Monday, September 10, 2012 Business

City Bank aims for greater heights

Managing Director K Mahmood Sattar shares his future plan for the bank
The local banking industry is gradually turning into a role model for the bankers of the emerging countries thanks to offering innovative products and services through adopting global best practices. The banking sector no starts getting international recognition and eyeing more accolades from global arena. !"e are in the limelight in the international arena due to our adoption of global best practices for satisfying customers# financial needs,$ said % Mahmood Sattar, managing director and &'( of The &ity Bank. The bank as recently conferred the prestigious #Best Bank in Bangladesh for 2012# a ard by )inance*sia, a leading financial publication in the *sia +acific region. !"e are e,tremely delighted ith the a ard,$ said Sattar at an e,clusive intervie The -aily Star at the bank#s head office in -haka recently. The a ard came thanks to &ity#s successful adoption of global best practices of the banking sector. !This is the first year e are a arding in this category and have selected &ity Bank for its leadership in risk management and its plan for steady and sustainable gro th,$ said the )inance*sia a ard citation. !.t might not be the best bank in the country in terms of net ork and balance sheet si/e or even profitability, as there are some bigger and more profitable banks operating in Bangladesh.$ But it is the best bank in terms of adopting global best practices, hich in an emerging market is e,traordinarily important, as the commercial banking system is the backbone of the economy, according to the citation. The transformation began hen senior banker Sattar stepped up to the helm of the bank in mid02001 as the managing director and &'(. 2e spearheaded several innovative steps to turn the bank into a modern financial supermarket using the latest technologies. ith

!Since its establishment in 1345, &ity Bank#s main endeavor has been to increase its shareholders# value and be respected as a compliant organisation,$ Sattar says, hile e,plaining the main philosophy of this first generation bank. But under Sattar#s leadership the bank has gone beyond those targets. Sattar 6oined the local banking industry after 20 years of senior management e,perience across the globe ith banks such as S&B and *78. 2is core management team also came ith e,tensive foreign banking backgrounds 00 and they brought international standards to the table. They focused on remodelling the business along a customer value segmented line and created separate tailor0made services for each segment such as corporate, retail, SM', cards and treasury. The decentralised branch0based banking system, steeped in irrational cost and non0 transparency, as shunned for a centralised business plan overseen by top industry professionals. But &ity did not 6ust streamline operations9 they improved the overall :uality of assets, re0launched the brand, leveraged the potential of technology potential, improved the :uality of product offerings and put in place much higher benchmarks for service e,cellence. !"e have brought an international standard in risk management and improved service standards,$ said Sattar. !So no e are getting international recognition.$ 'arlier in 2010, *sian Banker, another esteemed international financial publication, honoured &ity ith #The Strongest Bank in Bangladesh# a ard in recognition of successful #change management processes#. The bank also collected other a ards such as the *merican ',press Marketing * ard for #(utstanding 7e &ard launch# in 2010, Money;ram .nternational#s #Best &orridor &ollaboration in South *sia for 2011# for its in ard remittance business gro th. !"e actually got the international attention in 2003, hen *merican ',press nominated &ity Bank as its sole franchisee in Bangladesh,$ said Sattar, a former chairman of the *ssociation of Bankers Bangladesh, a professional body for senior bankers. 2e said *merican ',press, after a si,0year long search, finally selected &ity as its sole franchisee in Bangladesh, thanks to the bank#s strong corporate governance, transference and sound credit risk management.

&onsidering the overall negative outlook for the global economy and the many challenges Bangladesh that faced in meeting its macroeconomic goals for fiscal 2011012, &ity Bank#s solid performance during the year becomes all the more impressive. -espite li:uidity pressures, the bank as able to maintain its credit deposit ratio at a satisfactory level. &ity#s statutory li:uidity ratio, by the end of -ecember 2011, according to the annual report, stood at 20.30 percent against the 13 percent demanded by the central bank. 'arnings per shares of the bank rose to Tk 5.33 in 2011, from Tk 5.<< of the previous year, despite the share market crash. .n 2011, capital ade:uacy of the bank stood at 12.13 percent against the Basel .. and regulatory re:uirement of 10 percent, hile profit before ta, rose to Tk 5,=<4 million from the previous year#s Tk 2,333 million. 7on0performing loans dropped from =.=2 percent to 5.== percent in 2011, indicating further improvement in asset :uality. &ity has been a arded an **5 for long0term rating in 2011, one notch higher than that of the previous year, by the credit rating agency of Bangladesh. *s part of the restructuring plan, the bank introduced various innovative services and products9 brokerage business, merchant banking arm, SM' centres and numerous SM' and *gro0products and a full0fledged .slamic banking business under the brand name of &ity Manarah. &urrently &ity has 10= online branches and 152 *TM booths> it has around 1 lakh *me, cardholders, ith plans to launch t o ne *me, cards this year. The bank also plans to launch mobile banking both for rural and urban people. .t also aims to open at least 10 financial kiosks this year. !(nce the kiosks go in full operation a customer need not go to the bank branches. )rom the kiosks, customers can satisfy all their banking needs, such as applications for loan and credit card, deposit and cash ithdra al,$ said Sattar. !The accolade is not only for &ity Bank but for the hole country,$ said Sattar, adding that the a ard ill encourage other banks in the country to adopt global best practices. Sattar feels the a ard had notified the international community of Bangladesh#s strong banking system 00 and ill no consider Bangladesh as an emerging market for investment.

!Banking is the backbone of an economy. .f a local bank gets international recognition, it portrays a positive image among the prospective investors. .t ill encourage them to invest more in that country.$ !So local industries ill get the opportunities to form more 6oint0venture companies ith foreign partners,$ Sattar said. 2e said the luring of foreign investment, ho ever, depends on opportunities and regulations, citing e,amples of *frican countries here there are plenty of opportunities but no regulations 00 and hence there have not been that many significant investments. !But e have both opportunities and regulations to attract foreign investments,$ he added. The &ity Bank ill continue to put emphasis on organisational e,cellence, the bank chief stressed.