Francisco González, the executive chairman of the BBVA Group, is a member of the International Advisory Panel of the Monetary Authority of Singapore (MAS) and is a frequent visitor to the country. This weekend, he took part in the Singapore Summit, an event aimed at “connecting Asia with the rest of the world.” While there, Francisco González granted an interview to the Spanish daily ABC, in which he speaks about the “extraordinary moment” the bank is going through, having chosen to embark on a digital endeavor, the results of which have been striking. These results include an increase in digital sales, which accounted for 42 percent of total sales in July. “The first fruits of digitization have been really superb,” he says.
The BBVA chairman puts the emphasis on the bank’s digital transformation which has offered up “spectacular figures.” These figures encompass both the number of digital customers and the revenue they are generating. The costs of digital customers amount to a third of that of non-digital customers. The churn rate for digital customers is also half.
With these figures in hand, Francisco González is optimistic about the future. The BBVA chairman expects the bank to “play a very significant global role” because “we are the bank that is clearly ahead on a global level in terms of transformation.” He predicted the emergence of “a new league of players” that apart from banks will also include fintechs and some of the internet giants such as Amazon, Google and Alibaba.
BBVA will create its own ecosystem, a huge platform where we can choose the best products and experiences wherever they are
What will BBVA’s role be? Francisco González explains that the bank will create its “own ecosystem, a huge platform where we can choose the best products and experiences wherever they are.” BBVA will be a personal advisor for the customer, ever attentive to their day-to-day needs. “We want to be there at all of the important moments of their lives,” he says.
BBVA executive chairman Francisco González. - BBVA
The data belongs to the customer
A key aspect of the digital financial environment is regulation. “A new economic and social order is being created” and “the legal architecture we currently have is not in in step with this new world,” he says. He warns about the problems of privacy that are brewing. The big debate, in his opinion, revolves around data ownership. “We have it very clear; the data; it’s the customer’s data. And if we want to use this information, authorization must be specifically granted by that person.”
"We have it very clear; the data; it’s the customer’s data. And if we want to use this information, authorization must be specifically granted by that person"
Francisco González believes the regulations will be very much focused on protecting data. Based on his experience “a bank such as BBVA has a big advantage in this area.” Regulation is growing, he acknowledges, but warns: “It has to be regulation that balances on the one hand protection of the consumer (to avoid systemic risk, that is, monopolies) and on the other support for innovation.”
The same applies to the case of blockchain, where, in his opinion, regulation will be also very important. He believes it is essential to understand that blockchain “could bring about the disappearance of intermediation in general.” But it could also mean an opportunity and BBVA is working to take advantage of its potential, he says.
Asia is coming to the forefront
Asked about the role of Asia in the new international order, Francisco González has it clear: “Asia as a whole, and particularly China, is starting to take a leading role.” And in his opinion, the West has to react. Likewise, in the interview the BBVA chairman warns about the negative impact of a ‘trade war’ between China and the United States and the increase in protectionism in general, while coming out on the side of fostering international trade. “We are very happy with the in-principle agreement between the U.S. and Mexico, and we hope now Canada will come on board.”
"We are very happy with the in-principle agreement between the U.S. and Mexico, and we hope now Canada will come on board"
As regards BBVA’s strategy in the Asian region, the chairman indicated it is completely digital-oriented. For example, the bank recently invested $50 million in Sinovation Fund IV, the fund specializing in artificial intelligence led by Kai-Fu Lee.
On the lessons Spain could take from Singapore, Francisco González names several: the good use of the free market economy, the digital focus, regulatory openness and the ability to attract companies and international talent.