"Inspiring Excellence, Celebrating Distinction, Raising Competencies in the Financial Sector" - Speech by Mr Lawrence Wong, Acting Minister for Culture, Community and Youth; Board Member, Monetary Authority of Singapore at the FICS Distinction Evening on 28 May 2013
Ladies and Gentlemen
1 I am very happy to join all of you for the FICS Distinction Evening.
2 Let me first offer my heartiest congratulations to this evening’s award recipients. Ten individuals will receive the Distinguished Financial Industry Certified Professionals (DFICPs) title – this is the highest certification title under the Financial Industry Competency Standards, and it represents a commitment to high standards of professional competence and excellence. We are also recognising the Friends of FICS tonight – the financial institutions, organizations and individuals who have put in continuous effort and commitment in human capital development. Congratulations and well-done to all of you.
3 I’ve always had a great affinity for the financial sector, because as a student many years ago, I had thought about pursuing a career in finance. I did Economics in university, but my focus was on Finance, and I remember taking all the classes offered in the Finance Department, and then going on to do the CFA exams after that.
4 When I completed my studies and returned to Singapore, the PSC interviewed me to see what job I should do in the public service. They asked me what I had done in university. I told them that I had worked on an econometric model to predict stock market returns. I’m not sure if they completely understood what I had done, but they decided to post me to MTI to help develop and run their GDP forecasting models. The year I started working in MTI was also the year of the Asian Financial Crisis. All my economic projections turned out to be wrong! So on hindsight, it’s probably a good thing that I did not continue on as a quantitative analyst, and found a different calling in the public service!
5 All this happened more than 15 years ago. Over this period, the financial sector – both globally and in Singapore – has undergone rapid changes. Financial products and services have become more complex, and regulatory regimes have become stricter. The materials I used in college and in the CFA have probably been updated many times over.
6 What this means is that technical competency and the continual upgrading of skills have become even more critical for financial sector practitioners. All practitioners must make it their mission to upgrade their personal competency, and stay abreast of global developments. Likewise, a fresh hire and new-entrant to the financial industry must understand that academic qualifications alone will not make him or her desk-ready and employable. Cross-functional adaptability, global and regional exposures, strong leadership and soft-skills – these are all qualities that financial professionals today must arm themselves with.
7 With more complex products and more sophisticated customer demands, we will need more skilled professionals to support our financial sector. A recent HR survey revealed that one out of two financial leaders in Singapore found it “very challenging” to find skilled financial professionals. Half of those surveyed said that they were “very concerned” about losing top performers. Singapore actually came out number one in the survey, in terms of having the highest level of concerns for manpower recruitment and retention.
8 These are the realities all of you face. So we need to ask ourselves hard questions on our state of preparedness in dealing with the changes in our financial sector – Do we have the scale to compete regionally and globally? Is our financial sector workforce sufficiently competent to meet not just domestic needs, but also serve the region and the world?
9 At this same event last year, DPM Tharman had shared the Government’s plans to work with the industry to build a pipeline of Singaporean leaders in the financial sector.
10 Why are we doing this? Because we want a strong core of homegrown financial specialists and leaders – a pool of Singaporean talent who are committed to our nation’s development, who are passionate about our country’s success, and who will help us develop our value proposition as a premier financial centre.
11 This evening, I will share additional plans that the Monetary Authority of Singapore (MAS) and the IBF have put in place to raise the overall competency of the financial industry. These are:
- One; to enhance the FICS framework for better alignment with industry’s evolving needs;
- Two; to develop a new programme to upskill Financial Services IT practitioners; and
- Three; to strengthen Singapore’s financial sector training landscape.
12 Let me elaborate on each of this in turn, starting with enhancements to the Financial Industry Competency Standards (FICS).
(1) Enhancing the FICS Competency Framework
13 In 2005, IBF launched the FICS as the overarching architecture for industry-wide competencies. This was in recognition of the need to clearly define the core competencies required for different financial services specializations. Under the FICS, IBF accredits programmes offered by training providers which are aligned with the Standards. Financial institutions draw assurance from hiring an FICS-certified practitioner as being one who has passed the necessary industry assessments.
14 It has been nearly 10 years since FICS was introduced. Last year, IBF conducted a milestone check to ensure that FICS remains relevant for the industry. I believe all of us would agree that in a rapidly changing financial landscape, the FICS must remain the bellwether for the industry, and maintain the high standards of competency expected of every financial services practitioner. Moreover, with the financial industry admitting thousands of new entrants every year, it is no longer sufficient to just provide “on-the-job” training – there is an urgent need to ensure that new entrants undergo structured training and acquire basic competencies before they are admitted into the industry. It is also important that the FICS be broadened to tap on the knowledge and experience of industry veterans.
15 So with the help of PriceWaterhouse Coopers (PWC), IBF met extensively with the industry over the last year, and undertook a review of the first set of priority segments comprising: Compliance, Corporate Banking, Life and General Insurance, as well as Wealth Management. Taking into account the feedback from this review, IBF intends to make the following enhancements to the FICS framework:
i. First, the FICS certification levels will be streamlined to better reflect the career progression and competency development pathways for a financial practitioner. The FICS certification framework will now be recalibrated from the previous six certification levels to four certification levels. This will reflect competencies at Foundation, Intermediate, Advanced and Expert levels.
ii. Second, fresh graduates and career-switchers with no prior experience in the financial sector can now be certified under FICS, as long as they undergo foundation training and assessments. IBF will be working with four training providers to introduce new programmes targeted at this pool. These providers are the International Compliance Training Academy (ICTA), the Wealth Management Institute (WMI), the Financial Training Institute (FTI)@SMU and the Swiss Asia Banking School (Asia). On behalf of IBF, let me acknowledge the efforts of these providers for their commitment in developing new foundation programmes for the industry.
iii. Third, the IBF will work with industry veterans to better capture their invaluable experiences through FICS case-studies and training resources. The FICS will also be revised to allow senior experienced executives with more than 15 years of experience to be certified based on peer-review of their industry contributions rather than formal assessments.
iv. Fourth, the FICS Standards will be updated to be aligned with the revised certification levels. The revised standards will better define the core competencies required at the different levels and give clearer guidance on the performance criteria that a certified professional should fulfil to demonstrate his competency.
(2) Developing Structured Training to Upskill Financial Services IT Practitioners
16 Next, training for the financial services IT professionals. Singapore’s ability to remain globally competitive as a premier financial centre lies in our ability to derive synergies through the use of more advanced technology. The financial industry has always leveraged heavily on IT as an enabler for its business operations and delivery. So our IT professionals must enhance their skills and capabilities to keep pace.
17 Today, the IT professional in the financial sector will need not just IT knowledge, but also stronger understanding of the business needs and processes of financial institutions and a sound understanding of underlying financial products and market developments.
18 I am pleased to announce that the Infocomm Development Authority of Singapore (IDA) has partnered with the MAS to appoint the Singapore Management University (SMU) as the Lead Provider to design and deliver quality training programmes for the financial services industry. The new Financial IT Academy@SMU will offer programmes targeted at both the financial and IT industry.
19 IT professionals can look forward to programmes that will equip them with technology, software and systems skills. There will also be modules covering new technology skills – to provide state-of-the-art capabilities for analytics, mobility, social media applications, information security and other key emerging technology capabilities. The programmes will support all the major segments of banking, and will be accredited under IDA’s National Infocomm Competency Framework (NICF) as well as the FICS.
(3) Strengthening the Financial Sector Training Landscape
20 The third-prong of our initiatives focuses on the need to strengthen our financial sector training landscape and ensure that we admit only quality financial sector training providers.
21 The Financial Sector Development Fund (FSDF) has always provided subsidies to support financial institutions in sending their staff for generic financial sector training programmes through the “Financial Training Scheme” (FTS). Currently administered by the MAS, the FTS incentivises continual development of the financial sector workforce in niche and growing areas that may not necessarily lead towards certification under the FICS. FTS has been widely utilised by the industry – close to 400 financial institutions across various segments tap on the FTS scheme each year.
22 The MAS has been receiving industry feedback on ways to improve the FTS scheme. FTS was primarily structured as a means to encourage financial institutions to undertake more training. Unlike FICS, there is no formal accreditation or endorsement process. So one feedback is that it would be useful for a central administrator to review the quality of FTS providers.
23 MAS recognises this, and so we have decided to appoint IBF as the overall administrator for both the FICS as well as the FTS schemes. This provides a vantage point for IBF to ensure comprehensive oversight of the financial sector training landscape. As a first step, IBF will be introducing a new recognition framework to recognise providers and programmes eligible for FTS subsidy. This will also allow for a more transparent and efficient process for the industry in seeking FTS support.
24 Overall, the FICS will continue to be the linchpin for financial sector training in Singapore, with its emphasis on full-fledged structured training leading towards formal certification. FTS will then offer the complementary suite of ad-hoc training to support the structured programmes offered under FICS. Besides providing the industry with greater clarity, these enhancements will allow financial institutions to better plan their staff’s training needs. It will also drive more efficient use of FSDF funding support to plug competency gaps by funding only direct training costs, rather than being extended for ancillary costs. MAS will release details on the changes to FTS and FICS shortly.
25 I have shared some of our thoughts on the financial sector training space and how we intend to develop manpower capabilities across all levels in the financial industry. As the global financial landscape changes, Singapore’s financial sector will inevitably be affected. Singaporeans working in this sector must equip themselves with the relevant competencies to keep pace with the industry’s changes. Continuous education and lifelong learning must be part of every financial professional’s career development roadmap.
26 MAS is committed to help you in your training and development needs. We will continually enhance the training landscape for the benefit of our Singaporean professionals. At the same time, all financial institutions based here must also engage in proactive people development. It must be ingrained within the organizational mindset to develop and progress every individual. The MAS and the IBF will be your key partners in this journey. Whether it is through the FICS or FTS route, let us have your plans to groom our homegrown talent and build up the capabilities of the financial sector.
27 As markets evolve with time, as products and technologies get replaced, the ability to continually enhance our competencies will be our core advantage. This means stronger business innovation and continual upgrading of our skills. Let us build on our strengths, and work together to develop a strong core of Singaporean financial specialists and leaders, who inspire excellence and professionalism, and who will ensure the long-term success of our financial sector.