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SBAC to enhance investment in retail and SME sectors

Its top executive tells FE

Siddique Islam | July 08, 2021 00:00:00

Mosleh Uddin Ahmed

South Bangla Agriculture and Commerce (SBAC) Bank Limited has planned to boost its financing in retail and small and medium enterprises (SME) for minimising risk within the next two years, the bank's top executive has said.

Under the plans, the investment in retail and SME will be reached at 50 per cent of its total loans and advances by 2023 from the existing level of 30 per cent.

"We've decided to enhance our investment in retail and SME sectors aiming to facilitate the ongoing financial inclusion initiatives through bringing more un-banked people in the banking network," Mosleh Uddin Ahmed, managing director (MD) and chief executive officer (CEO) of SBAC Bank disclosed while sharing his future plans in an exclusive interview with the Financial Express (FE) recently.

The fourth generation private commercial bank (PCB) has also planned to go digital banking gradually instead of the existing 'brick and mortar' one to provide world-class services to the customers, according to the CEO.

As part of the initiatives, SBAC will set up 50 CRMs (cash recycling machines) each year instead of ATM (automated teller machine) booths aiming to provide better services to their clients.

"Our customers may deposit and withdraw money from CRM at any time. There will be an opportunity to execute all the activities of digital banking including fund transfer. So, customers don't have to wait for banking hours," the CEO explained.

Besides, the PCB will develop an App shortly aiming to facilitate the country's foreign trade, according to Mr. Ahmed.

"Businessmen can easily open their letters of credit (LCs) from their own offices using the App," the CEO said while explaining the benefit of the App.

He also said SBAC Bank has also planned to open 100 agent banking outlets in the southwestern part of the country by the end of this calendar year. "The agent banking operations will help reduce the operational cost of the bank."

SBAC Bank wants to enhance its client-base through strengthening its different services including agent banking network to bring more un-banked people into the banking system.

"More than 50 per cent of the population remains out of the formal banking network in Bangladesh despite different initiatives have been taken by the authorities concerned in recent years," the CEO explained.

"Actually, we want to extend services to the doorstep of our valued customers across the country using the latest financial technology (FinTech) in the near future," Engineer-turned banker Mr. Ahmed said while replying to a query.

FinTech is the new technology and innovation that aims to compete with traditional financial methods in the delivery of financial services using smartphones or the internet.

He graduated in Electrical and Electronic Engineering and also obtained an MBA (Master of Business Administration) from the IBA (Institute of Business Administration) of Dhaka University.

The PCB will try to offer higher dividends to its shareholders through maximum uses of their hard-earned money, according to the CEO.

"Our accountability, transparency, governance and reputation will enhance further after listing with the country's capital market, that would be a big opportunity for us to grow further," he explained.

SBAC's net asset value (NAV) per share stood at Tk 13.18 for the period that ended on September 30, 2020. For the nine-month period, its earnings per share (EPS) were Tk 0.94.

Meanwhile, its weighted average earnings per share for the last five years were Tk 1.24.

The bank's authorised capital is Tk 10 billion while pre-IPO paid-up capital is Tk 6.84 billion, which will stand at Tk 7.84 billion after the IPO.

After completing official formalities, SBAC Bank will be the 32nd listed bank on the DSE.

SBAC Bank has already introduced its Islamic Banking Windows at 10 branches to provide Shariah-based services to the clients in the name of 'SBAC Islami Banking'.

Mr. Ahmed also spoke on different issues including execution of the government announced financial stimulus packages, future challenges for the banking sector, non-performing loans (NPLs) situation and managing liquidity in the near future amid the Covid-19 pandemic.

Describing the government announced different stimulus packages and policy supports of the central bank, the private banker said such supports had helped the banks strengthen their investment capacity, particularly in the real sectors of the economy.

The government has so far announced a total of 23 stimulus packages worth Tk 1.24 trillion to offset the shock of the Covid-19 pandemic in various sectors of the country.

The packages, equivalent to 4.44 per cent of the country's GDP (gross domestic product), are being implemented under the supervision of the central bank and the ministry of finance.

The senior bank also proposed the government for establishing a global standard bank through using the public-private partnership (PPP) model to facilitate trade and investment in Bangladesh.

"The government may choose a good local commercial bank, which has good financial health, for setting up the international standard bank using the PPP model," Mr. Ahmed added.

He also proposed the authorities concerned to adopt a specific plan to curb the coronavirous infections that would help overcome the ongoing uncertainty particularly for trade and investment.

"We should ensure a congenial environment for encouraging both domestic as well as foreign direct investment (FDI) in Bangladesh," the senior banker said while replying to another query.

Mr. Ahmed joined SBAC Bank as MD & CEO on 27 April, 2021.

Prior to his joining at SBAC Bank, he has served as MD of NCC Bank Ltd. He has also served as additional managing director and deputy managing director in the Jamuna Bank Ltd.

Currently, SBAC Bank serves a large customer base comprising individuals and institutions through a network of 83 branches across the country.

Like other banks, the PCB has already set up 12 sub-branches to provide better services to its clients.

SBAC has 210 foreign correspondents across the world as well as having credit lines with 22 banks.

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