How Malaysia’s Affin Hwang is harnessing data analytics

Like many established financial institutions, Affin Hwang Asset Management is facing the heat from financial technology (fintech) startups that are nimbler in meeting the needs of retail investors.

In response, the Malaysian firm has been doubling up on digital transformation efforts, particularly in data analytics where it has built up a data analytics team to improve customer experience.

“We’re in the infancy of data analytics,” said Allen Woo, chief innovation officer of Affin Hwang Asset Management, adding that the firm has accumulated a modest amount of data from various customer touchpoints such as chatbots to better profile its customers.

At the same time, the firm is working with third-party fintechs and facilitating new services using application programming interfaces (APIs) that are being managed using Tibco’s Mashery API management platform.

“Some fintechs have come to us with nice user experiences and we’ve partnered with them to acquire certain segments of customers that we don’t typically go after,” he said, adding that such segments can be surfaced through data analytics.

While these efforts have had some success, Affin Hwang’s data analytics journey is not always smooth sailing. For one thing, it had to grapple with back-end systems that operated in silos, resulting in challenges in batch processing where data was moved to a data warehouse.

Woo said cumbersome batch processing tasks had affected how soon the firm could release prices for investment products. “In our industry, we got to do our pricing daily and it’s a sensitive thing because you can’t have your funds without pricing.”

Earlier this year, Affin Hwang starting using Tibco’s data virtualisation tool to provide real-time access to data while minimising complexity and cost by making it easier to move data into a single source. With the tool, large data volumes from multiple data warehouses can also be combined into a single view and quickly analysed or turned into a report.

Asked about the implementation experience, Woo said Tibco has been guiding his 30-member team since the firm started rolling out the API management platform. “Knowledge transfer is very important and hence we’ve continued to work with them in other products,” he added.

Being a financial institution, Affin Hwang is also required to comply with strict governance, risk and compliance rules. Woo said the firm’s compliance team regularly reviews how data is being used and stored, and what data can be shared.

“We review our policies every six months, and nothing has been flagged up so far,” Woo said. “I believe our processes are quite robust.”

Affin Hwang’s data analytics initiatives are already paying off with a 45% increase in the number of sales leads, a business outcome that Woo deemed as “pretty substantial”.

For now, the firm is not monetising its data as it sees itself more as a specialist in investment products. “The data we have is also subject to regulation and governance, and perhaps should not be monetised. So, rather than push the envelope at this stage, we’ll probably be on the safer side,” Woo said.