Commercial Bank of Dubai (CBD) is a UAE-based banking and financial services corporation headquartered in Dubai. CBD is ranked as the number one bank in the UAE on the Forbes list of the World’s Best Banks 2022. Othman Ibrahim Bin Hendi, Chief Customer Officer at CBD speaks about the UAE’s banking sector in general and the strategic positioning of CBD in an exclusive interview with The Integrator!

How well do you think small and medium enterprises (SMEs) and large enterprises are supported by UAE banks? Differentiate CBD from the rest?

SMEs are the backbone of the UAE economy, accounting for around 94% of businesses in the country. In recent years, the UAE government has implemented several policies to boost economic growth by enabling businesses and entrepreneurs and increasing their contribution to the economy.

The financial services industry is crucial in helping SMEs navigate a challenging climate. In line with the UAE Government’s focus on SMEs, banks are supporting SMEs by striving to understand their businesses and developing products and services that suit their needs and minimize risk.

As one of the UAE’s first and most reputed banks, CBD has always differentiated itself from the other competitors by being a bank focused on family-owned and managed businesses across the Emirates in the UAE. Over the years, it has supported numerous SMEs that have later grown with us to become large corporates.

Further, we have partnered with several government entities such as the Dubai Economic Department and Free zones, such as JAFZA, DMCC, DCAA, EFZA, Meydan, and RAKEZ to offer a full suite of products that are specially tailored for the SME segment to fulfill their business requirements and back their ambitions.

With the “Best Technological Innovation in Financial Services” award, CBD has been recognized at Seamless 2022. What innovation did make CBD achieve the award?

The “Best Technological Innovation in Financial Services” award was presented to CBD for its CBD Investr app, which is the first robo-advisory investment solution in the region offered by a bank. The innovative investment app is powered by smart algorithms that actively manage investment portfolios to deliver optimal risk-adjusted performance.

Through the CBD Investr app, customers can conveniently access a globally diversified and personalized portfolio of stocks, bonds, and other asset classes using low-cost exchange-traded funds (ETFs) aligned to investors’ risk profiles.

The app offers customers the option of robo-advisory portfolios or investing on their own through the self-investor option. Robo advisory portfolios are managed by smart algorithms to deliver optimal performance without customers needing to manage and track the markets. The self-investor option allows customers to buy and sell their preferred shares and ETFs in real-time, thus providing a more personal and customized experience.

Tell us about the recent global achievement of CBD of getting included in the Forbes List of the World’s Best Banks 2022

CBD has been named the number one bank in the UAE on the Forbes list of the World’s Best Banks 2022, based on key customer satisfaction metrics including trust, fees, digital services, and financial advice.

The Forbes fourth annual ‘World’s Best Banks’ report, published in conjunction with market research firm Statista, surveyed more than 45,000 customers across 27 countries around the globe for their opinions on their current and former banking relationships.

This global recognition is an affirmation of our customers’ trust in us to back their ambitions, and it also proves the success of our customer-centric strategy.

Elaborate on the performance indicators of the Commercial Bank of Dubai (CBD) and, as one of the longest-established banks, what role does it aim to play in 2022 and beyond?

The bank has delivered a net profit of AED 866 million for the first half of 2022, up 28.1% compared to the first half of 2021. Higher revenue across net interest and other operating income generated a strong increase in net profit. Market interest rates have risen, and solid loan growth resulted in higher revenue in the first half. Whilst the global macro-economic environment is challenging, the outlook for the UAE economy remains positive. The solid return on equity generated internal capital for growth while the bank’s liquidity position remained robust with the advances to stable resources ratio at 89.35% as of 30 June 2022. All capital ratios were well above the minimum regulatory thresholds mandated by the UAE Central Bank.

In 2022, we will continue to be instrumental in driving digital transformation and investing in enhancing technological capability to provide our customers with a best-in-class banking experience. For the first half of 2022, 98% of our wholesale banking transactions were initiated digitally, and we achieved a 102% increase in mobile banking transactions. Our app was rated 4.8 on App Store and 4.7 on Google Play Store.

We will also continue to back our customer’s ambitions by enhancing our products and services to fulfill the evolving needs of our customers and initiate strategic partnerships to support customers in achieving their financial goals.

Backing the nation’s ambitions and supporting the UAE’s Government initiatives is also one of our top priorities, and the launch of the CBD Digital Lab demonstrates that. The CBD Digital Lab is the first initiative by a bank to establish an R&D facility in the DIFC Innovation Hub, which aims to create a collaborative ecosystem in the FinTech sector by fostering innovation and supporting integration between financial institutions and fintech start-ups.

The Digital Lab will not only drive the future of finance and the future economy, but it will position the UAE as one of the world’s most innovative nations and a global hub for innovation and technology. Further, it reaffirms our efforts to become “default digital” and expand infrastructure in financial technology, unlock innovation opportunities, and introduce new and innovative financial products to the market.

How do you evaluate the post-pandemic banking situation in the UAE, and what reformative actions can be expected from banks?

We have recently announced our financial results for the first half of 2022. The positive results that we have achieved indicate that we are in a recovery mode and returning to pre-pandemic profitability levels.

The pandemic has forced banks to evolve and adopt new business models. A bank’s success in the future will be based on its ability to be agile. The landscape of the financial sector is changing dramatically. With technological disruption, the emergence of new entrants, both fintech and digital giants, and constantly evolving customer expectations, organizations are forced to continuously adapt to these changes and deploy an agile organizational model.

At CBD, digital transformation and innovation are fundamental to our ongoing success. We will continue to invest significantly in these areas to ensure we provide our customers with a convenient and seamless banking experience.

Can you tell us more about CBD’s ESG and Sustainability initiatives?

As an organization backing the ambitions of our proud nation, CBD remains committed to operating its business in a sustainable manner, aligning with the UAE’s efforts towards sustainable development, empowering local communities, and preserving the environment.

In 2021, CBD initiated an ESG transformation journey. We have consolidated ongoing and future environmental, social, and governance initiatives under a common ESG Framework governed by an ESG Committee, which is accountable to the CBD Executive Committee.

Our ESG Framework sets out the key initiatives we believe we must undertake as a responsible corporate organization. We firmly believe that every employee in the Bank, and every citizen and organization in the UAE, has a role to play in sustaining our future.

It is an incredible time to be a part of this great nation, particularly as the UAE readies itself to host COP28 in 2023. We are determined to play our part in driving the sustainability agenda and backing the ambitions of the UAE.

Below are some of the key initiatives that we have undertaken:

• CBD financed a government entity undertaking the development of a 300,000 tons per annum multi-fuel conventional-based Waste-to-Energy (WTE) facility and associated power substation in the UAE. The project will help the Emirate of Sharjah reach its zero-waste-to-landfill targets and help the UAE achieve its goal of diverting 75% of solid waste from landfills.
• CBD financed a consortium of companies that has been tasked to build and operate the expansion of a major solar park in the UAE. The solar park is one of the world’s largest renewable projects based on an independent power producer (IPP) model.
• We have already begun reviewing the assets currently on our books. Additionally, we see potential opportunities in green repos and green trade loans. Our green product exploration is further supported by an emphasis on sustainability as part of our employee innovation challenge.
• We are expanding upon our procurement framework to ensure that we are not only promoting local suppliers but also suppliers who have a demonstrable dedication to the environment.
• We have reduced our paper consumption by 47%. Additionally, our consumption of plastic water bottles was reduced by 28%.