By the end of 2012, we at Boubyan Bank had completed the first three years of our Five-Year Strategy (2010-2014). The strategy has certainly realised many of its objectives; last year, we returned to profitability and were even able to pay dividends to our shareholders.
The realisation of these strategic objectives can be attributed to a key set of factors: our return to core banking activities; and expansion within the Kuwaiti market by providing our corporate and individual products and services in a fresh manner. The latter, in particular, led to our becoming more competitive and resulted in a rise in our market share. In 2010, we set ourselves the target of having 30 branches by the end of 2014: by the close of last year, we already had 22 and are planning to open six or seven more this year. All are, or will be, in residential areas with large populations, so we can be closer to our customers. By the end of 2014, we now expect to have exceeded our pre-set goals.
Direct market research
In order to maintain our excellent level of service, the Bank offered a variety of products and services targeting different sections of society. Some of these products were not new to the Kuwaiti market, but we remain the sole provider of others. Instead of relying on the common draw of prizes, we chose to adopt a different, more distinguished style of promotional campaigns, under the slogan “With Boubyan, all are winners”. As part of our strategy, we continued to focus on products and services targeting affluent customers with high net worth.
Number of branches planned by the end of 2014 (2010 target): 30
Number of branches already open by the end of 2012: 22
We launched the Platinum Banking service in response to our market research, which showed a dire need for such elite banking services in the local market. We continued to develop the services we provided private banking customers, by offering them greater privacy, quicker transactions and a highly professional manner. Our figures give us reason to maintain an optimistic outlook. We managed to lift our market share to decent ratios for a short period, despite fierce competition in the Kuwaiti market – particularly in the provision of Islamic banking. By the end of 2012, we had achieved a market share of 4.7 percent (from 2.3 percent in 2009) and raised personal finance to 5.7 percent (from 1.2 percent in 2009).
By soliciting productive companies known for their economic and fiscal solvency – while adhering to the highest standards of creditworthiness, risk studies and diversification – Boubyan Bank managed to realise growth rates of 23 percent in its credit portfolio in 2012: one of the highest growth rates in the Kuwaiti market.
During 2012, our corporate banking group arranged and managed syndicated finance transactions with local and international banks for various companies. One financial transaction managed by Boubyan Bank on behalf of the Kuwaiti Mobile Telecommunication Company Zain, for example, was worth $175m.
Our human resources
In August 2009, the National Bank of Kuwait acquired a significant stake in Boubyan Bank. NBK brought with it long-established expertise, which played a major role in setting Boubyan Bank’s strategy, re-launch and expansion within the Kuwaiti market. In 2012, NBK increased its stake in Boubyan Bank to 58 percent, but continues to emphasise the complete separation of the entities on a operational level. Boubyan Bank has continued to receive regional and international recognition for its work. These have included: Service Hero’s Best Islamic Bank in Kuwait for Customer Service two years in a row; Best Islamic Bank in Elite Credit Card Services and Fastest Growing Bank in Kuwait from The Banker Middle East Magazine; and Best Islamic Bank in Kuwait from Arabian Business.
Since we began implementing our new strategy in 2010, we at Boubyan Bank have understood that we cannot achieve success without the best human resources. We have sought out the most distinguished professionals in the local markets while developing the capabilities of all our staff. By focusing on Kuwaiti youth, we have been able to raise our national labour ratio to more than 64 percent: one of the highest in the private sector. In 2012, we launched the ITQAN Academy: an advanced and innovative model for training human resources and developing young Kuwaiti leaders. This academy is the first of its kind among local and regional banks and – was established in cooperation with the Gulf University for Science and Technology, which acts as the “exclusive academic partner” for Boubyan Bank in Kuwait.
Boubyan Bank managed to realise growth rates of 23 percent in its credit portfolio in 2012: one of the highest growth rates in the Kuwaiti market
We consider social responsibility and service to be the cornerstones of the Bank’s dealings with all sections of society; it is key to the development and building of a society that is able to confront all regional and international variables. Boubyan Bank has pioneered many social responsibility initiatives and supported various activities and events. These initiatives have targeted many different sections of society, but with a particular emphasis on young people and those with special needs. These have included “The Big Tree Society” initiative, organised for Kuwaiti schools by the Bank, in cooperation
2015 and beyond
We have an optimistic outlook for the future of Islamic banks and financial institutions, both in Kuwait and the surrounding region. The increasing demand for Islamic banking and financial products and services – among Muslims and non-Muslims – has much to do with both sharia, and the products, services and banking solutions that keep pace with advancements in all areas of life.
Our current strategy is due to come to an end in 2014, but we already have plans on where to take Boubyan Bank after that. Having strengthened our position in the local market, our ‘2020 Strategy’ will see us expand into external markets. While there may be further opportunities within Kuwait, they will always be limited in comparison to our aspirations.