National Bank of Abu Dhabi plans to establish eight global banking centres to service corporate clients while also boosting its retail banking business.
Alex Thursby, the bank’s new chief executive, yesterday said its new five-year plan included setting up centres in Abu Dhabi, Lagos, Washington, Mumbai, Singapore, Hong Kong, London and Paris.
It would also focus on providing wholesale services to major companies in the Middle East, Asia and Africa, and build five international banking franchises in countries such as Egypt. NBAD is betting that its high credit ratings from credit ratings agencies will propel its growth as it seeks to attract rich individuals in the Arab world, as well as companies in diverse sectors such as finance, energy and property, according to Mr Thursby. “This is not about carpet bombing all segments of the market place,” he said. “It’s about being very surgical and dominating those places that we want to be.
“Where we choose to play, we want to be the dominant player.
“There are only about 25 commercial banks worldwide that are double A minus or above.”
The state-owned bank has not as been as active as its local rivals, such as Emirates NDB and Abu Dhabi Islamic Bank, in the UAE’s retail banking market. NBAD focuses instead on lending to large government companies. However, the recent upheavals in the region have made the bank an attractive haven to Arab expatriates in the Emirates.
As part of its retail drive, the bank has started to offer new mortgage products. Meanwhile, NBAD is trying to identify countries with burgeoning middle classes in which to establish itself as a niche player, according to Mr Thursby.
Its focus on the developing economies in the Middle East, Asia and Africa is crucial to its strategy.
The bank would not necessarily aim to open branches in all the cities of the countries it was targeting, but it would focus on the capitals or the major cities with the most business opportunities, Mr Thursby said.
“We have to make sure that we’re going to make US$100 million in profit once we start investing in these places. The model will be affluent banking in the retail space, international commercial … and our wholesale proposition,” he said.
Under its five-year strategy, NBAD will divide itself into three core businesses of global wholesale, global wealth and gulf retail and commercial. It will also cut back on some existing activities and focus on bolstering the parts of its retail and wholesale business that will generate the most profits.
For the first nine months of the year, NBAD’s revenue rose 11 per cent to Dh7 billion from the same period last year, and it expected to end the year with a revenue increase of up to 8 per cent, said Michael Miller, the bank’s head of investor relations.