Kopi Time E050 Transcript: Piyush Gupta on the Future of Banks, Work, Data Privacy, and Sustainability

Economics & Strategy DBS F lash Kopi Time E050 Transcript: Piyush Gupta on the future of banks, work, data privacy, and sustainability Group Research March 22, 2021 • 50th episode of Kopi time, a podcast series on Taimur Baig, Chief Economist markets and economies from DBS Group [email protected] Research. Recorded on 12th March, 2021. • Youtube link is here. Available also on all major podcast platforms, including Apple, Spotify, Amazon, and Google. Piyush Gupta Guest Speaker Producer: Martin Tacchi Publication support: Violet Lee and Daisy Sharma Please direct distribution queries to Violet Lee +65 68785281 [email protected] Refer to important disclosures at the end of this report. Kopi Time E050: Piyush Gupta on banks, work, data privacy, sustainability March 22, 2021 Welcome to Kopi Time, a podcast series on markets downtime and making every service available to the and Economies from DBS Group Research. I'm consumer at scale around the world was not easy. I Taimur Baig, chief economist, welcoming you to our think banks have benefited from the recognition half century mark. Yes, it's the 50th episode, and we that they were able to support customers through have a very special guest with us. this period. So, I think that's the second positive. Piyush Gupta is Chief Executive Officer and Director A third positive to me is the first cousin of that. I of DBS Group. He has been with us since 2009. Prior think banks, and particularly at DBS, we also to that, Piyush spent 27 years at Citigroup, where his stretched ourselves to find new solutions through last assignment was CEO for Southeast Asia, this period of time. So, stitching up last mile, Australia, and New Zealand. accepting documents digitally, helping companies to digitize their supply chains. All of these were Piyush, a warm welcome to Kopi Time. interesting solutions. Piyush Gupta But perhaps the most important, obviously, is that we were at the core of the fiscal and monetary th I'm happy to join you on the 50 show of yours, policy response that governments came up with. So, Taimur. the government decided to provide moratoriums, the government guarantees, and they decided to Taimur Baig put new money again with government guarantees. Thank you. I want to talk about a bunch of things And because the banks were at the forefront of with you, but let's start with one of the learnings having to make the judgment, do the analytics, but from the pandemic. Agustin Carstens, head of BIS finally dole out the money. Well, you always look wrote around March of last year, just as the good when you're doling out money. And I think economic and the financial gravity of the crisis was there was a tremendous degree of recognition, becoming more evident that banks should be part of therefore, that banks were seen as people who are the solution, not part of the problem in this crisis. providing liquidity, providing forbearance and that's Have they delivered? always a good place to be. So, I think by and large, banks have come out looking quite good. I think frankly, we were part of the solution. Now, there’s Piyush Gupta always a caveat to these things. Well, I think it's fair to say that the banks have come out of this crisis looking and smelling a lot better I think the next year is going to be a little bit more than they did through the 2008-09 crisis, and there challenging for banks. And that's only because, as are many reasons for that. the moratoriums run out and the government programs run out, banks now have to go back to the I think the first is that the banking system is much fundamentals of making choices on who do they healthier. So, banks came out without having support and who do they not support anymore? And themselves a need for bailouts, financial funding, frankly, we owe it to our shareholders to be Central Bank response, etc. In fact, banks were circumspect on our credit decisions. So we will have strong enough to build really large buffers and to go back to people and start calling our loans, will cushions ahead of time. And I think the solidity of have to go back to people and trying to make sure the system, financial system stability engenders a that they are disciplined about payments and that's level of trust. So that's the first, but that is the antithesis of what we've been doing for the last important. 12 to 18 months. So, I do think that there will be a little bit more tension in the system over the next I think the second reason banks are looking good is year as banks start fulfilling their obligation to the because they were very resilient. Banking in a other stakeholder group, which is the shareholders. completely service-oriented activity and for banks to function with everybody working from home at scale, without losing any productivity, any Page 2 Kopi Time E050: Piyush Gupta on banks, work, data privacy, sustainability March 22, 2021 Taimur Baig you have made a subconscious choice to trade off your privacy for convenience and benefits. Speaking of obligations, banks reside on a lot of data. I know that data is very close to your heart and And that is true, particularly with the younger one of the issues that came up during the pandemic generation, if the value exchange is reasonable, they last year was this issue between data privacy and will trade off their privacy. So, I think, I will start with the need to track and trace various aspects. I that. That privacy is not absolute, and people are remember, back in April, you wrote a rather strident willing to trade off privacy for various reasons. op-ed in The Financial Times. I think there are 350 comments on that at the bottom of the article, even Then you come to the bigger question. What are you today, and I was struck by your argument that prepared to trade off privacy for and where does it between balancing data privacy and collective start making sense? And I've always been a big action, “We the people” trump “I the individual.” I'd believer in the fact that there's a trade-off between like you to expand on that. rights and responsibilities. Everybody talks about the Declaration of Human Rights. Few people know Piyush Gupta that in the 50th anniversary of the Declaration of Human Rights, there was a global endeavour to pass I'm not sure if I would call it strident. But yes, it is a a declaration on human responsibilities. That point of view, which obviously evokes a lot of endeavour failed, and it failed principally because of emotions. The way I think about privacy is from two push back from the US. or three dimensions. But to me, this idea that we, as members of society First, remember, and privacy is not an absolute, and human beings have an intrinsic responsibility to privacy is a relative concept and the notion of each other is as important as the fact that we have privacy has changed over time. It is different across a right to ourselves. And when you want to make the cultures. It is, frankly, different across generations. trade-off, there are points in time where the Even in the West, if you go back 1000-1500 years responsibility to each other, the responsibility for ago and you go back to the Roman public baths, society, to my mind, is perhaps more important than everybody bathes together. Everybody swam our own individual right. together. People have common bedrooms. We're all together at night, people raised and reared families In this pandemic, public health was a great case in together. So where did this notion of modern-day point where everybody is suffering. Nobody knows privacy come from? It doesn't go back, deeply who can get infected. If you can use data to try and rooted into the psyche. Actually, in some ways, the triangulate where the problem is, how we can notion of privacy came from the emergence of the actually bring succor to people, how we can remedy photograph. Kodak invented the photograph, and it. What's wrong with that? And so that was the that’s when people started ringfencing, “can you genesis of the article that there are situations and use this image and not use this image?” points in time where public responsibility actually trumps the individual need. So, the point I am making is that it's not an absolute thing. And certainly, in large parts of the world, people are less hung up about the notion of Taimur Baig individual privacy than they are in Western liberal But would you say that in some cases the pendulum countries and democracies. swung a bit too much? And now we're going to see, for example, apps have opt-in as opposed to opt-out The second dimension to me about privacy is that feature? Or that in certain social media space, we're even we in today's day and age are not consistent seeing some backlash that yes, in terms of public about how we think about privacy. We change our emergency, national crisis, wartime efforts, there minds about privacy from time to time. Every one of are certain trade-offs that are more stark. But in day us will say we want to be private.

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