by Colin Fraser, Executive Vice President, Head of Wholesale Banking, Abu Dhabi Commercial Bank
Welcome to this inaugural Guide authored by Abu Dhabi Commercial Bank (ADCB) in association with Treasury Management International. In the articles that follow, we would like to introduce you to some of our senior management team, and provide a deeper understanding of the ways in which we support the evolving needs of our clients. UAE is a dynamic group of markets that have already experienced rapid change and expansion. ADCB plays a pivotal role in enabling this expansion, promoting best practices and competitiveness amongst our clients, and cementing UAE’s role as a financial hub for the region.
The birth of a new wholesale bank
Over the 22 years I have spent in banking so far, many of the proudest moments of my career have taken place since I joined ADCB. In 2008, while I was running Barclays’ corporate banking division for GCC, I was approached by ADCB to set up a new wholesale banking business. Since we first launched the business, throughout the crisis and beyond, we have been clear in articulating and delivering on our corporate strategy: ADCB is a universal bank for UAE, and we aim to continue developing market share across all customer segments.
For wholesale banking, this involves fulfilling the critical need amongst our institutional clients for high quality investment and transaction banking solutions, from small and medium-sized enterprises (SMEs) through to large multinational corporations, government entities and financial institutions. Innovation and customer service excellence are at the heart of what we do, enabling us to develop, deliver and support solutions that specifically meet client requirements.
Promoting client success, at home and overseas
This strategy has proved very successful, with strong, sustainable growth across all areas of our business. Cash management, part of our transaction banking business, is attracting a large number of SMEs in addition to our larger institutional clients, with consistently strong customer satisfaction metrics. We are also investing heavily in trade finance, facilitating our customers’ international trade ambitions.
We recognise that to support a client’s needs in international markets, it is essential to have a local presence. For example, given the enormous volume of flows between India and UAE, we established two branches in India. Indeed, such is the success of our IndiaLink initiative that it has become one of the fastest growing parts of our business. This includes supporting a number of large government-owned entities who work with ADCB as their banking partner for India. This has only been achievable as a result of the huge investment we have put into an efficient, secure and automated transaction platform, as Murali Subramanian, head of transaction services, describes.
Apart from exceptional circumstances, however, we satisfy the wider international needs of our corporate and institutional clients through our partnerships with Bank of America Merrill Lynch and Santander. We are also close to securing alliances with local banks in Africa and Asia to offer integrated global coverage with a comparable depth of solutions and services globally that our clients have come to expect locally.
ADCB has been a pioneer of highly successful, integrated banking partnerships. The global financial crisis demonstrated to many banks that they could no longer spread their activities across all parts of the world, and instead needed to focus on their core competences and target geographies, and form strategic alliances to offer solutions and coverage outside these areas. Consequently, while relationships between banks have often existed for many years, these have traditionally been primarily for correspondent banking partnerships rather than focused on providing integrated solutions for clients.
A robust regional partner
ADCB has transformed its business over the past five years. We have a diverse funding mix and strong capitalisation with 20% capital adequacy, resulting in a credit rating upgrade and robust credit default swap spreads. This has been the result of proactive efforts to strengthen our financial resilience and build sustainable, positive relationships with our clients. We are constantly reviewing and stress testing our business to ensure that we can continue to sustain our client obligations and fulfil our strategy. Our liabilities now reflect in real terms the transaction services we offer, and while we are active in wholesale financing, as the interview with Arul Kandasamy outlines, the bank is far less reliant on capital markets.[[[PAGE]]]
Over the next three to five years, we will continue our sustainable growth strategy without compressing margins or compromising our ability to invest in solutions and services for our customers. For example, we are driving increased market share across cash management and trade finance verticals, and SME and mid-cap corporate horizontals in our wholesale banking division, together with retail and wealth management as part of our consumer finance division. In doing so, it is our goal to increase value to shareholders and drive economic growth in UAE.
Excellence and innovation
We know that driving growth and market share is not simply about attracting new clients, but also ensuring that we continue to offer existing clients a positive experience of working with us. While many banks in the region continue to be more transaction-focused, the quality of our relationship management, including our expert advisory services, depth of market and industry insights and integrated approach to solution design and delivery. We continue to make substantial investments in client satisfaction through internal training, robust performance management and both scheduled and ad-hoc customer surveys. Our aim is not simply to understand trends in client satisfaction, but to obtain real-time feedback that in turn shapes our behaviour and enables us to prioritise our investments. For example, as a direct result of client feedback, we have achieved enormous enhancements in process efficiency, control and automation through the development of our flagship transaction banking platform.
A wider market role
We recognise that our leadership role as a universal bank in UAE results in market responsibilities that extend beyond individual obligations to our clients. On one hand, we continue to respect financial practice and culture in UAE and offer trusted, familiar solutions and services to our clients. On the other, we are committed to promoting awareness and adoption of best practices in cash, treasury and risk management for all financial participants and strengthening UAE’s leadership position as a financial hub. For example, while UAE has traditionally been a cash-based culture, we have been actively engaging with consumers and businesses to adopt efficient, secure payment and collection methods such as direct debits that offer security, convenience and certainty for both buyer and seller. As awareness of these opportunities increases, we expect adoption of direct debits and other electronic payment methods to increase, leading to further automation and transparency.
In this Guide, senior executives of ADCB and our clients, discuss some of the ways in which they are promoting and delivering industry best practices in UAE and beyond. We have also provided contact details, so we are looking forward to discussing how we can support your business in UAE.
