Recently, DBS Bank announced that it will be transferring its retail equity trading under DBS Vickers to the bank by the end of the year.
By taking over the business of remisiers, who are self-employed trading representatives, and with nary a mention of compensation for these people who may be losing their jobs, DBS bank demonstrates the "let's move on" attitude that is taking hold in Singapore.
DBS is also setting a bad precedent for the rest of the industry, leaving several other thousand remisiers living in fear of losing their jobs too.
Token compensation, if offered, would add insult to injury.
Under the principal-agent relationship, remisiers bring in clients, who then become mutual clients of the bank. Revenues are already split 60 per cent to 40 per cent in the bank's favour. Bearing in mind that this is an annual revenue stream, to now effectively demand 100 per cent control and totally deprive remisiers and their families of their rice bowl goes beyond business bona fides.
DBS must not only buy over the remisiers' ongoing businesses at an arm's length price. It must also honestly assure remisiers who choose to move to another broking house that they will not be discriminated against via unreasonable costs, recovery charges or have their business rebuilding efforts thwarted in any way. It is the least DBS can do for a band of people who have stuck with it through thick and thin, from the days of the Pan-El crisis, the Malaysian Central Limit Order Book saga, the Internet bubble crash, the 2008 global financial crisis and the current moribund stock market.
It is not too late for DBS to do the right thing by these remisiers, a significant percentage of whom are in their 60s and have been doing this job for many years, and will be hard-pressed to reskill and find jobs in competition with unemployed professionals, managers, executives and technicians.
Loh Kin Poh