaluation are worse than nowadays.. However, in 2014, SCSB Hong Kong branch has improved its product and service providing. They are allowed to operate most of the kinds of the products and services except financial management. Hence, they are now ranked high in the category variable of product and service variety. Furthermore, their ROA/ROE performance is great and they made a wonderful website of the Hong Kong branch. The category-variable ranks of ROA/ROE performance and website evaluation are both improved. Therefore, the role of SCSB Hong Kong branch has gradually turned into a black-hole but strategic-leader to be.. 35.

(41) The story of SCSB Hong Kong branch confirms my second proposition suggested that a “black hole” could be turned into “strategic leader” after an improvement of competence.. 36.

(42) Chapter 5: Discussions & Implications In this chapter, there are three sections. In the first section, we would discuss the findings in this research. In the second section, we would explain the limitation to this study. The last section is about the contributions and implications of this research.. 5.1 Discussions Since the Taiwanese banks are facing the problem of “over-banking”, setting overseas branches to expand the market, or adopting innovation are both the possible solutions. However, there are many syudies about location factors of the overseas or different kinds of financial innovation, but there are few studies discussing the relationship of overseas branches and innovation performance in banking industry. Futhermore, we are the first study to reframe the strategic roles of the overseas branches with Bartlett and Ghosal’s model.. There are two main purposes of this research. One is to create a new profile of each bank. Namely, we reveals that there are not only two strategies that deicided by the location factors. The banks should consider the competence of each branch which divides the generic roles of overseas branches into four. The other purpose is to cross examine their overseas-branch profiles with the innovation prize winners. Hence, we tried to prove that banks with more overseas branches in roles of “strategic leader” and “black hole” are more likely to have better innovation performance.. Through composing and anaylzing the profiles of the overseas branch for each bank, we have discovered some interesting findings. Most of the banks correspond to our proposition about the positive relationship of financial innovation performance 37.

(43) and the amount of overseas branches in roles of “strategic leader” and “black hole”. However, there are some outliers in our analysis. Those banks happen to be state-owned banks. Therefore, in order to explore the real reason of not showing the positive correlation, we conducted an interview with one of the Taiwan governmment owned banks. It turns out the reason for those Taiwan governmment owned banks possessing many overseas branches in roles of “strategic leader” and “black hole” but not improving their innovation performance is that they lacks the motivation of innovation. Those Taiwan governmment owned banks have sufficient client resource. The phenomenon of “over-banking” has less influence on them. As a result, instead of spending money and energy on adopting innovation, they prefer staying risk-aversion and exploit their present resource.. The second finding is about the roles of overseas branch are dynamic. The profile of the overseas branches only indicates their present distribution. If those branches have been improved their compentence, they could shift to another role. Therefore, we proposed that the branch in role of “black hole” could be changed into “strategic leader” as long as the competence of the overseas branch has been improved. In order to prove our proposition, we conducted another face to face interview with SCSB to explore the improvement process of SCSB’s Hong Kong branch which has been evaluted from “black hole” to “strategic leader”. The major change of SCSB’s Hong Kong branch is the extension of product and service variety, for the headquarrters had changed its manage attitute toward their overseas branch. Furthermore, there are many latest financial ideas in Hong Kong that are easily to access. And through the accumulation of the branch’s age, the competence of the branch has been improved and is moving rightward to the “strategic leader” on the. 38.

(44) graph. We suggest that every bank should not ignore the way to improve its overseas branches.. The third finding is about the phychological distance of those overseas branches. There is an interesting fact we found in those profiles, which is that every Taiwanese bank has set one of their overseas branches in Hong Kong, and about 80% of them have also set an overseas branch in Singapore. These two places are the only two financial centers in the world that have Chinese as one of their official languages and also adopt chinese culture. If Taiwanese banks want to set overseas branch to gain access to lateset financial products/services, these two places should be their first choice. Due to the shorter phychological distance of these two places in Taiwan, the Taiwanese bankers would face fewer uncertainty risks or culture shocks (Roberts and Arnander, 2001). Besides the advantage of management of the overseas branches in these two places, maybe for future research, we could explore if the innovation is more easily to adopt in these two places.. To sum up, the research is made for two purposes: one is to reframe the generic roles of overseas branches, the other is to prove the number of overseas branches in roles of “strategic leader” and “black hole” is positively related to innovation performance. And by adopting the analytical approach, the research findings are mainly about three issues: one is about the two different kinds of banks, the privately owned banks and the state-owned banks. Different management styles results in different motivation toward innovation adoption. The second issue is about the movement of the strategic roles. The third is about the psychological distance of Hong Kong, Singapore and Taiwan.. 39.

(45) 5.2 Limitations Despite the novelty of the reasearch, there are some limitations that are hard to overcome. First of all, there is a limitation of the research samples. Taiwanese privately owned banks with overseas branches so far are only the seven privately owned banks selected in the reasearch. Perhaps in the future there will be more Taiwanese privately owned banks set up overseas branches, and the research result will be more prominent.. Secondly, the proxies for estimating the competence of local organization in Bartlett and Ghosal’s model is limited due to the difficulty of data collection. So far, we adopts the four proxies: (1) branch’s age, (2) variety of products and services, (3) ROA and ROE performance of the bank, (4) evalution of the website. However, we failed to get each overseas branch’s labor amount and market share. Because the overseas branch’s labor amount and market share are not the open data for the public. Banking industry compares to the other industries is more conservative, which enhances the difficulty of data collection in this research.. Although there are some limitations in this research, we have tried our best to weaken the influence. The four chosen proxies for the competence of local organization become much more sufficient after weighted on certain parts. Perhaps, for the future research, if possible, researchers could go to those countries and conduct surveys for the oversesa branches of each bank, and then calculte the market shares of each branch.. 40.

(46) 5.3 Contributions & lmplications There are several managerial implications and contributions in this study. First of all, this study is the first research that cross examine the correlation of overseas branches’ strategic roles and the financial innoation performance. There are few studies apply susidiary strtegic roles in innovation performance research. The former studies are mostly discussing susidiary strtegic roles and their autonomy. In addition, the managerial implication of this study is to illustrate the purposes of setting overseas branches are not only to expand the market, but also to get access to latest financial ideas, and improve innovation performance of the bank.. Secondly, the adapted four different strategic roles in this study are worthwhile for bankers to consider before setting overseas branches. The four generic roles implys the different appropriate strategies in different environment and competence. With this modified theory model, bankers can reconsider their overseas-expanding strategy. Furthermore, for future researchers, they could keep tracks of those bankers, and to see if their overseas-branch profiles could reflect their overseas expanding strategy.. To sum up, this study is the first to combine the two issues of overseas branches and financial innovation performance, and moreover, adopting the theory of Bartlett and Ghoshal. This study creates lots of possibilities of future researches. In addition, this research provides a new way for Taiwanese bankers to reconsider their overseas expanding strategy. We hope that this study would encourage Taiwanese bankers to emphasize the importance of financial innovation. With better financial innovation performance, Taiwan banking industry would overcome the difficulty of “overbanking”, and once again become competitive in global market. 41.

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(53) Appendixes Appendix 1 Ten Selected Taiwanese Banks and Overseas Branches 銀行名稱. 海外分行. 1. 上海商業儲蓄. 1.. 香港分行. 4. 兆豐國際商業銀行. 2.. Hong Kong Branch 越南分行. Mega International Commercial Bank. 銀行 Shanghai Commercial & Savings Bank. 3. 4.. 1.. 九龍分行 Kowloon Branch. 紐約分行 New York Branch 洛杉磯分行 Los Angeles Branch 芝加哥分行 Chicago Branch 矽谷分行 Silicon Valley Branch. 5.. 巴拿馬分行 Panama Branch 箇朗自由區分行 Colon Free Zone. 2.. 香港分行 6.. 3.. Hong Kong Branch 新加坡分行. 4.. Singapore Branch 斯里伯魯德分行. Branch 7. 巴黎分行 Paris Branch 8. 阿姆斯特丹分行 Amsterdam Branch 9. 東京分行 Tokyo Branch 10. 大阪分行 Osaka Branch 11. 馬尼拉分行 Manila Branch 12. 胡志明市分行. Sriperumbudur Branch 5.. 上海分行 Shanghai Branch. 6.. 紐約分行 New York Branch. 7.. 新德里分行 New Delhi Branch. 8.. 胡志明市分行 Ho Chi Minh City. 9.. Ho Chi Minh City Branch 13. 金邊分行 Phnom Penh Airport Sub-Branch 14. 新加坡分行 Singapore Branch. Branch 東京分行 Tokyo Branch. 3. 國泰世華銀行. 2.. Vietnam Branch. 2. 中國信託 CTBC Bank. 1.. 1.. 洛杉磯分行. 2.. Los Angeles Agency 香港分行. 3.. Hong Kong Branch 新加坡分行. 4.. Singapore Branch 上海分行. 18.. 5.. Shanghai Branch 納閩島分行. 19.. 6.. Labuan Branch 越南茱萊分行. Cathay United Bank. Chu Lai Branch. 15. 納閩分行 Labuan Branch 16. 香港分行 Hong Kong Branch 17. 雪梨分行. 20. 48. 21.. Sydney Branch 布里斯本分行 Brisbane Branch 墨爾本分行 Melbourne Branch 倫敦分行 London Branch 蘇州分行 Suzhou Branch.