Opening Speech by Mr. Howard C Dickson, Government Chief Information Officer, at the Banking and Finance Technology Forum 2005
8 - 3 - 2005

Ladies and Gentlemen,

Good Morning!

I am honored and pleased to have the opportunity to extend my warmest welcome to all participants of the Banking and Finance Technology Forum for 2005.

It is just over one month since I traveled here myself to take up the post of Government Chief Information Officer. Helgard, my wife, and I arrived at the end of January and thereby avoided February in Canada ......which is highly recommended by most Canadians!

We have been welcomed everywhere here in Hong Kong with a remarkable service attitude. This supportive culture extended from the initial hotel, the apartment, restaurants and shops, to the IT industry, colleagues at the Government and so forth.... but let me get back to banking and your agenda here for the next two days.

I notice from your program that your theme is "Competing for Market Share" with topics ranging from

• Transformation through Technology,
• Outsourcing Strategies,
• New Regulatory Requirements and the implications for risk, and
• Customer Satisfaction, Loyalty and Intimacy.

While technology is ever advancing, these issues are not new, even for someone who last served in Banking 8 years ago. However, it strikes me that we share a common interest as both the financial and the government sectors strive to improve performance and customer experience at the same time by continuously transforming their institutions, their governance and their processes with the application of Information Technology.

Hong Kong has been renowned as an international financial centre for many years. The financial services industry is one of the core industries in Hong Kong. The recent Policy Address of the Hong Kong SAR Government expects us to "seize the opportunities brought by the dramatic growth of the Mainland economy to further enhance Hong Kong's role as an international financial centre".

How can we achieve this? Government policy, legal system, experienced bankers, financial talents, free market, fair competition, easy flow of money, ......your efforts, are all major attributes. Nowadays, information technology (IT) has become an important tool, not only in supporting the basic operations of financial institutions themselves, but also in sharpening their competitiveness. IT enables our financial systems to become the back-bone of the global marketplace.

Your Government has been actively promoting the use of IT in various business sectors. We have built the related IT infrastructure for electronic transactions. For example, in January 2000, the Electronic Transactions Ordinance (ETO) enabled electronic records and digital signatures to have the same legal recognition as their paper-based counterparts.

The ETO also provides a framework for the voluntary recognition scheme for certification authorities (CA), which enhances security and public confidence in conducting electronic transactions. To lead by example in adopting e-business, the Government launched the Electronic Service Delivery (ESD) Scheme in December 2000. The Scheme now provides over 200 types of online public services from over 50 Government bureaux, departments and agencies, many of which handle financial transactions.

The root of effective customer service in both of our environments is "knowing your customer" accurately and quickly. Relocating within and between countries, which I have done on several occasions, can be revealing of the current state of the banking system. Let me share with you one of my earliest banking experiences when I was a young graduate.

May I digress?

We arrived in Morinville, Alberta, Canada in early September 1967 with the temperature in the 30s. Morinville is a small town about 60 km north of Edmonton where the cattle clearly outnumber the people. The local business community consisted of

• a gas station,
• a grocery store,
• a hardware store,
• a beer parlour,
• a Catholic church,
• a 4 teacher school and of course,
• a branch of one of Canada's big 5 banks.

We looked out of the bank window to see Harry crossing the road and entering the grocery store, coming out, quickly counting notes. Next was the beer parlour. Then the garage. Always a few words exchanged, a quick joke, hands shaken, and bank notes stuffed in his pocket. These were then delivered to us (against a loan note) with an apology that this was all he could raise.

Nearly 40 years later, banking has changed and I have changed. We don't have to go to the same bank as our employer to be introduced, we can reach across oceans to access bank accounts, we are not shut from our account when the bank is closed. There is a plethora of complex banking products.

But as risks and regulations have grown in accordance with the vast expansion of electronic business volumes (and profits), there has been a corresponding decline in the access to staff.

Since arriving in Hong Kong, we have overcome the conundrum of needing a proof of address to open a bank account and needing a bank account to get an address.

Along the way, after delays and, yes, some outstanding successors of Harry White willing to risk "an exception", we noticed a few things.

• New customers with no permanent local address are suspicious
• Having available funds merely increases the suspicion
• We lack instant information tools to know the client before us
• We use Utility bills / 6 months history to authenticate
• The manager's authority and discretion have been eroded
• Harry White had the information tools for his era.
• His successor likely has her accounting degree and an MBA but
• ..she lacks the relevant information tools and authority for trusted service

How can we use information technology to provide instant knowledge of the customer? Without it, we will all continue to wallow in costly and relation damaging bureaucracy.

So I would like to leave you with this challenge which is also the challenge of government: Let us explore how we can use IT to enable the Harry White service spirit to thrive both in banking and as well as in the public service by providing information tools that are immediate, ubiquitous and reliable, without resorting to exceptions.

This will in turn give support to our other issues, and customer satisfaction, loyalty, market share and efficiency (and of course, confidence in government) will follow.

Finally, I would like to take this opportunity to congratulate the organiser for staging this event.

I wish the Forum a great success.

Thank you.

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