Interview: “We’re businessmen and entrepreneurs at heart”

By Farrah Brake

Mashreq Bank CEO Abdul Aziz Al Ghurair talks about his focus on innovation, support of SMEs, and customer centricity; and the bank’s emphasis on growth within the Gulf Cooperation Council.

Chief executive officer of Mashreq Bank, chairman of the UAE Banks Federation and business owner, His Excellency Abdul Aziz Al Ghurair views himself as an entrepreneur at heart. In his various roles he recognises the importance of an entrepreneurial spirit, “I come from a business family and we’re entrepreneurs, but the scale has changed. This bank was established in 1967 and will soon be 50. We’re the second oldest bank in the UAE. Every single business we have today started from scratch, so we’re really businessmen and entrepreneurs,” he said.

The rise of SMEs in UAE
The Al Ghurair Group was founded in 1960 by Ahmad Al Ghurair and for 55 years, the name has been at the centre of the UAE business community. Mashreq Bank began a few years later with $1.6 million worth of investment capital and was the first bank in the country to introduce ATM machines and credit cards. Although Mashreq is largely a corporate bank, it is one of the top five retail banks in the country and has taken strides to support local small and medium sized businesses under Al Ghurair’s leadership. This is because “we feel it is our duty to encourage small and medium businesses as they are quick to start up, can generate employment very quickly, and have an impact on the GDP of the nation. They can move faster so there is more focus on them from the banks and government. We play a role in funding their business.”

Mashreq Bank’s strategy for the SME segment is to be the preferred partner for the SME client from the time of incorporation. The bank’s emphasis on technology in serving the retail segment has transcended into the SME segment and it offers a full product suite designed for SMEs, including self-employed personal loans, merchant overdraft, foreign exchange solutions, trade services and insurance. Products like self-employed personal loans and business insurance provide flexibility and convenience for the customer.

In addition, the bank launched SMEXchange at the end of 2014, an online platform to support local SMEs and start-ups. The online portal creates a community for SMEs to encourage them to engage in enhancing development in the UAE marketplace. The portal allows customers to advertise their products and services to potential buyers. In addition, there are monthly workshops available for customers and an “Ask The Expert” section which provides an opportunity for local businesses to interact with experts who provide advice and assistance for SME owners on specific business issues.

Moving towards customer-centricity
Al Ghurair promotes family business outside of the bank through the Family Business Network. “The group promotes good governance for families and what they need to do to ensure good succession planning. This is actually a global issue; family businesses, no matter how large, can be destroyed if the founder does not put in place the right framework,” he explained.

Establishing the right framework for the industry’s risks needs to be addressed and managed, followed by looking after customers. “I think it is always good to be in the right industry. You need to select that first and understand it. Next you have to manage risk. That’s true no matter what industry you’re in. Then you have to look after the customer. I think there’s not enough attention being paid to customers in the region,” he elaborated.

In the past, banks in the Gulf have been primarily product-focused, emphasising product portfolios for each customer segment. Now banks are transitioning to becoming customer-centric and looking for ways to engage customers. This has required training for customer-facing staff and re-evaluating the standards and key performance indicators by which they are measured. Mashreq Bank has sought to engage its employees in order to move towards engaging the customer. “The difference is our employees; disengaged employees are a burden to the organisation. If you have anything lower than 8%–10% of disengaged employees, that’s already world-class,” Al Ghurair said. “Employee engagement has been the way forward to move the organisation to the next phase of evolution.”

Implementing regulations at the right time
The UAE Central Bank has been implementing new regulations on hitherto unregulated areas to standardise the banking sector and maintain the growth of the economy. Al Ghurair recognises the importance of the banking sector in the growth of the economy: “People should be aware that a country’s banking system is one of the pillars of a strong economy. Thankfully, the UAE has good policies and a good central bank, and the economy is able to flourish.” The UAE banking sector is the largest in the Arab world with a total asset value of $626 billion.

With the UAE being a leader in the region’s banking space there are concerns about regulations and when new regulations should be implemented so as not to put too much pressure on the banking system. For Al Ghurair, “the best time to establish regulations is when you’re in a good position. Liquidity is great here now so the timing is good. If liquidity is bad and you impose regulations, nobody can comply with them.” In order to become a world-class banking sector, the central bank needs to be proactive and understand the local market to move the banking sector into the next phase. Many banks are growing outside the region and are looking to meet international best practices.

For now, Mashreq Bank aims to continue to grow and expand its key markets in the region including Qatar, Bahrain, Kuwait and Egypt while maintaining correspondence facilities in London, New York and Hong Kong. As CEO of the bank, Al Ghurair would like to see the bank grow in the GCC region. “I might not want to expand beyond that. We want 25% of our revenue to come from international sources and we’re almost there. Many of our clients are going international and we would like to serve them. Being an advanced banking system in the region we tend to export our services, products, technology, thinking and innovation to the region to give us a larger market share,” he revealed.

Categories: Transaction Banking
Keywords: Mashreq, Innovation, SME, Customer Centricity, SMEXchange
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