Banks creating opportunity and headache at the same time.

I've recently been asked by a close friend of mine, I've just started working and find it extreme hard to save on a monthly basis, especially with current rising cost of living, which bank would offer the best return for me to begin saving my first? Well before I actually talking about that, I think its crucial for you to know how the banking industry have develop over the year since the 1997 Financial Crisis which struck Asia and the world by suprise. Therefore let me explain it as simple and short as possible.

Malaysia which have 55 banking and financial institutions prior to the 1997 crisis have seen the number shrunk to only 9 local commercial banks now(also known as anchor banks). Ultimately it is the Central Bank intention to reduce it further to only 5 local anchor bank. Althought the local banks have shrunk in numbers but they are definatelly stronger in term of assets and earning.

The nine local anchor banks are Affin Bank, Alliance Bank, AM Bank, CIMB Bank, EON Bank, Hong Leong Bank, Maybank, Public Bank, and RHB Bank. These local banks are now facing intense competition from foreign banking group such as Citibank, HSBC, OCBC, UOB, and Standard Chartered. (take note that there are others like )

With so many foreign banks sprouting like mushroom in your local neighbourhood following the Central Bank recent move to open up the banking industry. Ordinary folks like you and me have often been mesmerise by the figures in which these foreign banks plan to invest in their quest to expand its operations frequently reported by the local media well as continous service improvement. Investments by these banks were so huge that it would only remain as a dream for many of us.

What does the central bank of Malaysia move to consolidate local banks and opening up the industry to foreign banks means to ordinary folks like me and you?

1.) Increase accessablity, as local banks consolidate, they have more branches.
2.) Intense competition within the industry, thus banks tries to offer more value added product/services while reducing cost.
3.) More sophisicated financial products for the increasing knowledge based Malayian.

4) More career opportunity are created.

With so many banks available and ready to provide their service, we as consumer are certainly being spoiled by choice. In some case, it has turn out to be a headache for consumers. Why?

For example, a simple product such as saving account or Fixed Deposit(as known as FD) is being offered with different structure, benefit and most importantly interest rate.

So what if you plan to begin saving? which bank will be able to provide the rate? what other benefit included? What are the charges?

If you would like to know, be sure to read my next posting. Cheers