Thanks for joining us for our third installment of these deep dive sessions. The objective of which is for all of you to get to know our business better, importantly, to get to know our key managers better as well. We thought that that little marketing warm-up was a good place to start because, obviously, I will say this, it's by design that we identified that we've made some good progress. We have a lot further to go. We know that. We do think that we've laid the foundations for really good, healthy underlying growth in all of our markets. Today, we're talking about retail. We're talking about retail because it's an extremely valuable business for our bank. It's a core business for our bank. It's one that we've been in from the beginning of time, although obviously, it's evolved substantially.
When I look at the way people describe Standard Chartered when I first arrived, it was often referred to as the wholesale bank with a little bit of a retail tag on. I looked at it and said, "That's an interesting way to describe it," because actually, what I see is a profitable retail business with a black hole on the corporate side that is sucking and destroying value at a tremendous rate of pace. Obviously, we've addressed that. You heard from Simon a year ago. We've got very concrete plans to get that C&IB business. Simon has subsequently added responsibility for the commercial banking business to his portfolio. The corporate business is under Simon. We've done, I think, a lot of work to get that business to the point where it's poised to create value for shareholders. Not quite there yet.
We have a very clear plan on how to get there. The retail side of the business is already creating value for shareholders. Especially when we look at our key markets, where we've been strong for quite a while, the returns and growth are both outstanding. The objective today is for you to become more familiar with this business. Many of you are quite familiar already, but you'll get the color of also seeing the management team in action. The host for today, the chaperone, the driver, is Ben Hung. You all know Ben. You heard him talk about the Greater China, North Asia region last year, which clearly has been a very strong producing and performing component of our portfolio. You'll meet the rest of Ben's team. Ben in the retail role is relatively new.
Ben stepped into this position at the end of last year when Karen Fawcett retired. Ben has shaped up the strategy and is shaping up the team. It's a work in progress, as you'd expect. We had a debate earlier in the year. Do we want to have this meeting in May, before we've rolled out every bit of change that Ben might want to roll out, or do we want to get on with it and talk about this as we're evolving the execution of the strategy? Obviously, we've chosen the latter, and for good reason. What you can expect today is to see something that is marking the evolution of this business over the past couple of years that Karen, with the team who you'll see today, and all of them to one degree or other, have dutifully led.
You can expect to see some more evolution as Ben puts his imprimatur on this business, as we learn what we learn and as we discover what we discover. Bottom line, we think we have some key differentiating advantages in our retail business. We have a very strong brand in most of our markets. It's an aspirational brand in most of our markets. Not all, and we can talk a bit about that. We think we have a wealth management proposition that is differentiated, one, by the fact that we're substantial in these markets. Second, by the fact that we're open architecture/objective. We're not manufacturing our own wealth management product. We're identifying and sourcing what we think is best in market. We're delivering that to our clients in what we think is an objective way. It differentiates us from a number of our competitors.
We have key synergies with the rest of the bank. There are obvious funding synergies and capital synergies. In some cases, more importantly, there's client synergies. As Ben will go through, a significant proportion of our new to bank affluent clients are coming through employee banking arrangements, where we have an undertaking with our corporate clients for them to effectively steer their employees to Standard Chartered Bank. This is a great area of growth for us. Likewise, in partnerships, et cetera. You'll hear about that in a lot more detail. We also know, per our friend, Usain Bolt, that we're not fully there yet. Somebody is going to go faster in this organization, and we think that the people going faster will be the people that you'll be hearing from today. We are not yet world record holders. In fact, we're quite away from it.
We're not as efficient as we need to be end to end. We're not as optimal and optimized in terms of our funding mix and our generation of liabilities as we need to be. We don't have all the talent that we'd like to have, and we aren't as digital as we'd like to be. We have good foundations in each of those areas, and it's along the lines of that recognition that we get really excited about the prospect for this business. Going from a cost of capital plus a bit return now to a real outperformer that's generating good, strong underlying growth. We see tons of low-hanging fruit, if we can call it that, or upside, more specifically. With that said, I will turn it over to Ben, and I'll be around with Andy and José and others from our management team.
We've got Michael Gorriz running Tech and Ops. Jason Forrester, I see, who runs compliance, corporate affairs, et cetera. You've got a number of our management team colleagues together with IR. I see a couple of non-executive directors as well. Jasmine Whitbread and Pam Walkden, our Head of HR. Please engage with us fully and extensively over the course of the day. The intention is to be as informal as possible to get to the things that you want to talk about. Thank you.
Thanks very much, Bill. Thanks very much for joining us this afternoon. I think I have met a lot of you, but in case we haven't met, my name is Ben Hung. I run the retail and wealth management business for the bank. I am also the regional CEO for Greater China and North Asia. This is my 26th year with the bank. I've done a lot of different roles, but the retail business is actually, to me, it is very exciting business. It is a better returning business. It uses a lot less capital. It produces stable, sticky, and deployable liquidity for the bank, and it also produce a less volatile income stream. As Bill said, this business is already delivering a return on equity in excess of 8%, but we do believe there is more to be had in this business.
Now, let me turn to slide four, okay, which is the retail banking investment case. There is a few factors here I want to highlight. Number one is we are in very attractive footprint. Effectively, all of our businesses are in the dynamic markets of Asia, Africa, and the Middle East, where the revenue pool is expected over the course of next decade to double. We also have very strong distinctive differentiators, particularly, as Bill said, we believe we have a very strong wealth proposition, which is where the brand that we stand in many of the markets resonate the most with our clients. We are already recognized in seven out of eight top markets, where we are seen to be the best of best-in-class in terms of international bank. We do have a clear strategy, a strategy which we believe is already delivering results.
Markets where account for two-thirds of our income in aggregate, these markets are already delivering an ROE in excess of mid-teens. We are working very hard for the rest, really underpinning by our continued pivot towards affluent and emerging affluent segment. Finally, we are investing in our future. Many of our efficiency save initiatives have afforded us to invest in excess of, or roughly around $1 billion in cash over the last four years, primarily focused around improving our digital wealth and infrastructure platform, and these investments are already delivering improvement in our client experience. If we take all these factors together, we are confident that this business is capable of delivering a return that is in the mid-teens over the medium term. Okay, this is our investment case. Slide five is really what you will be hearing from us today.
As I meet many of you investors, I get usually a few questions. Number one usually revolves around why should clients bank with you? What are your differentiated proposition? I also get a fair number of questions around, are you subscale in many of our markets? How do you compete with local players? I also get asked, how comfortable and confident are you in ability to drive down your cost income ratio? Finally, it is always around, how does technology play? Will they disrupt you? Will they disintermediate your business model? Hopefully, over the course of today, we will get some of these questions answered. I do have a management team here sitting there who can add towards whatever that is not being covered afterwards. Now on page six is essentially who we are, okay.
As a retail business, we have around 9 million active clients, across 30 markets. Roughly 2 million of the 9 million are in the segments of priority, premium, and business segments. These three segments combined actually account for around two-thirds of our income. We have around 1,000 branches across our footprint, with around 30,000 staff. If you look at the makeup of the products, it's a well-diversified set of products, but it's actually each of these products sort of draw and support one another in terms of as a client segment proposition, led by wealth management at 30%, followed then by credit card, personal loans, deposits, and mortgages. If you look at it from a geographic lens, the biggest slice comes from Greater China and North Asia.
There are also a lot of large and exciting markets both in ASEAN and South Asia and Africa and Middle East, where directionally it should provide a very good source of income diversification for our business going forward. Now, coming back to the question of why do clients bank with us? There are three main reasons we see it. First, and perhaps the most important is we are a well-trusted brand. In many of our markets, as you know, we are established for well over 100 to 150 years, and we are very much a well-known and well-respected household name in all these markets. This very international brand, coupled with the local heritage, actually provides a very strong appeal to the segments we want to focus on.
Second, we have a very strong customer value proposition, particularly around us being that international provider as a trusted advisor and providing a very good platform to help our clients in terms of their wealth and asset diversification needs. As Bill mentioned, we are truly an open architecture unbiased provider because we are not engaged in any form of product manufacturing, not in bancassurance, not in fund management. So customers like our objectivity, like our unbiased support and advice. Third, we have been investing quite heavily in the areas of digital and product proposition, and customers are also responding very positively to our relationship management approach.
Taking all these together, I think we are increasingly being recognized, and that's being shown on the right-hand side in terms of Net Promoter Score for our priority clients, and they are seeing us as being that very top international bank provider in the seven out of eight markets as we highlighted here. Then, moving to slide eight is around technology. Naturally, technology is changing the way our clients interact with the bank. As you would expect, people use our branches less, and they will use our non-physical channels through digital, through online, a lot more. As we speak today, roughly 90% of our clients interact with us through either online, mobile, or ATM. Okay? We expect that to continue to go up. Technology obviously is affecting the entire industry.
We do see both challenges and opportunities, and we're well cognizant and well aware of the risks of new entrants, be it a fintech, a platform player, in terms of how that evolves into our footprint. From our standpoint, we have to make sure we invest heavily into customer touch points and omnichannel experience, to make sure that client journey is being well-served. From our standpoint, branches still have value. They are particularly of value in terms of their higher value, more complicated advisory solutions. We do see the value of that. We will be rolling out a brand new configuration of branches globally, which will turn us into more versatile, more efficient, less service, but more advisory-oriented type of configuration. We're rolling that out. We are shifting a lot of the servicing type, the solutioning orientation towards our contact center.
Most importantly, we are investing into digital, hopefully to both have an end-to-end solution in terms of client origination as well as end-to-end service fulfillment. These are some of the areas we're investing heavily. We are also very aware that local regulations in each of our markets play a very important role in terms of how markets play in terms of the whole digital space. We are operating closely also with fintech, big tech companies, to make sure that we stay close to what's happening on the ground in terms of local regulatory environment and make sure that we are in the game of the digital world. The right-hand side, simply we're in early stage, but we do see some very encouraging results in terms of what we've been investing in and some of the output that's been coming out.
Turning to page nine, I tried to put here some of the cornerstones of our strategy, which was laid back in late 2014. Fundamentally back then, we had a business which was more focused around unsecured, sold through third-party sales channel, towards pivoting towards one that is more focused around wealth, deposits, and targeting towards the affluent segment. I'm quite happy to show in each of the five core pillars of our priorities highlighted then, that there has been very positive progress. Starting with priority client segmentation, we have been seeing very good CAGR growth in priority segment clients, which it's being highlighted here. It went up from, used to be 27% of our income deriving from priority segment, now it's 45%.
We have done a huge amount in terms of cost efficiency, whether it's through headcount, whether it's through number of branches, whether it's through square footage. That has come down by approximately in the neighborhood around 20%. We are redeploying these efficiencies to invest in digital, as I talked about, and we will cover more shortly in the later slides. We have also reset our risk tolerance. We have brought back some of the perhaps over-concentrated concentration in unsecured. Now we are in a much better shape now. We are starting to resume targeted growth in this area. The last bullet, last point is, we did highlight back then we do have some more challenging markets.
I would be quite happy to report that in the two markets that were highlighted back then, which is in Korea and China, we have shown significant improvement in terms of the losses that were incurred back then. It was roughly losing around $370 million back then in 2014. Last year, we brought that loss down to $17 million. We have more market to work on, but at least it's a good demonstration that we are focused at it. We have that capability to turn around some of the more challenging markets. On slide 10 is a very quick summary of our financials over the last four years. I must say, the headline numbers as you see, mask exactly what I was describing, the underlying progress that we have been delivering underneath these numbers.
This business now, particularly in the income and the mix in the client segment, is of a far higher quality, more sustainable, and more focused around the areas that we have a competitive advantage in. The cost remains flat despite accommodating a very significant and substantial level of investment in our businesses. The cost of risk impairment has also been brought down. As you can see, we are now using a far lower level of RWA, and therefore capital, to generate the same level of profitability. We do believe after securing these foundation steps, we are now poised to drive further improvement in returns through better and higher quality growth in income and profit in starting 2018 onwards. Slide 11 is a slide that I borrowed from Simon Cooper's CIB day, which I shamelessly copied.
These are the six, I would say, ingredients or components, through which we believe we have the capability to drive better return. I cover them one by one briefly, starting with slide 12. Okay? As I said, we are in very exciting and dynamic markets. This chart shows the amount of wealth that is being created or will be created. There will be, over the next decade, 2 billion of population joining the middle class. We estimate that the banking wallet derived in our market will go from $750 billion to one and a half trillion, primarily driven by the affluent and the emerging affluent segment. The population that we are serving will be shifting from saving to investing, and therefore, that inherent need for wealth management advisory solutioning will increase.
That really underpins why we are pivoting our business strategy to capture this very macro and structural shift in terms of wallet size going forward. We believe we are making sure that we are well-positioned to capture this macro shift. Next couple slides are important ones as this shows how and where we are choosing to compete. Okay, let's first take a look at the segment lens. Okay? This highlights the four segments that we are now serving, starting from priority, premium, personal, and business. Priority is a segment that we believe is where our proposition, our brand resonates the most with our clients. Not only, as you can see, is this segment producing a far higher income per client, the quality of that income is also a lot better. 80% of that income is coming from wealth and deposits, which is not capital intensive.
You can deduce that this is actually a very high returning from ROE standpoint segment that we are very keen to pursue. The premium is equally important because this represents the feeder pipeline towards our priority. As you can see, they are going through a different stage in their life cycle where mortgages, they are probably in the stage of home building, et cetera. That's why mortgages is actually the biggest wallet. We are, this year, planning to launch a new premium proposition across seven markets in our footprint, in our core geography, just to make sure that we're well-positioned to capture this emergence of affluent segment. The personal is by far the largest in terms of number of clients. By personal, the way we look at it is this would be the kind of upper mass segment.
If you look at a product perspective, it's predominantly the revenue coming from credit cards and personal loans. This is the area where we have done quite a bit of review around our risk appetite and risk tolerance. We've done our portfolio review. We are actually now in a far better position after a couple of years of that de-risking, and we are now poised to grow. The way going forward is we're very keen to use digital to acquire, to serve, and we are also very keen to use this as a filter towards ensuring that we capture the future emerging affluent segment. That is around our personal clients. Lastly, business segment is also a very good segment. It is primarily liabilities-led. It produces a very strong liquidity provider.
It's a low RWA ratio, and it also feeds very well to the overall bank's ecosystem and supply chain. That's also a very important segment. If we put everything together, I'll be very clear that, to my team as well, that, look, we cannot be all things to all people, and we do not intend to be all things to all people. In markets, in geographies where we have good market share, including likes of Hong Kong or Singapore and many of our African markets, we're quite happy to address or focus on a wider piece of that segmentation, all the way from priority to personal business.
In markets where we have less market share, less relevance, less scale, then we have to be sharper in our focus, have a stronger pivot towards the emerging affluent, and a stronger usage around digital to make sure that we have a lower cost to serve. This is the segment lens I'd like to share with you. This slide on page 14 is really a reflection of progress around that pivot, which, as I said earlier, the priority segment has come from 27% to 45%, which if you include the premium, it's around 55% of our income. They themselves then generate a higher quality of income on a product basis. Again, the wealth and deposits accounting for 56% of our income. These are non-capital consuming type of product, which we are very keen to continue to drive higher. This is the other piece.
Other than the segment, this is the geographic piece of participation. It is a very interesting and important slide because it highlights the diversity, the opportunity, and the quality of our franchise. My first comment on this slide, look at this slide. The first thing to take away is about two-thirds of the income is already generating returns in excess of 15% ROE, and these are in the kind of blue boxes here. The first two blue boxes. The first box relate to our two core financial hubs of Hong Kong and Singapore, where we have very strong market position. The wallet is good. We have scale. We have ability to drive relevance. Here, we are very keen to continue to invest, to continue to gain market share in these two financial hubs. Okay. You have a second group.
The second group are markets where we have very good relevance, very good scale, and very good local market share. In many of the markets, we easily have around eight to 10%. Kenya, Bahrain would be a good example. In some of the other African markets, including Botswana, Uganda, Zambia, we actually have market share ranging from 15%-20%. We're not just even an international bank, we are actually seem to be a very strong local bank. Here, we have a very good proposition. The ROE of these markets are very good, are very high. Granted though, that there are one or two markets which are going through some headwind, be it through regulatory changes or be it through some of the more macro political and currency factors. We are very keen to make sure that we adapt our business model.
We change our business model to make sure we protect the profitability we make from this group of markets. These are markets that are very exciting. I would go to a bucket where I term them as turnaround markets. These are six very important markets to us, China, Korea, India, Indonesia, Malaysia, U.A.E. They are very relevant to our footprint. They are markets of strategic importance. However, today, they are simply not generating the level of return that we would like to see. From our standpoint, we are very keen to make sure that we accelerate that very focus and pivot towards priority and wealth, and to deploy digital to make sure that our cost to serve our clients there are strong. I'll just use the example of Korea. We talked a little bit earlier in terms of the progress they have made are very significant.
We bought KFB, Korea First Bank, back in year 2005/2006. Fundamentally, this bank used to be, and has always been, quite a strong lending-oriented bank, a very strong mortgage bank. As a matter of fact, we've done year in, year out, very strong selling loans. Unfortunately, that's where we stop. We have a very good client base, we have well over 2 million active clients, but we failed to penetrate these clients. This is where we have been shifting resources, from what is a pure loan sales to also involved in the kind of product, advisory, relationship management. We've been doing this over the course of last few years, and we're seeing very strong momentum around their wealth management penetration, around our priority client growth. We're still not there yet, believe me. It's nice to see them making the kind of progress.
They used to make as big of a loss, over $300 million. Now they're on a small profit. That trajectory is very positive. I would say equally, we have many markets where Malaysia, I just had dinner with a very reputed Malaysian businessman. "You, I've always grown up knowing you as a big, strong, and friendly bank. You are the bank. There's every room you should rebuild that very fast." The client affection is very strong. Digital India, where we have that very rightful share. Given the kind of brand, given our kind of market position, how we implement, how we focus, how we have discipline around where we choose to invest and then serve is very critical in turning around these markets. We have a last bucket, which I coin them as network . These are relatively, in totality, not very significant.
They only account for around 3% of our income. These provide very, very good network value to our footprint. They provide good source of liquidity. Equally, they provide very, very interesting optionality for us when it comes to deploying digital. The use of Côte d'Ivoire, for example, recently, where we launched a pure digital bank, is to really use these as test beds to experiment digital solutions, where if successful, whether we can then redeploy elsewhere. Equally, there are interesting markets like Vietnam, which is a nascent market, but provides very, very good opportunity. Sri Lanka is a very, very important Belt and Road country. These are markets that are very important network play, but also provide an interesting optionality in terms of usage of digital.
Now, I want to refer back to where Bill commented earlier about retail being part of the network and part of a broader client franchise in the corporate space is providing a very, very important ecosystem for us to leverage on. I did talk about the network around digital, which is around testing around one market and redeploying that in other markets. The alliances and partnerships, these are all key corporate clients, which either provides very, very strong product proposition in the case of a Pru or Allianz. Equally, they also provide very strong segment proposition, including an Asia Miles, an Emirates in Pakistan, Shinsegae in Korea. These are very, very important clients we partner with. These very corporates also provide a very, very large pool of their employees for us to bank with.
Last year, more than 50% of our new to bank clients came from either employee banking relationship or alliance partner, which is very, very substantial. We're keen to continue to leverage hard on that very, very value of that franchise. On the flip side, we contribute last year around $27 billion of surplus liquidity for the group. These are high quality, 73% of them being in CASA. It's very, very important for us to continue to drive that very, very liquidity support to the rest of the franchise. Right-hand side, I just highlighted two of the main, I would describe them as wealth corridors. Mainland wealth is a very, very significant, I would say, pool of wealth, which over time, our markets in Hong Kong and Singapore would be very, very good platform by which some of these mainland wealth can be supported.
Ditto around NRI, Indian wealth, the usage of U.A.E., Singapore, our core centers via which we can tap that NRI corridor. Early days, these are all within our footprint. Our brand plays well to the likes of mainland wealth and NRI corridors, and we're very keen to drive harder in terms of tapping these opportunities. Page 16. We have, over the last few years, invested and rolled out a lot of product initiatives, propositions, which I don't really intend to go through on a segment by segment basis. I'll just highlight a few that are very, very exciting. Singapore last year rolled out a silver proposition under Step, covering the age 55 and above. That has been a very, very strong proposition because that is one space that the market has not been as well addressed in terms of the needs.
We have focused around the expat segment in China, rolling out online mutual fund, and we're seeing dramatic growth in terms of our volume. Rolled out Personalized Investment Ideas, which is kind of robo-advisory. In Singapore, we intend to roll out more. Didier will cover a bit more. We also last month rolled out real-time onboarding in India. Again, early days, but so far the results are very, very encouraging. These are some of the areas that we believe will continue to drive positive growth in the segments we wish to pursue. Equally, on the right-hand side, we have been focused, investing very, very hard around improving the bank's risk conduct and controls. These involve embedding a stronger risk appetite framework, and also, very importantly, enhancing our client due diligence capabilities, increasing governance, increasing control.
As the bank strives to be the trusted advisor of our clients, we will not compromise controls for growth. That is a very, very important message we set for our teams. Finally, around the sixth component, sixth factor, which is on page 18, is how we're investing. We have, over the last few years, driven quite a substantial level of efficiency gains. These savings are being used to redeploy, and we have, as you can see, the cash investments between 2015 and 2018 total approximately $1 billion in cash. The way we invest has to be underpinned by the three principles. They have to either drive a seamless omnichannel experience for our clients. It has to make banking easier, again, for our clients, and also to invest to make us that very well trusted advisor from a wealth standpoint. These are the underpinning principles.
If you look at the split by which we have invested in our capabilities, obviously we have a very, very core basics of improving the risk analytics infrastructure. Over above, it's very targeted towards making sure that we invest hard in digital and invest hard in wealth platform, because we believe these are the very ingredients that are important to be a source of differentiation for the segments we wish to target. Okay. I want you to be reassured that every dollar we invest are targeted, really targeted, with discipline, focusing based on these three principles and augmenting really the digital and wealth sharply where we believe we can derive superior return on investment and return on equity. Okay.
Since these are two areas that we are investing hard, I want to invite Aalishaan Zaidi, is our head of digital, and then followed by Didier, who's our wealth management head. They can give you some color in terms of what we have been building over the past couple years, and just to showcase how these things are being invested and landing in the various markets. I'll start with Aalishaan.
Thanks. Good afternoon. I'm Aalishaan Zaidi, Global Head for digital banking. I've been with the bank for 23 years in various roles. Just building on what Ben has shared, I would like to give you some color on digital and leave you with three things. One, we are focused on making banking easier for our clients, as Ben has mentioned, and digital transformation is having impact, and I'll talk about that. Two, digital is enabling us to grow, to improve efficiency, and to disrupt in our markets. Three, we are partnering with fintech and big tech players to improve client experience. If I turn to the next page, which is page 20. Digital for us is a key enabler of our retail strategy.
To deliver value for clients through superior client experience, it's really a major shift from moving from thinking products to thinking client journeys end to end. It is really helping us reshape our business across our markets through differentiation, improving productivity and efficiency. We have been investing to pivot. If you see, we were largely paper-based. We are increasingly moving to real-time and automated. We were really branch led. We are moving to more digitally led. We were very manual on credit decisioning. We're really moving to more straight-through. We have been developing centrally, testing locally and rolling out globally, and we have made steady progress. If you look at our global digital Net Promoter Score, it has really improved to about 53 today, and it is now quite competitive.
We are not best in class as yet, which is around 60-70, and that is what we are working towards. Also, our digital adoption has also improved from 33%-45% globally. Again, in a few markets like India and U.A.E., we are 60 plus, which is encouraging, but really, we want to be 60 plus across all our markets, and that is really what we are pushing for. Then if you look at our total service requests, they have moved to 50% straight through digital end to end, and we were 1% when we started this journey. This is really driving a material shift in both productivity and efficiency. Let me now give you some color on some of the stories we are seeing across our markets, where we're using digital to make it easier for our clients.
I move to page 21. I'll start with India, where we're working towards turning around our business. Clients can open an account in India using their national ID, real-time, anywhere, anytime. Why is this important to us? India is a key market, and our branch presence is limited by regulation. That is really the case for many other international banks as well. With real-time onboarding, customer due diligence is being processed entirely in an automated manner. Our cost per acquisition, as a result, has fallen by 90%, and this dramatically has increased our potential reach broadly on the same cost base. Finally, on the right-hand side is our digital-only bank in Côte d'Ivoire. As Ben mentioned, this is a network market where we ran a test. Côte d'Ivoire has a population of 26 million and a mobile penetration of 65%.
Previously, we didn't have any real retail business in Côte d'Ivoire. Similar to India, you can open an account in 15 minutes. Clients have access to 70 of the most popular banking services. We have developed and deployed this in less than a year. Really once we've learned from all our valuable lessons in Côte d'Ivoire, we plan to leverage this across our markets, starting with Africa first, followed by the Middle East and Asia. If I turn to some of our big markets and some of the initiatives happening there, Hong Kong and Singapore. In Hong Kong, we launched a very successful co-brand credit card alliance with Asia Miles. I'm on slide 22. We simplified online acquisition process, and this has really resulted in a 50% increase in online acquisition rates.
In Singapore, we launched a best-in-class online equity trading solution. Didier is going to talk more about some of the other things we are doing in digital and wealth. This has resulted in a 2 times increase in income and a 23% increase in monthly new accounts. This is really interesting because clients are finding it easy and convenient, and that is what is driving these numbers. I would now like to just move to page 23. We are regularly asking ourselves about the role of fintech and big tech companies, and how we participate with them. With fintechs, we are selectively partnering. Here is really an example in Korea where we worked with PayKey. It's a fintech that provides keyboard banking solutions and enables financial services. Our clients can transfer money instantly using popular messaging apps. This capability is being rolled out into other markets.
In Singapore, we had a real issue of not having enough ATMs. It was a real pain point for our clients. We partnered with a local startup called soCash. We provided 400 additional locations to clients across the island, significantly increasing the network available in addition to branches and ATMs. With big tech players, we are connecting to participate in the large ecosystems. For mobile wallets with Apple Pay, Samsung Pay, Android Pay, we are live in about seven markets. On social channels, our clients can connect with WeChat Pay in China, WhatsApp Pay in India. Really in summary, I leave you with three things. One, we are focused on making banking easier for our clients. Digital transformation is having an impact. Two, digital is enabling us to grow, to improve efficiency to disrupt our markets.
Three, we are partnering with fintech and big tech players to improve the client experience. Let me now hand over to Didier and he will talk a bit about wealth management.
Thank you very much. Good afternoon, everyone. My name is Didier von Daeniken, Global Head, Private Banking under Wealth Management. I joined the bank in 2016, and I am really excited to be part of the growth opportunities in some of the most exciting as well emerging markets for wealth globally. Wealth Management, as you heard from Bill and from Ben, is a key growth and return on equity driver for the retail bank. Today, I will present you four key messages about our business. The first one is that we have a differentiated proposition that we are continuing to enhance to capture high-quality growth opportunities. The second message is we have achieved good income momentum over the last decade with an increasingly resilient and diversified mix. Thirdly, we have very clear strategic priorities with execution well underway.
Finally, we made good progress against our multi-year front to back digital wealth program. I am turning now to slide 25. Let me talk about how our proposition is different. First, we have differentiated capabilities in advice. The second one, as Bill mentioned, we are open architecture. We are open architecture right from the investment strategy through product selection. We have very strong strategic partnerships with both insurers and asset managers. These capabilities taken together are unique to our business. Our clients rely on us for an objective set of processes and services to provide unbiased advice with a trusted brand that has been local for a very long time. As Ben said earlier, we have a truly unique emerging market franchise targeting the affluent urban clients for whom our international bank and wealth management capabilities resonate.
With these capabilities, we have achieved good income momentum over the last decade with a resilient and diversified income mix across bancassurance, funds, FX, capital markets. We have delivered 10% CAGR on income and 11% CAGR on AUM since 2009. Since 2014, with the retail bank sharper focus on affluent clients, wealth management has grown its share of retail income from 20% to 30%. Moving to slide 26. We have a very clear set of strategic priorities, and the execution is well underway. Our priorities are to further enhance our differentiation in advice, to digitize across all asset classes, to continue delivering client-centric solutions, leveraging on our open architecture, and importantly, to increase consumer awareness for the bank's wealth management capabilities. Finally, maintaining a strong compliance foundation, which ensures we can scale sustainably. Let me now elaborate on our digital program.
What we are building is differentiated in two ways. First, we are building a holistic end-to-end digital investing experience for our clients, this across all asset classes. As well as the mobile and the advisor channel. This will provide our clients a great investing experience, and this will help us to further scale up the business. Now, within this program, we are building several leading capabilities, be it Personalized Investment Ideas, China mobile phones, mobile FX, or structured product pricing. I will speak further about a couple of these examples shortly. Over the last 18 months, we have already digitized a significant portion of what is a typical investing process, which is from risk profiling to accessing our market views, through placing orders for mutual funds and/or equities.
We are focused on giving our clients this integrated set of capabilities in all our key markets so they get a best-in-class investing experience on any channel of their choice. I turn now to the final slide 27. You have here two examples of demonstrated early success with the capabilities we have launched. The first one is our mobile phone offering in China, which is allowing us to increase our share of the massive online wealth opportunity in the country. Since launch of the capabilities, we have seen double-digit increase in fund sales. On ask, or if not more importantly, we have seen a substantial migration of our business to the mobile channel, today at some 75%. This significantly enhances our advisors' productivity, allowing them to focus on advice on sales and not on transactional paperwork. This also leverages our competitive advantage with our offshore offerings in the country.
Our second capability, which we launched at the end of last year, is a first in Asia in the advisory space called Personalized Investment Ideas. We are now extending this capability to multiple markets. What would take a relationship manager hours to prepare a year ago is now delivered in minutes on an iPad. This allows our advisors to create unbiased, tailored, and consistent advice for clients. Since its launch in Singapore, we have driven 44% of our fund transactions via this platform, and we have covered more than 8,000 clients in a couple of months. These are just two of the several capabilities we have launched for clients in the last 18 months, and the results so far are very promising. We are focused on client adoption, continuous improvement based on client feedback, as well as the frontline feedback.
We also believe that given the consumer behavior in our markets, it is the right set of capabilities to strengthen our differentiation and improve client experience going forward. Let me recap our priorities and our competitive advantage. First, we have a differentiated proposition, and we continue to enhance it to capture growth opportunities. Second, we have a good track record achieving income momentum over the last decade with an increasingly resilient and diversified revenue mix. Third, we have clear strategic priorities, and the execution is well underway. Finally, we made good progress against our multi-year, front-to-back digital wealth program. With that, I would like to thank you, and I will hand back to Ben.
Okay. All right. Thanks very much, Didier. How does it all hang together? What can you expect from us going forward? I think very clearly, number one, you should expect us to continue to focus on areas where we are competitively advantaged, areas where we have the strongest point of differentiation, which is in the emerging affluent segment. That pivot will continue. Secondly, you should expect us to invest in digital capabilities, where we want to improve the way clients transact with the bank, which is banking should need to be made easier for our clients. Thirdly, you should expect us to drive hard around improving that liquidity surplus generation, to help support the bank's overall funding. From a financial standpoint, you should expect us to deliver a mid-to-high single-digit income growth over the medium term on a CAGR basis.
You should also expect us to continue to drive very tight cost control to support the group's overall cost target whilst be very disciplined around how we invest. That investment has got to continue to improve upon the way a client has externally experienced with the bank. Okay. In totality, the team and myself are confident that this business is capable of delivering a sustainable mid-teens ROE over the medium term. Okay. Thank you again for coming. That wraps this plenary session. I'd like to hand over back to-
Yeah. Great. Thank you. It's Ronit from Citi. Ben, we've heard a lot today about things that could go right in terms of upside and maybe Korea could make more money or India could make more money, and Malaysia. Could you talk about some of the challenges or risks in the franchise you're sitting in? You sat in Hong Kong for a long time, and if you have to think about the two or three main big challenges to protect that wonderful profitability you and HSBC, what are the sort of big things that keep you awake at night?
You mean in Hong Kong?
Hong Kong ROE and Hong Kong [profit pool], Hong Kong revenue per employee. Fantastic for you and HSBC.
Yeah.
What could go wrong?
We are very well aware of Hong Kong. Everybody sees Hong Kong as that prized city or market that everyone wanted to come in. In particular, we're watching very closely in terms of what the north of the border players would be eyeing to come to Hong Kong. You may have already heard and read about HKMA's looking into establishing virtual bank licenses, and I'm sure there'll be a lot of interest from north of the border. Obviously, we're watching that space very closely. That said, I do think that very brand of ours, that very note-issuing status and that very relevance, we have to continue to drive very hard in leveraging that very brand, making sure that we continue to have the kind of product and proposition relevance to the customer segment that we are operating in.
We are, as you would expect, investing quite hard behind the scenes, through digital, through product, through proposition. We have been rolling out a number of them. You could easily have looked at, for example, that the way we launch Asia Miles is really focusing on using more than just our own capability, but leveraging on others to also augment the proposition that we have. The future of Hong Kong, actually, I think it's still a positive one. Really, from a standpoint of if you look north of the border in China, you do have a huge amount of trapped wealth that currently is really desperate to find avenues to diversify. Right? That very affluent in China. If China doesn't allow an element of outflow, it's going to cause all sorts of domestic asset bubbles because this has no channels to go.
You either go in property or you go to A-shares, and that's about it. China is well aware of that, and they also see Hong Kong as that very component of asset diversification to allow some of those steam to let some steam out. That's why, from our standpoint, we have to be investing very hard also in thinking about the future next 10 years wallet. How would that evolve? How do you make sure that your, or our presence in China, our brand becomes also an association? If I diversify out of China, Standard Chartered is the place I want to go. Right?
That's some of the things and therefore how we distribute our footprint, how we look at digital, not just in Hong Kong, but also vis-a-vis both sides of the border, Greater Bay Area, how we position for that, how we are making sure that we are man-marking the key sites, key locations. These are all areas we're both very worried, but we also know that the future can be quite exciting as well.
I guess you have an interplay of two dynamics. One is the fact that the return on Risk-Weighted Assets in your business is going up as you focus on priority and wealth. At the same time, there is a very clear message that you need to invest into the franchise. If I look at your cost-income ratio, for a retail bank, you're operating within 70% and 75%, which seems to me like in the long run, or let's say the medium term, you want to be more like a private bank with a very highly efficient balance sheet and a high ROA, ROE, but potentially also a high cost-income ratio.
Is that the way we should think about your retail bank going forward? Do you think that actually once we are past this initial digitalization investment, that you can actually give us some cost efficiencies as well?
The current cost-income ratio from my standpoint and for our standpoint within the management team is too high. We have to drive that down. We have to drive it down. Equally, we do not believe that there is a target number or ratio via which we get that number to, because it also has to depend on the mix of that business. I do have a lot of markets where operating at, let's say mid to high 60s cost-income ratio, but delivering us north of 20% ROE because the mix of income is one where you're using less capital. Right? There are markets at which you can deliver that. There are equally markets which has lower cost-income ratio, but the loss rate, because you're focusing on quite heavy unsecured, doesn't make the ROE equation.
From my standpoint, the first order of, I would say, driver has got to be bottom-line ROE every time. You have to get two components right. One is the mix of your business, and the other one is your cost to serve that segment. Okay? As I explained in the various buckets or markets, some are more affluent, but some are, let's say Africa, they're more on the personal side because of the market share, et cetera, which I actually don't mind to the extent that they can drive bottom-line ROE. Okay? There is a case for if we can be skewed towards affluent, it can be more like a private bank. You don't use capital. The cost-income ratio is less of that impediment. Cost-income ratio, right?
Overall, the first target is to get our current ROE. We want to move back towards the kind of mid-teens range. You use the two levers of mix of business and cost-income ratio, which currently today, as I say, it's too high. Yeah.
We'll start here and switch again.
Sorry. It is Robert Sage from Macquarie. It is another cost-related question, which is that sort of looking at your medium term revenue CAGR, I think it is a little bit above the group. I think the group is 5%-7%, and you are saying mid-single digit to high single digit. Does that mean you will cut a little bit of slack in terms of cost growth, or would retail banking cost inflation going forwards be below 3%? That would imply, A, that you are sort of running with sort of wider jaws than the rest of the group.
It is a dynamic question. Retail is less of a constraint around capital per se, but more around that operating leverage of jaws, cost and income dynamic. Okay. It is hard to provide the very simplistic answer. It really is a function of our ability to drive the right level of revenue, quality revenue. If that becomes of a higher degree of growth, that is a high-class problem that I have to deal with, alongside what Bill and Andy have to look into, the entire construct of trying to keep costs within inflation. If we can collectively drive the right type of revenue and that revenue is on the upper end, it is a good problem to have. We will then have to figure out how do we optimize that very investment.
The starting point from my standpoint is, we have to have that level of discipline to drive efficiency to fund. That discipline is something that I think each market and each region will have to apply quite strongly as well.
Chris?
Thanks. Hi there, it is Chris Manners from Barclays. I just have a couple of questions on cost of risk. It is something we have not really explored too much in the sessions. It looks like cost of risk could cut 2015 was about 70 basis points for your business. It is running below 40 basis points at the moment. Q1 might even be lower than that. To hit your targets, what sort of cost of risk numbers do you think you are going to need to do in terms of basis points? Also, maybe you could just talk a little bit about the risk environment and anything you are concerned about, or is it sort of plain sailing from here? Thanks.
I might draw my Chief Risk Officer who didn't get to present. He can also comment on the risk environment. You should expect that the current level of cost of risk is we've brought that down from what we thought has been too high and perhaps too concentrated in some of the areas of unsecured. We've cleaned that up. We de-risked. We're now in a position where we are more comfortable to start to grow. Right? We got to the right level now. That growth also needs to be targeted towards a type of segment that we believe it is a life stage where they will, early stage, but they will eventually have the potential to become emerging affluent and affluent type of segment. I don't want to whether you comment on environment.
Sure. Thanks, Ben. My name is Vishu Ramachandran. To your answer on cost of risk, if you look back in 2014, on a basis points basis, cost of risk was 91 basis points. We ended 2017 at 38 basis points. It's going to be driven by two things. It's going to be driven, one, by the mix of assets, the share of secured versus unsecured assets, and the second is how much appetite we have based on how much what we can price on the unsecured side. Over the last 10 years, we've made no losses on mortgages, and we believe that if we take the share of unsecured assets up from the current 15%-16% to close to 20%, you should see a steady state cost of risk between 45 and 55 basis points. In all these circumstances, we ensure the risk return characteristics are attractive for growth.
To your second question, what do you worry about? We worry about two things. The first thing we worry about is what lending happens outside the banking system, which the bureaus don't capture. That typically happens at the lower end. And the second is, of course, any kind of market-related, economy-related event which could hit employment. That would be the two risks. Or property price depreciation. Our average LTVs are less than 40%, so it has to fall a long way before we get affected. Yeah, Ben.
Thank you.
Hi, it's Claire Kane from Credit Suisse. I guess what we've seen as you've been pivoting towards the emerging affluent segments is obviously there's been some runoff of the customers that you don't want to serve or are not under your risk appetite anymore. I guess we've also heard that some of this, the top segment of customers you're targeting maybe are around 15% of the market in many countries, and clearly you have competitors that also find that segment very attractive as well. I guess my question is there inevitably a cap to the size that you can be under this new Affluent bank or private bank that you want to be, and how much of the revenue attrition should we expect going forward? Is revenue growth not really the trajectory? Is it more about the leverage that you'll get from a lower Risk-Weighted Assets density?
Thank you.
I don't think we should completely describe this as an entirely an affluent and private and that's it. I don't think that's what I'm trying to deliver here. Conversely, what I'm trying to say is that space, granted, a lot of people are interested in, but it's an area that we believe by Standard Chartered, by our brand, by our capability, by our wealth, by our platform, is one where we believe clients will choose us for. Okay? There's a higher chance of us being able to compete well and win. It's not to say that we will not focus at all on the personal and premium, because they are all operating at a different life stage in terms of product needs. The emerging affluent will have lending needs, and we're quite happy to support that lending need.
What we are trying to avoid is to be the mass where some of these will never work the way into becoming mass affluent. It's in that space that we don't think we have a true distinct advantage to compete with local banks. Right? Where we do think we can compete and win is where they're capturing that whole curve of emerging affluent and affluent. That will entail lending. As I showed you, the premium segment, the single biggest product is mortgages. I'm very happy to continue to drive that space. I think if you can get the right segment, you anchor the mortgage, you anchor the payroll, which we are focusing very hard on EB, or employee banking, you get everything in between. Right? Because mortgages is the biggest output. Also outward payment. Salary is the biggest incoming payment.
If you can both anchor it with the bank, the rest becomes yours. Right? I'm very keen to capture that space. Following that life cycle is critical from my standpoint.
Okay, maybe just one follow-up. Should we interpret it then that you expect all segments to grow from here, it's just the rate of growth would be higher amongst the emerging affluent?
My basic assumption in terms of our thinking would be the priority should grow faster than personal, but not to say personal will not grow.
Okay. Thank you.
Right.
Yes. Martin Leitgeb here from Goldman Sachs. Two questions, please. The first one is, just to come back to the growth opportunities within the retail franchise. We discussed a lot the growth opportunities within the different products, wealth management, deposits and the various countries. I wanted to ask you, if you look at the different countries, which countries are you most excited about in terms of growth opportunities going forward? Which countries do you think can make the biggest revenue contribution in terms of your growth ambition for income going forward? The second question is about scope for M&A, probably in a more smaller sense, portfolios, maybe some smaller wealth management product portfolios and so forth. Just looking at Standard Chartered, an abundance of capital and funding at this stage, do you see scope for very selective M&A within certain product areas and regions?
Is your focus on products affluent such that that would in principle exclude realistically any form of M&A?
First of all, on markets which are interesting, I would start with following where is the wallet heading in the next decade? Try to fast-forward what the future state will be and back to where we need to do now today to capture that affluent segment space. I would say there are a lot of countries in our market who are all participating in the whole emergence of that middle class affluent, the need for diversification. We highlighted a couple corridors, which I personally think it's actually very exciting, but currently, I don't think we capture a lot of them. The mainland wealth, the NRI, these are all very exciting. From a return standpoint, I just don't think it's about the future growth.
It's about addressing some of our current less-performing markets because a delta of $100 in my turnaround market is exactly worth the same as from the highest growth market. Right? To you and to us, it's that delta focus that drives the best return improvement. We're quite happy to go every single bucket to work very hard on improving that very change in return dynamics and portfolio in the picture. M&A, there are two types. One is around buying, let's say, whatever bank who wants to exit. The other type will be augmenting either a product or even through like a fintech proposition, et cetera. If you were to ask me, I would say the latter is perhaps a little bit more interesting. In most cases, acquiring another bank's portfolio and try to synthesize it and whatever, the chances of value creation sometimes is 50/50, right?
Unless it's really a portfolio, it's so strategically I would say marrying to what we're trying to do, then it makes sense. Otherwise, just buying somebody's clients, I think we have to think quite sharply in terms of the ability to drive value. To have interesting proposition, it could be technology, could be whatever, that can augment what we currently don't have. I wouldn't rule that out. Again, anything can happen.
Okay. I think there's one other? Ken, and Chris, if you got one more.
I have a more general question. You've been in the bank for a long time. How has the bank changed in terms of process, in terms of how you make decisions now than what happened three, four years ago?
It's very different.
Can you explain a little bit what you mean it's different?
Okay
The way you make investment decisions and way that you allocate capital, et cetera. What has really changed today relative to.
Three, four years ago, if you look at the top team, it was represented by, I'm talking about at the CEO and one down level, management team level. It was one business, two geographies. Three, four years ago. Before Bill came. Underneath that, it was three segment, five products, eight regions. If you multiply that, it's 120 combo. Represented by one to two. Under Bill, it's now. It's fundamentally four segments and four regions. That combo, four by four, it's at the top table. The kind of discussion, debate, dynamics, is a lot faster today than it was three, four years ago. Hopefully, decision-making are more in a collective whole under Bill and other top team discussion. We do debate hugely around investments, about strategy, about control, about risk, everything. We do business reviews together.
From that standpoint, I think it feels sharper compared to three, four years ago. That'll be my sense. I don't know whether, Bill, you want to add anything.
I wasn't here three or four years ago.
Secondly, just can you talk about morale in the Retail bank? Clearly you've gone under material, you mentioned some of the numbers in terms of restructuring, et cetera. Clearly, it's difficult for us to judge, but are we still in the phase where it's difficult to retain people or people want to move on morale, and I'm sure you do some internal measurements as well. Has that totally changed?
Internally, interestingly, when we do our own internal, what we call My Voice, which is a kind of staff survey, okay, you compare Retail, Commercial, CIB functions, et cetera. Retail's engagement score is always up there. Whenever I go to visit a branch, a call center, whatever, I get energized, and I'm serious. Vice versa, whenever I'm down, I go to a branch, I come out happy. Seriously. It's like magic. It is seriously like magic. This is not to say we don't have attrition, because certain types of job class are in absolute high demand, particularly around those affluent segment relationship managers. Everybody's after that. It's very important for us to start very early, homegrown them, and then start from an early stage so that they stick. The average tenure's longer.
One of the biggest deciding factor amongst product brand, et cetera, is also the relationship manager, the ability to drive down turnover, et cetera. We're spending a lot of time, and different markets have different turnover, et cetera. I would say in general, Retail is always a higher engaging. People are engaged. If you go to different layers, the spirit is good. If you can get the direction right, you're talking about 30,000 people rowing the boat at the same pace, same direction. That will be very powerful. It's like a tanker. If you can get it in right shape, moving it along, the people are fantastic, really, genuinely. It's been very good.
Anyone online?
Just one more maybe top-down question, maybe it's one for Bill. It was just that if you're going to deliver a mid-teens ROE here in retail, why would the group target only be just above 8% ROE? It sounds quite exciting what you're going to do here, so why would the rest of the group not be able to pick up and get the medium-term target a bit higher?
Let me take it first, Bill.
Okay. First of all, there is each segment also has one component which is not built into the 15 or whatever mid-teens ROE that is called central and other. That central and other entails levy, bank levy, entails associates, let's say upper management, you can't farm it to a segment. There's also a broad component around the kind of treasury markets, the kind of ALM equivalent that is not being farmed out. In totality, that central and other, each of the segment needs to be above the overall in order to compensate for the levy, et cetera. That's a starting point. The flip side is, look, not every single business are necessary. Some are naturally higher returns, some are slightly less. In aggregate, that 8% is only the first milestone.
We need to drive harder. All I'm trying to say is this business of retail has the capacity to sustainably deliver that. It's not to say the others shouldn't also move up. I don't know, if Bill or Andy, you can
Our target is not 8%. That's a staging post on the way to a cost of capital of 10%.
Any more questions?
Well, one more. We have minutes to go. I just want to cut you off there, Ronald. Okay, one more.
I was just looking at the shape of the retail bank, it seems to me as if there's a lot of quite good positive stories in terms of improving delta from currently underperforming territories. I was just thinking, does, from your position, having reasonably recently taken over the retail bank, do you sense that all of the geographies in which you're currently present will remain part of the group going forwards? Or are there some where you just see that actually there's going to be no hope of actually getting them to reasonable sort of levels? I know you shut down, was it Philippines and Thailand or something? Are there anything else that you see? Without necessarily even being specific about the country name.
I'll never say never. However, I think what has changed from my standpoint is the speed of technology innovation in digital. You can have a view around how regulation will change, or not change on a market by market basis. I take the view that in the foreseeable near term, licenses remain a scarce resource. That being the case, these licenses, maybe there's a small market, digital can be an interesting optionality for us in terms of using it as a test bed, using it for experiment, to test and learn. Cote d'Ivoire is a good example of doing that. Therefore, we do think that this very network, which a lot of banks are trying to come in, are trying to replicate, but it's actually very difficult to replicate.
From my standpoint, this is a very interesting, I would say, collection of markets which from my standpoint, digital adds optionality. I will never say never in terms of are there certain markets that really has no network play, no hope, whatever, or cost to turn around is so high. We may have a Philippines coming forth. I would say, the main focus is for the key markets that I've highlighted. We do believe there is a chance to turn around if we focus hard enough and be disciplined about it.