TAIPEI   

KOO Family

CHINATRUST dynasty

 

Andre Koo
Executive Vice Chairman, Pacific Media Plc

Mr. Andre Koo is a member of Taiwan's Koo family group, a leading family controlled conglomerate based in Taiwan. He is also the Chairman of the Chailease Group, a leading financial services group in Taiwan specialising in leasing businesses in Asia. Mr. Koo is a respected and well-known business figure with a wealth of experience in the financial industry in Greater China. He has also held senior positions with China Life Insurance and Chinatrust Hotels. He received his Bachelor of Arts and MBA from New York University, Stern School of Business.

Jeffrey Koo (辜仲諒)

Jeffrey Koo, has an MBA from the University of Pennsylvania’s Wharton School is also a former fashion model,

WALL ST. JOURNAL    2009  June 15

The business of lending to small and medium-size enterprises, a sector that has been hard hit by the worldwide recession, has not had an easy go of it lately.

But discipline, integrity and passion for managing employees can make the difference between surviving and not surviving the storm, says Andre Koo, executive chairman of Taiwan's Financial One, which specialises in such lending.

“The global financial crisis and economic downturn have created difficulties in areas such as business growth and asset quality," says Koo, 42. "But what I tell my employees is that this is the time to learn from this environment, be driven by integrity and discipline, and try to grow steadily. That's all I want.”

Mr Koo has managed Financial One, which makes the bulk of its asset-backed loans and direct financing to small and medium-size businesses in Taiwan, since 2003. Along with his father, Jeffrey Koo, chairman of Chinatrust Financial Holding, one of Taiwan's largest financial services groups, and another investor, he owns 66 per cent of the Singapore-listed company.

Last year, Financial One posted $US244.8 million ($300.8m) in operating income, but it reported a net loss of $US1.2 million on increased provision for its US portfolio, swinging from a net profit of $US37.6 million in 2007. The firm, with total assets of $US2.73 billion as of December 31, operates in Taiwan, China, the US, Thailand and Vietnam.

Financial One recently entered into a partnership with Bank of China, one of the mainland's four big state-controlled commercial banks, under which the Chinese bank will provide lines of credit to small and medium-size enterprises in China through the Taiwanese firm, which employs about 1600 people worldwide, including 100 on the mainland. Mr Koo says the partnership was a natural step for the company, which focuses on "serving its clients with passion".

"That's our slogan and that's why I emphasise the well being of my employees. If I can't service my staff with passion, how can they go out and service customers with passion?" he says.

"For me, everything boils down to the people. It's important for a manager to understand his employees, to show that you really care for them.

“Small gestures matter, like remembering their birthdays, making sure they are happy at work. It isn't about squeezing every penny out of your employees."

Mr Koo, whose family's fortune is among the fifth largest in Taiwan, has a bachelor's degree and a master's in business administration from New York University. During a visit to Singapore, he sat down with Patricia Kowsmann for an interview, which has been edited.

WSJ: What was your first job and the biggest lesson you learned from it?

Mr Koo: My first job was as an assistant lending officer at the New York branch of Chinatrust Bank (a wholly owned subsidiary of the Taiwan group), responsible for preparing credit applications and appraising collateral. I learned from the job that extensive due diligence on the borrowers and their collateral is critical to the lending business. There is no shortcut to ensuring that you are making the appropriate credit decision.

WSJ: Who gave you the best business advice?

Mr Koo: My father told me to always treat my colleagues with respect, keep up the teamwork spirit within the company and have good communication with my staff.

WSJ: What advice would you give someone starting out in your field?

Mr Koo: Don't be in a hurry to try to achieve everything all at once. Spend the time to build good business fundamentals.

WSJ: Do you have a favourite business book?

Mr Koo: My favourite is Good to Great: Why Some Companies Make the Leap ... and Others Don't, by Jim Collins. The book helps me think outside of the daily operations and keep focus on sustaining the core strength of my company, which is discipline. As a lender to small and medium-size companies, we have comprehensive rules on credit review and have developed a decision-making process to control our risk exposure; we make it mandatory that all our credit officers follow the rules without compromise. Findings in Good to Great show the importance of discipline to companies, and I can attest personally to that.

WSJ: What are you reading now?

Mr Koo: I read the Harvard Business Review regularly and now spend more time reading Chinese journals on the economy of China and its financial industry. Chinese journals provide a unique analysis of political and social aspects of some economic developments and government policies.

WSJ: What's the one thing you wish every new hire knew?

Mr Koo: I wish they knew that integrity is the core value to have for working in the financial industry.
WSJ: In your industry, is there a difference between Asia and the rest of the world?

Mr Koo: Establishing trust is more important in Asia than it is in the rest of the world. In most cases, you have to earn the trust before you can do business. And it is mutual, because you are not supposed to do business with people that you don't trust.

WSJ: What was the toughest decision you have had to make as a manager?

Mr Koo: The toughest decision I made was to push for the re-engineering of my company in 2000. At that time, we were already a company with more than a 20-year history, and we were the dominant player in our business. It was very difficult to convince a group of senior executives that we needed re-engineering to overhaul the organisation, when the company was still performing well.

WSJ: And the most satisfying decision?

Mr Koo: It was the same decision, to push the company's re-engineering. By the time we completed (the overhaul), the company had doubled its assets in four years and built an effective credit-review system that helps us keep delinquency rates low in our lending business to smaller enterprises.

WSJ: In your opinion, what are the three prime attributes that a good manager should have?

Mr Koo: The most important is discipline. Without discipline, there is no productivity. The second is integrity. Integrity ensures the alignment of value and interest of the manager and the company. The third is passion about the work that you do. Without passion, there is no devotion.

WSJ: What lessons have you learned from the current global economic crisis?

Mr Koo: Be sure to always stay on top of things that might hurt your company. Stay alert. Assess the business environment with a grain of salt and don't be too optimistic.       2009 June 15   WALL ST. JOURNAL  

 


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