Abu Dhabi: Al Hilal Bank, an Abu Dhabi-based Islamic bank, is aiming to become a leader in smart banking in the UAE over the next five years, with plans to boost its mobile and computer applications, according to Mohammad Berro, the bank’s chief executive officer.
In an interview with Gulf News, Berro said the bank was reducing its reliability on branches and focusing on smart banking instead.
“Our strategy does not call for mass branch expansion. We’re less dependent on physical branches, yet we’re growing. We’re not stopping our expansion but we’re coupling our branches with our technology and smart banking that we’re getting into slowly,” he said.
Outside the UAE, Al Hilal is currently only present in Kazakhstan where it set up three branches over the past five years.
“We have a study and a plan ready for expansion, and we’re ready for any time we find the right opportunity, but there’s nothing specific at this stage. We are looking at some countries, but it’s still early to discuss that,” Berro said.
He was speaking on Tuesday at the inauguration of the bank’s latest branch in Masdar City, Abu Dhabi’s sustainable eco-city. The launch is in line with Al Hilal’s efforts towards being environmentally friendly and smart.
Berro also discussed the Islamic banking sector in the UAE, saying that it is expected to continue seeing positive performance.
“[Islamic banks] are outgrowing the conventional banks seen by the increase of Islamic banking assets versus the total banking assets. Islamic banks are evolving very well and filling the gaps they’ve had, and that’s why even conventional banks are having their Islamic arm because there’s demand and it’s growing.
It’s too naïve to say that [Islamic banking] will overtake but I can say that conventional banks will have a tougher time competing,” he said.
However, he expected such growth to be limited to the UAE and other countries in the GCC due to the profile of the customer base.
With only one shareholder, Abu Dhabi Investment Council, Al Hilal Bank is not publically listed. It has, however, issued sukuk, with the latest being $500 million (Dh1.83 billion) worth of Tier-1 sukuk in mid-2014.
“Our programme is bigger than what we have issued. [Sukuk] is always ready for the right time to be launched. Issuing sukuk is dependent on many variables, which we continuously monitor, and if the time is right, we can issue,” Berro said.
Asked about the impact of falling oil prices on Al Hilal, the CEO said he was not too worried especially since the bank operates on a relatively small scale (without much presence internationally and with small market share).
Berro said that though the bank might see an impact from oil prices, it would not be considerable, adding that hiring schemes have not been altered.
