SINGAPORE (Reuters) - Singapore’s DBS Group, Southeast Asia’s biggest lender, has appointed Piyush Gupta from Citigroup as its new chief executive, hoping the veteran banker will help it grow in India and China.
The decision to appoint Gupta, 49, who oversees Southeast Asia and the Pacific for Citi, was unexpected after analysts had speculated that DBS might choose an insider for the post.
The appointment came nearly five months after DBS’s previous CEO Richard Stanley died of cancer, at a time when its two main markets of Singapore and Hong Kong come out of recession and as Asian banks are seizing market share from foreign rivals.
DBS said on Tuesday that Gupta, who has been with Citi for 27 years, will join DBS in November. He will be the company’s second straight CEO from Citi, where Stanley also joined from.
“Two factors appear favourable — Piyush has extensive Asia experience, in Singapore, ASEAN, India, and he has held roles across corporate and consumer banking businesses,” said Harsh Wardhan Modi, a banking analyst at JPMorgan.
“This appointment should remove a key overhang for the stock in the near term and should prove to be a catalyst,” he said.
DBS shares extended gains after briefly being placed on a trading halt, up 2.7 percent in a broader market up 1.5 percent.
The stock has risen 53 percent this year, slightly outperforming a 49 percent rise in the benchmark Singapore index.
Indian-born Gupta’s experience will help DBS to expand in India, where the Singapore bank has 10 branches and is seeking permission to open eight more. He has spent 20 years in Southeast Asia and Hong Kong.
DBS, 28 percent owned by state investor Temasek Holdings, currently earns 90 percent of its profits from Singapore and Hong Kong and is keen to expand in Asia.
“We are confident that he will help to strengthen our franchise and grow our footprint in Asia,” said DBS Chairman Koh Boon Hwee, who has been running the bank since the start of the year.
Gupta’s appointment is subject to regulatory approval, DBS said.
Citi, which has been badly hit by the financial crisis, has lost many high profile bankers in recent months. In June, Mastercard hired Citi’s Asia head Ajay Banga.
“While it is not unusual for Citi bankers to be sought after for leadership positions in other organisations, we are fortunate that Citi has a particularly deep bench of senior talent both in Asia and around the world,” said Citi’s CEO for the Asia-Pacific Shirish Apte.
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