“Our bank has an excellent reputation in the DPRK, both in terms of its long history of successful business, and for the speed and efficiency of its service.” - Interview with Nigel Cowie

Klaus-Martin Meyer: Mr. Cowie you are the General Manager and CEO of the Daedong Credit Bank in Pyongyang . Would you mind to introduce yourself and your Bank to our readers?

Nigel Cowie: Yes of course. I worked for HSBC in various areas from 1984 to 1995, when I was hired by Hong Kong-based Peregrine Investments Holdings, who had signed an agreement to establish a foreign-invested joint venture bank in the DPRK, and needed someone to go and work with the Korean side to help set it up.

We have been operating now for 13 years, and provide regular, western ‘high street’ style banking services in hard currency to foreign businesses in the DPRK. We are not allowed to open accounts for state-owned enterprises or DPRK citizens, so our customer base is almost exclusively foreign, and consists basically of the members of the foreign business community in the DPRK, for whom we provide pretty much the normal range of regular banking services – current and savings accounts, remittances and foreign exchange, deposits, loans and so on. You can find a full description of the bank’s services on www.daedongcreditbank.com.

Our bank has an excellent reputation in the DPRK, both in terms of its long history of successful business, and for the speed and efficiency of its service.

Our local staff are English speaking, and fully trained in banking operations. They have an invaluable knowledge, and hands on experience, of local joint venture procedures, regulations and local ministries, built up over the 13 years of our operations.

Having a resident expatriate General Manager and CEO clearly differentiates us from the competition. Not only in form, but also in substance – my role as an experienced manager and CEO includes a very significant audit and compliance function. Audit covers monitoring all transactions to ensure that our activities and those of our customers are fully legal, and that we are always able to provide complete documentary evidence of this at any given time. Compliance comprises keeping abreast of international practices in the field of audit and reporting, anti-money laundering and KYC (‘Know Your Customer’) procedures and requirements.

On that last point, we were I think the first bank in the DPRK to introduce a comprehensive, written, anti-money laundering procedure manual which is regularly updated and read and understood by all bank staff.

The bank has a significantly strong position; in relation to the future economic development of the DPRK, and it is the oldest established foreign invested commercial bank in the DPRK. It is our intention to capitalise on these advantages.

I am also a director of Phoenix Commercial Ventures Ltd, a venture capital company specialising in incubating startup joint venture projects in the DPRK.

Klaus-Martin Meyer: You have held the position as the General Manager and CEO since the start up of the bank in 1995. What are in your opinion the most important milestones in the history of the bank?

Nigel Cowie: There are many, but I’ll just pick a few here, beginning with the bank’s establishment in December 1995, as Peregrine Daesong Development Bank. The first few years after that were pretty hard work as we built our initial experience. Then in January 1998, Peregrine, the majority owner of the bank and the company that hired me, went spectacularly bankrupt. Because nobody knew what was going to happen, in one day our customers withdrew all their balances. However, our staff were able to pay them out in full, in cash, on the same day, so the bank emerged from this incident with its reputation enhanced. There was a theory at the time that the DPRK operation was indeed the only part of Peregrine to remain solvent and continue operating.

As a separate legal entity from Peregrine, we continued successful operations, with the liquidator of Peregrine as the foreign partner, for two years, until there was a transfer of ownership and the bank was renamed Daedong Credit Bank in 2000.

Klaus-Martin Meyer: What are the most important differences of leading in bank in Pyongyang or in London or Frankfurt?

Nigel Cowie: I have held a number of banking positions around the world. Thene thing I have learned is that everywhere is different. There are different legal requirements, market practices and procedures and cultural sensitivities everywhere. As an expatriate, you need to learn and understand these as quickly as possible, observe them and be able to explain them to people who are not familiar with the market – people such as bank customers, potential investors, journalists, regulators, even shareholders.

One example in this area is the widespread use of cash. There are specific economic and practical reasons for this, which, for example, people from former socialist countries understand very easily. However, people from capitalist countries do not use cash; they often take the view that if people are dealing extensively in cash, it must by definition be illegal. In reality, it is because for various reasons (and I would be happy to explain these separately), there is no alternative to using cash.

Klaus-Martin Meyer: At the moment a lot of companies are heading for Kaesong . How important is the development of this new industrial site for your bank?

Nigel Cowie: It is not that important for us, we are concentrating on providing banking facilities for foreign businesses in Pyongyang – Kaesong is not really our area of business.

Klaus-Martin Meyer: What are your plans for the bank’s future? How do you see your bank in five years time?

Nigel Cowie: As business people, we don’t get involved with matters political, on anyone’s side – ever. Having said that, we do have to be aware of the climate. I am very confident that the economic situation will improve, and that will be of benefit to the bank.

We will grow and flourish as the economy grows and flourishes, whether as an independent bank or as part of an international banking group.

Stichworte: Daedong Credit Bank Nigel Cowie