“Of course, we had to allocate additional precautionary provisions to support the bank’s financial position, and to bolster our ability to face any future repercussions of the ongoing Covid-19 crisis, which is normal as a result of this unprecedented crisis; a first in modern times.”, he added.
Mr. Al-Shaya referred to the growth of the total consolidated assets of Boubyan Bank Group by 21% in the 2020 year to reach KD 6.4 billion. This was achieved through Boubyan Bank’s acquisition of Bank of London and The Middle East “BLME” during Q1 of this year in addition to the growth in the consumer and corporate finance portfolios in Kuwait by 14% and 11% respectively.
Moreover, the total of customer deposits grew by 17% to reach KD 5.1 billion, while the financing portfolio grew by 26% to reach KD 4.8 billion, and operating income grew by 15% to reach KD 167 million.
Speaking of the bank’s market shares, the bank’s share of local financing increased to exceed 10%, while Boubyan Bank’s share of retail finance grew to approximately 14%, thereby positioning Boubyan Bank in the third place among local banks in terms of the market share of the domestic financing portfolio.
Mr. Al-Shaya went on to explain: “Despite the robustness of the bank’s financial position, the adequacy of its capital, the growth of its business volumes and operating profits, the bank has decided not to distribute cash dividends for this year in order to strengthen the bank’s balance sheet, taking into consideration the exceptional circumstances the international and local economy are going through due to the Covid-19 pandemic which we have not fully overcome yet.”
How Boubyan Bank Dealt with the Crisis
Boubyan Bank’s Vice-Chairman & Group Chief Executive Officer, Mr. Adel Abdul Wahab Al-Majed stated: “During the crisis, the bank’s human resources demonstrated that they were able to face the difficulties and the risks caused by Covid-19, and this ability manifested itself when the bank continued performing in the best manner, without failing to serve customers owing to the skills of our staff who worked throughout the crisis.”
Al-Majed highlighted some of the most significant initiatives of the bank during the crisis, starting with the bank’s contribution to the KD 10 million fund established by the Central Bank of Kuwait, and co-funded by Kuwaiti banks, to support the government’s efforts to fight the Covid-19 outbreak.
Furthermore, the bank dedicated its resources in implementing the resolution of deferring all the installments of financing and credit cards for all customers in addition to deferring the installments of SMEs without charging any additional profits or other charges.
Al-Majed went on to add: “During this crisis, we reaped the fruit of our investment in our digital banking services. Since the beginning of the crisis, we noticed the growing usage of our digital banking services by our customers whether through the bank’s website or the bank’s mobile App.”
In April 2020, the bank started supporting applications for concessional financing announced by CBK as a part of the stimulus package to support corporate & SMEs' customers impacted by the ongoing crisis.
Al-Majed thanked all entities that managed the crisis, especially front liners, and additionally thanked CBK for the measures taken by it, which mitigated the severity of the crisis.
Excellence in Retail Banking Services
As per Boubyan Bank’s efforts over the past years to be the leader in digital banking services, the bank excelled during the Covid-19 pandemic in maintaining seamless provision of banking services and products while ensuring customer satisfaction in addition to exceeding market expectations in this field.
Consumer preference grew with regard to our digital banking offerings amid the pandemic. The pandemic encouraged customers to rely on digital technology including digital means of communication and chatbots, therefore, the bank’s strategy in digital banking services relies on our passion to make our customers the central focus in all of our activities.
Over the past year, Boubyan expanded its branches’ network and remodeled its customer services across the country by refining its processes to ensure swift and smooth customer services based on our understanding of the banking services needed by customers.
The bank further expanded its Boubyan Direct network by providing 38 devices operating 24/7 allowing customers to deal face to face with the bank’s agents to offer them integrated banking services such as discussing financing and credit options in addition to opening accounts and performing transactions which may not be easily performed digitally. Moreover, the Banks’ network of 249 ATMs are well distributed to offer our usual services in addition to issuing new debit cards, while enabling customers to perform their banking transactions.
Corporate and Mega Projects
Despite the crisis caused by the outbreak of coronavirus, the Corporate Banking Group maintained a balanced growth in its corporate financing portfolio within the range of 11% despite the tough competition in corporate financing during the past year, ultimately increasing its market share to 9 % approximately.
The extended financing was diversified across key productive sectors such as oil, energy, service, industrial and real estate sectors in addition to representing a key and effective contribution to a number of mega projects benefiting the national economy. This was achieved by attracting new customers coupled with the bank’s existing customers without compromising the quality of the finance portfolio through the continued application of the Bank’s prudent credit policy.
The group was keen to adopt the latest technological advancements in banking services provided to this important sector by adding various services to the Boubyan Corporate App and the corporate online banking services, while adding new products and allocating exclusive branches to provide all banking services to the corporate segment.
Al-Majed referred to some of the major achievements in 2020 which included Boubyan Bank’s success in its regional and international offering of its debut unsecured sukuk under the umbrella of a sukuk program with total bids amounting to USD 4.6 billion approximately, i.e., the issuance was oversubscribed by more than six-fold over the targeted amount (USD 750 million Dollars), with the sukuk being subsequently listed on the Irish Stock Exchange.
During Q1 of this year, Boubyan Bank announced its acquisition of additional shares in BLME, amounting to 45.25% approximately. Accordingly, total holding grew to approximately 71% of BLME’s ordinary issued shares after adding the shares already owned by Boubyan Bank Group.
Al-Majed stressed: “Increasing our shareholding in BLME will help us develop its business and grow both banks. Following the completion of the acquisition, Boubyan Bank’s intention is for BLME to continue to work as an independent bank as a part of Boubyan Bank Group.”
Moreover, Al-Majed mentioned that excavation and construction operations are well underway on the new head office building of the bank, which is expected to be welcoming Boubyan’s employees within 4 years, God willing. The building will be erected over 4,000 m2 and will be an artistic icon inspired by the logo of the bank.
Furthermore, Boubyan Bank continued to top the pyramid of customer service in Kuwait, supported by earning two awards from Service Hero, the international consumer-driven customer satisfaction index. The bank received the First Place Award in Customer Service as a Country Winner for the fifth time in addition to being named the Best Islamic Bank in Customer Service for the tenth year in a row since 2010. Additionally, the bank received the Decade's Award for the best Islamic bank.
The bank was also named the World's Best Islamic Digital Bank for the sixth consecutive year and the 2019’s Best Islamic Bank in Kuwait by Global Finance for the fourth consecutive year in addition to being named the Best Islamic Bank in Kuwait by The Banker.
Our Human Resources and Our Corporate Social Responsibility
Despite the Covid-19 crisis, the bank continued to support the national cadres, thereby maintaining its leadership as the top private sector institution with a national manpower percentage of 76.5%. At the same time, the bank continued to attract female cadres to the bank, and now female employees account for 26% of the total workforce of the bank.
The bank continued its social activities as a delegation of Boubyan Bank’s senior management, accompanied by Boubyan Bank’s Team of Volunteers, visited the General Department of Civil Defense and Kuwait International Airport, Terminal 4, in coordination with Kuwait Red Crescent to thank them and thank all volunteers for their efforts. This visit was a part of an initiative by Boubyan Bank and its volunteers to show appreciation for the most important entities standing at the front lines to fight the coronavirus risk.
Boubyan Bank did not forget about supporting our brothers in Lebanon amid the disaster that afflicted them last August as a result of the explosion that rocked Downtown Beirut, following which the bank made a financial donation to Kuwait Red Crescent to help with the various relief and reconstruction efforts in Lebanon.
In response to the constant calls from competent authorities to stay at home, Boubyan Bank continued organizing many events and activities through social media platforms and other online platforms.
Additionally, the bank broadcasted many awareness messages about how to fight Covid-19 and the relevant prevention measures via the bank’s social media platforms as well as holding many weekly competitions, thereby creating a bond between the bank and its followers across its social medial platforms.
© Press Release 2021