Following the successful launch of its Al Hilal Islamic Banking Services with the opening of five dedicated branches in Samail, Saham, Bahla, Rustaq and Muscat, and a sixth branch set to open soon in Salalah, Ahlibank is confident that Islamic banking will be a great success in Oman.
In an interview with Muscat Daily, Abdul Aziz al Balushi, chief executive officer of Ahlibank, said that depending on the actual requirements, the bank may convert some of the existing conventional branches to Islamic banking ones or may even open more new Islamic banking branches. “The primary objective for this year is to really establish credibility by educating people about what Islamic banking is by explaining to them how true and transparent we are to clear people's negative perception about Islamic banking,” he said.
Balushi said the bank doesn't want people to feel Islamic banking is free or a charitable business, rather it's the same as other commercial business. “Our focus this year is to create awareness. The launch of five branches with the sixth one soon, will bridge the gap between society and the bank in order for them to know what Islamic banking is. They will also help in building our name and brand in the Islamic banking sector,” he said.
On the bank's Islamic banking services, Balushi said services, products and dealing are built on the tenets of truth and transparency, and are in accordance with sharia principles to ensure that the bank is committed to providing the best products that the market has to offer. “In terms of our Islamic banking services, we have separate capital, different systems and dedicated staff of about 50 personnel who all work according to the sharia system approved by our sharia board. We believe that we offer superior services and products,” he said.
“Convenience to our clients is also our top priority. We go to where our clients are. As you can see, other banks have opened Islamic windows only in Muscat but Ahlibank has opened in different regions. We go to customers instead of them coming to us,” he said.
On Al Hilal Islamic Banking Services investors, Balushi said, “We came up with the rights issue of RO25mn and that is the capital, and we have the sharia board that looks after how the money is spent. In Oman in general, all the Islamic banking windows are sharia compliant. We are more stringent and compliant than other Islamic banks in the GCC. The systems are different and funds that we collect from investors are not going to be used by non-sharia businesses. We see we are more competent because of the support we have from our partners. We believe we can outperform the market,” he said.
Going forward, Ahlibank is planning to take its services to the next level of growth. “Our plan is to further grow our book and maintain its quality, diversifying our business in terms of product offerings and increasing our client base and attaining the best in class efficiency gauging ratios. Our customers will be our top priority and we will strive to provide them with the best service,” he said.
“Simultaneously, we plan to build and develop a pool of professional bankers and create opportunities for Omani youth. Our commitment to the society stays and we will endeavour to meet the aspirations of all stakeholders to the best of our ability. All of this we plan to achieve in a prudent way by clearly identifying and acknowledging associated risks as we move along,” he added.
As a full fledged commercial bank now, Ahlibank has completed five years of successful operations and has created a strong and reliable brand in the country. “The strategy going forward is to ride on this strong foundation and the brand which we have created for further growth of the business. These growth plans will include both organic and inorganic as well as expanding the services with the introduction of Islamic banking and investment banking. Along with our strategic partner Ahli United Bank, our commercial banking team is fully geared to encash the opportunities arising from the new projects announced by the government in the budget,” Balushi said.
On Oman’s economy, Balushi said, “We are quite upbeat on the prospects of the sultanate’s economy. The growth-oriented budget announced by the government along with the list of new projects announced is very impressive and is in line with His Majesty the Sultan’s vision of creating employment opportunities for the Omani youth. The government’s efforts to diversify the sultanate’s economy has thrown up numerous opportunities for the banking industry in general and the entire economy on the whole.
“However, in the long term, sustainability will be an issue. Banks with strong risk management policies, corporate governance structures and excellent customer services will emerge stronger than others.”
Speaking about Ahlibank’s success, Balushi said it stems from the loyalty of its customers and the bank’s commitment to providing them with the best possible service. “The bank has a very strong risk management framework and our success is due to the emphasis on teamwork and the commitment and dedication from the whole Ahlibank team. To achieve such great results we benefit from the strong support of our shareholders and strategic partners, along with the wise guidance of our Board of Directors,” he said.
Looking forward to the next ten years, Balushi said, “We want to be recognised as the best bank in Oman, not in numbers but in services and returns to stakeholders. With the current six per cent of market share, we look forward to achieve ten to 15 per cent market share in the next three years. We are optimistic but we have to be cautious because globally, the economy is not doing so well,” he said.
“The bank has received a number of awards during the past few years and these awards are a recognition of the standards that we have set for ourselves imbibing the best ethical practices set in the industry the world over. We believe these standards to be dynamic and therefore constantly and consciously raise the bar on them more in the spirit of competition from within.
“I attribute the successful performance of the bank to our focused approach to doing business which enables us to maximise the efficient use of our resources. This is reflected in the growth of our balance-sheet and revenue, at the same time the reduction of our costs, all of this has contributed to the increase in our net profit. We aim every year to have a substantial improvement in our efficiency measuring ratios and this has always been a team effort at Ahlibank,” he said.