Zeti Akhtar Aziz: Developing a robust competency framework for the Malaysian
banking industry
Opening speech by Dr Zeti Akhtar Aziz, Governor of the Central Bank of Malaysia, at the Industry
Competency Framework Study Focus Group Discussion, Kuala Lumpur, 6 December 2005.
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Saya berasa amat bangga kerana diberi peluang untuk menyampaikan sepatah dua kata dan
seterusnya merasmikan Sesi Wacana Institut Bank-Bank Malaysia. Saya ingin mengucapkan terima
kasih atas penyertaan anda dalam temu ramah eksekutif yang merupakan input yang amat bernilai
dalam pembentukan rangka kerja kompetensi industri yang akan dibincangkan hari ini.
The banking sector will remain the pillar of our financial system, as it evolves to offer more innovative
financial solutions to meet the changing needs of the economy. The industry however, needs to be
well positioned in a financial landscape that is continuously being redefined. While new opportunities
have emerged, there are also new challenges on the horizon. Foremost amongst these is intensified
competitive pressures, spurred by financial liberalisation and technological revolution. Other
challenges include the growing demands of customers for differentiated product offerings and
valueadded services at more competitive prices, excellent service quality, and superior level of efficiency.
Strategic opportunities also arise from new growth areas and a larger marketplace as economic
integration regionally and globally gather pace, driven by increasing regional and global trades and
investment flows. Banking institutions must be ready for the challenges and be well equipped with
distinct capabilities to take advantage of the opportunities that the new environment accords.
Banking is a knowledge-intensive, skills-based and relationship-rich industry. In an increasingly
complex and a more liberalised environment, the competitiveness of banking institutions will depend
critically on the quality of human intellectual capital and the extent to which the industry is able to
leverage on these talents. To compete effectively, banking institutions need professionals with the
requisite skills and expertise not only at the strategic and management level, but also at the technical
and operational level. Successful institutions will be the ones which accord high priority to effective
placements, rewards, retention and most importantly, lifelong learning and the continuous
enhancement of human capital. Lifelong learning is becoming increasingly important in this
knowledge-based economy where knowledge and skills need to be continuously updated and
upgraded. At the macro-level, the breadth and depth of skills of the entire financial services workforce
will increasingly be the defining factor in determining the success in building a more efficient, effective
and dynamic financial sector. The availability of appropriately trained and competent human resources
is a critical factor key to support the performance of the industry. In essence, continuous strengthening
of intellectual resources and capabilities must be made to create a larger pool of talents and high
calibre professionals in the banking and finance industry.
Competence and skills development have always been an area of focus, but it will be even more
important as we prepare our workforce for a more challenging environment, one that is more
competitive and more complex. The first step is to build the skills required at the tertiary level to ensure
that the curriculum at our universities and colleges equip graduates with the relevant knowledge and
skills that meet the needs of the industry. In this respect, closer cooperation between the industry's
training institute and the academia will help to develop a new breed of graduates who will be much
better prepared to enter the workplace. At the post-employment stage, we need incentives for
continuous learning and upgrading of skills and an infrastructure that delivers the appropriate training.
For the development of banking sector workforce, the International Centre for Leadership in Finance
(ICLIF) was established to pave the way for the development of future leaders in the industry, while
Institut Bank-Bank Malaysia (IBBM) provides the avenue for competency building among the various
levels of staff.
With the onset of financial liberalisation, the traditional lines of business are likely to expand into new
areas and new business models. As a consequence, the skills requirements have also evolved with
the growing diversity and complexity of businesses in which banks are engaged, the increasingly
sophisticated customer needs, technological innovation, and the expectations for sound risk
management. In this context, there is a need to analyse the essential competencies for current job
functions and to anticipate future skills requirements, with a view to building a competency framework
for banking and finance that is relevant to the changing financial landscape.
The development of an industry competency framework seeks to elevate the level of professionalism
and competence in the banking industry through appropriate training and certification programmes.
For banking institutions, the competency framework will serve as a source of reference and impetus in
sharpening competencies of staff and enhancing organisational capabilities to meet future challenges.
The framework could also provide a benchmark for performance measurement and recognition for
skills improvement. The competency framework will provide the foundation to guide IBBM in designing
and offering relevant management and technical programmes to meet the current and future needs of
the banking industry. In addition, the framework would assist academic institutions in aligning their
curriculum to meet the industry's needs and to ensure a steady supply of graduates in new growth
areas. Competency standards set for certification programmes could also serve as a basis for
evaluating and accrediting training providers to ensure the provision of top quality training. For the
banking workforce, the framework provides a platform for self-assessment to be aware of their
competency gaps, and to engage in continuous learning so as to further their careers and keep in
tandem with the new demands.
The quality of human capital will increasingly become the cutting edge of competitiveness. Having
competent staff to deliver high quality products and services is critical to building customer confidence
and goodwill, driving customer satisfaction, enhancing reputation, and ultimately realising your
corporate vision and strategic goals. It is therefore, in the banking institutions' interests to ensure that
the competence and professionalism of staff in their industry is further strengthened.
The success in developing a robust industry competency framework requires collaborative endeavours
among all the parties involved, based on a common vision of an industry which embraces the values
of continuous learning and development. The industry competency framework is being developed
through a participatory process involving strategic insights and feedback from industry leaders in the
country and the region. Detailed work is already underway, following the executive interviews which
you have participated. Your continued strong support, commitment and contributions will be
instrumental in ensuring the success of the industry competency framework.
With rapid changes taking place in the financial landscape, we need a new generation of professional
bankers who are more customer-centric, technology-savvy, more highly qualified, flexible and agile
with skill sets that are now more comprehensive than previously. As we prepare ourselves for a more
challenging environment, the need to build a competent human capital base with high integrity, right
attitudes and work ethics, as well as to maintain a learning environment could not be overemphasised.
In realising the goals of a progressive and dynamic financial sector, greater efforts must be directed to
building human intellectual capital in a continuous cycle of competency development and
enhancement.
Let me conclude on this note and wish you a most productive discussion session.
Thank you.