Domestic Institutions’ Regional Efforts

Abstract

Although ASEAN has been in existence now for over sixteen years, the regional expansion of domestic ASEAN financial institutions is still for the most part a relatively new phenomenon. This lack of enthusiasm, though, is understandable, for, as with foreign trade, the ASEAN countries had much closer financial ties with the metropolitan powers (all but Thailand were colonies) than their immediate neighbours. Therefore, when domestic financial institutions were established, they naturally first sought access to the metropolitan countries: representation elsewhere (with the exception of the traditional Malaysia-Singapore connection) rated a much lower priority. As their metropolitan connections were established and ASEAN grew in political if not economic importance, these institutions began to examine ways of expanding their operations within the region. However, owing to regulatory restrictions, their degree of success has been somewhat limited. Because of the differences between institutions, this discussion treats the experience of banks, merchant banks, insurance companies and other non-banking financial institutions separately.