12 Nov.
2020

AMBS academic presents to one of China’s “Big Four” banks on the impact of COVID-19 on global banking and finance

Lecturer in Banking at Alliance MBSIsmail Ertürk, was recently invited to present to senior managers of Agricultural Bank of China on the impact of the COVID-19 crisis on global banking and finance. Alliance MBS’ strong relationship with Agricultural Bank of China, the third largest bank in the world by assets, continues to grow and develop.

Ismail Ertürk has designed executive education banking programmes for the senior managers of Agricultural Bank of China over the last five years, supporting the bank’s transformation into a modern, international financial services company.

Following Ismail's annual trip to the Bank’s Head Quarters in Beijing at the start of the year, and based on his extensive research into global banking and financialisation, the Bank invited him to present an online session to their senior leaders. The webinar, titled “Global Finance after the COVID-19 Crisis” was delivered to over 100 senior managers of Agricultural Bank of China, on Wednesday 21 October.

The presentation began by highlighting the trend for central banks globally to intervene heavily in financial markets since March 2020, when the US and Europe went into lockdowns and economic activity across the world came to an unprecedented stand still. Ismail explained how central bank monetary policies and quantitative easing succeeded in preventing a meltdown in financial markets, similar to the one experienced in 2007. He therefore argues for the increasing dependency of the global financial system on these central bank monetary policies and quantitative easing.

Covering other highly relevant topics, Ismail explored how digitalisation has gained further momentum in banking during lockdowns, as bank customers had to use digital platforms to carry out their banking activities. He also used the case study of Ant Group, a Chinese FinTech company, to discuss the prospects of FinTech after the COVID-19 crisis. Ant Group has already disrupted retail banking in China posing a significant competitive challenge for Agricultural Bank of China as well as for other large traditional banks in China.

In the final part of the session, Ismail fielded questions from the audience about whether banks in the US and Europe will be able to support the economic recovery and how Chinese banks can rethink their internationalisation strategies.

Ismail commented: “The audience were receptive to the suggestion that with careful risk assessment Chinese banks can fill the gap that other international financial institutions have created in emerging economies.”

“Emerging economies have suffered after the COVID-19 crisis as the flow of foreign capital has deteriorated and the export markets in the US and Europe have shrunk. This opens up welcome opportunities for Chinese financial institutions, such as the Agricultural Bank of China to further their international expansion; one of the Bank’s key strategic goals already being supported by the Executive Education Centre’s programme.”

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