Text size:

  • Small
  • Normal
  • Large
Ajman Bank expects to open up to five branches in the coming year, bringing its total number of branches nationwide to 13. Jeff Topping / The National
Ajman Bank expects to open up to five branches in the coming year, bringing its total number of branches nationwide to 13. Jeff Topping / The National

Smaller banks picki up the slack

Small lenders in the UAE seek to beef up their branch networks and staff numbers this year, as international banks make cutbacks.

Smaller UAE banks are hiring staff, opening branches and rolling out new products at a rapid clip while their larger counterparts struggle with job cuts and the cost of regulation.

Al Hilal Bank, an Islamic institution fully owned by the Abu Dhabi Government, expects to hire 100 employees this year and open four branches, taking its total to 23, said Mohammad Zaqout, the bank's head of personal finance services.

Ajman Bank similarly expects to open up to five branches in the year ahead, bringing its total number to 13, said Asad Batla, its head of retail banking.

Other small lenders are also expanding.

"It's what we'd expect in the cycle of things," said Raj Madha, a financial analyst at Rasmala Investment Bank. "After the financial crisis they've started to look at growth again."

Emirates Islamic Bank is in the process of adding 170 staff and opening five branches this year, said Faisal Aqil, the bank's deputy chief executive. The Sharia-compliant lender, which is owned by Emirates NBD, plans to resume "aggressive" lending, he said.

United Arab Bank, a lender which is based in Sharjah, has also announced plans for four new branches this year, said Paul Trowbridge, the bank's chief executive.

The bank has also lowered interest rates on mortgages and announced plans to target UAE nationals as it makes inroads into Abu Dhabi.

The spate of hiring among small lenders comes as bigger financial institutions in the region are laying workers off. So far this year, HSBC Middle East, Barclays Bank and Shuaa Capital have all cut staff numbers in the UAE.

Al Hilal and Al Ajman are also shifting their customer focuses towards women and high-net-worth individuals.

This follows a change in regulations by the Central Bank that has capped loan fees and limited personal lending.

"Gone are the days where you could launch anything and everything and it would work," Mr Batla said. "Now you have to seek safe sections where people are not leveraged and not overburdened with debt."

Mr Madha was unconvinced, however, that strategies based around "red carpet" banking, or offering additional services without any added value, would prove particularly fruitful for small lenders looking to expand.

"That's exactly what the banks were competing on for the last 10 years," he said.

"Many of the larger banks are now making the next step towards a product-rich private banking offering."

ghunter@thenational.ae

Back to the top

More articles


Editor's Picks

 Cityscape Abu Dhabi 2014 will run until April 24, 2014. Fatima Al Marzooqi / The National.

In pictures: Cityscape Abu Dhabi 2014 opens
at Adnec

Key developments and master plans are being unveiled at this year’s property exhibition in the capital.

 Marina Square apartments Reem Island: Q1 2% rise. Studio - Dh65-68,000. 1BR - Dh75-95,000. 2BR - Dh110-145,000. 3BR - Dh170-190,000. Q1 2013-Q1 2014 no change. Sammy Dallal / The National

In pictures: Where Abu Dhabi rents have risen and fallen, Q1 2014

Find out how rental prices in the prime locations in Abu Dhabi have altered during the first three months of the year and the current rates you will pay according to data provided by Asteco.

 Designed by London-based Thomas Heatherwick, founder of Heatherwick studio, the park will feature an outdoor cinema, an organic garden, picnic areas and cafes and restaurants. Photo courtesy Salama bint Hamdan Al Nahyan Foundation

Futuristic Abu Dhabi park to be built in the desert shade

Spread over 125,000 square metres, Al Fayah Park, on Airport Road, will be covered by a sand-coloured canopy, 20 metres high, with the appearance of cracked desert land from above.

 Room with a view from one of the 21 duplex penthouses located in the Gate Towers sky-bridge. The sports courts and swimming pools can be seen below. Courtesy Alda

In pictures: Aldar’s Gate Towers Penthouse Collection on Reem Island

Aldar launched its Gate Towers Penthouse Collection at Cityscape Abu Dhabi. The launch features 21 penthouses spanning the skybridge, with each having a private indoor pool and incredible views.

 The Wind, Energy, Technology and Environment Exhibition takes place from April 14 to April 16. Above, the Dewa showroom during last year’s Wetex. Jaime Puebla / The National

April corporate and economic calendar for the UAE and overseas

From Cityscape to Wetex to stock-market holidays to nations reporting first-quarter GDP figures, here is our helpful calendar of April's business events in the UAE and internationally.

 Get the latest information on credit cards, bank accounts and loan products in the UAE. Mark Lennihan / AP Photo

Rates report: Latest on UAE loans, accounts and credit cards

Souqamal.com brings you the latest interest rates on banking products in the UAE.

Events

To add your event to The National listings, click here

Get the most from The National