(MENAFN- Gulf Times) Commercial Bank has 'sufficient potential to grow significantly in Qatar over the next few years, said Group CEO Joseph Abraham.
'Our primary focus will remain on Qatar. Qatar is an AA-rated economy; the country's macro fundamentals are robust and strong, Abraham said at a media roundtable on Doha yesterday.
Commercial Bank is a 'solid franchise built on more than 40 years of 'innovation and customer service, he said.
Incorporated in 1974 as Qatar's first private bank, Commercial bank was the first in the country to introduce ATMs, credit cards, POS machines, personal and vehicle loans, Internet banking and mall pavilions as well as mini branches, he pointed out.
Commercial Bank's countrywide network now includes 29 full service branches and 179 ATMs.
Abraham said Commercial Bank would 'continue to drive costs lower through reduced waste, while simultaneously investing in new technology and branches.
'There has been a significant decrease in our operating expenses of 19% year-on-year, in line with our strategy to drive efficiencies across the business, streamline processes and reduce costs. Consequently, we have reported a healthy consolidated cost of income ratio of 37.5% last year, down from 45.7% in 2016, Abraham noted.
Commercial Bank Group posted a net profit of QR604mn in 2017, up 20.4% on the year before.
This, Abraham said, was driven by the strong execution of its strategic plan to build a strong diversified business while provisioning legacy loans and improving cost efficiency.
As part of the bank's strategy, it has strengthened its balance sheet and made additional provisions on legacy assets, increasing provisioning by 33.8% year on year to QR1.7bn.
As part of Commercial Bank's five-year strategic plan, Abraham said, 'We have recognised five C's corporate earnings quality, client experience, creativity and innovation, culture and compliance to become the best bank in Qatar. When we achieve these, we can earn the confidence and trust of our clients and shareholders.
In relation to ABank, Commercial Bank's subsidiary in Turkey, Abraham said, 'We will also make sure (the subsidiary in) Turkey grows and delivers returns on the equity we have put in. ABank remains a strategic asset and an important opportunity for us to leverage outside the GCC market. We have also appointed a new well experienced CEO and two new Turkish board directors at ABank who will lead its strategic re-shape and growth.
On its associate, National Bank of Oman, he said, 'NBO maintains its strong position in the Omani market.
In the neighbouring UAE, Commercial Bank is looking at completing the sale process (of UAB).
'Until we do all these, I don't think we will be looking at other countries, Abraham said when asked whether Commercial Bank would expand into more countries.
Commercial Bank, he said, has embarked on a digital transformation journey in line with its passion to provide the 'best client experience, creativity and innovation.
Highlighting some of Commercial Bank's 'first-to-market digital innovations, Abraham said these include the 60-second online remittance service (to India, Sri Lanka and The Philippines); regional blockchain technology pilot; remote cheque deposit and contactless debit cards.
He said Commercial bank continues to grow its business with the right sector mix underpinned by a faster-than-market growth of 14.6% in loans and advances to customers and 9.5% in customer deposits.
Abraham said Commercial Bank expected loan growth of 7% to 9% in 2018, in line with the market.
He also said Commercial Bank was pushing to increase lending to state-run companies as the government presses ahead with infrastructure projects.
'We have historically been underweight in the public sector and this is something we are remedying very quickly, added Abraham, who took over as Commercial Bank Group CEO in July 2016.
‘Potential sale' plan of stake in UAB on track
Commercial Bank is looking at the 'potential sale of its stake in the UAE-listed United Arab Bank, said Group CEO Joseph Abraham.
'We have entered into an exclusivity agreement to negotiate terms of the potential sale of Commercial Bank's stake in UAB. An extension on this agreement has been given until February 28. If this happens capital will be re-deployed to support growth of our other businesses, particularly in Qatar and Turkey, Abraham said at a media round table in Doha yesterday. He said Commercial Bank has only 'limited exposure to the UAE and Saudi Arabia, which has imposed a blockade on Qatar. 'We have given them loans worth QR1.5bn while deposits from them were to the tune of QR3.5bn, Abraham said.
As part of its strategy, Commercial Bank has strengthened its balance sheet and made additional provisions on legacy assets, increasing provisioning by 33.8% year-on-year to QR1.7bn in 2017.
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