Bank Audi Egypt aims to increase its small and medium-sized enterprises (SMEs) loan portfolio to EGP 5bn by the end of 2019, in line with the Central Bank of Egypt’s (CBE) SMEs initiative, Mohamed Bedeir, managing director of Bank Audi Egypt, told Daily News Egypt.
Bank Audi, one of the major players in the banking market, has a total retail finance of EGP 7.3bn at the end of September 2019, representing 26% of the total loans and facilities portfolio, which recorded EGP 28.1bn in this period.
Daily News Egypt interviewed Bedeir to find out the bank’s latest plans, digitalisation efforts, and performance in 2019.
By Hossam Mounir
What are the main features of the bank’s business strategy in the coming years?
At Bank Audi, we always put our customers first by reviewing the bank’s strategy quarterly according to the economic changes on the local and global levels. The bank has a strong growth plan to further expand in the Egyptian market.
Currently, the Egyptian government is focusing on digitalisation of the economy. This comes in line with Bank Audi’s continuous close monitoring of the latest worldwide technological trends in all relevant industries. The bank took serious steps in this respect, as it has collaborated with one of the international professional services firms in order to develop a medium-term digital strategy that encloses course of actions and initiatives. These initiatives include rethinking of the organisation processes, services, and roles from a technology-enabled perspective.
What are the main indicators of the bank’s performance related to the deposits and loans portfolios and the size of profits?
The bank’s total retail finance reached EGP 7.3bn at the end of September 2019, representing 26% of the total loans and facilities portfolio, which records EGP 28.1bn in this period. The bank’s non-performing loans (NPL) portfolio is also among the best in the Egyptian banking sector, reaching 4% in line with the international ratios related to NPLs especially after the application of the International Financial Reporting Standards (IFRS) starting from 2019.
As of 30 September, the bank’s performance indicators showed total assets of EGP 71.7bn, net loans of EGP 26.8bn, total shareholders’ equity of EGP 6.8bn, total customer deposits of EGP 62bn, and net profit of EGP 1.088bn. Bank Audi targets profit growth of around 20% per annum.
What are the latest developments regarding the SMEs financing, and how large is the bank’s SMEs portfolio?
The bank’s management is keen on supporting the CBE initiatives. The CBE backs SMEs being the main pillar of the economic development in any country, decreasing unemployment rates and reducing poverty. At Bank Audi Egypt, we target an increase in the SMEs portfolio to EGP 5bn by the end of 2019.
What is the bank’s strategy regarding mortgage finance?
Bank Audi Egypt provides a competitive mortgage loan programme with many benefits, and one of these benefits provide clients with a flexible repayment period up to 20 years. Moreover, the bank has highly experienced sales team to help clients choose the right unit that suits their needs.
How many branches does Bank Audi have in Egypt, and do you have a geographical expansion plan?
Bank Audi has a strategic plan to further expand in the Egyptian market. We aim to open new branches before the end of 2019, and we successfully opened some since the beginning of the year in different areas, including Port Said Port, Cairo International Airport, Fifth Settlement, Shebeen El Koum, Damanhour, and Ismailia.
The new branches offer clients the best products and services being a pioneer in providing competitive retail banking products and services in the market. Bank Audi has 52 branches, of which 49 are offering conventional banking services and products, while three branches offer Islamic services and products. By the end of 2019, our branches will reach 55, of which four will be dedicated to Islamic banking and the remaining 51 will be conventional branches.
What is the bank’s recent position regarding NPLs, what is the size of provisions set aside to cover them?
Banks play a key role in the development of Egypt’s economy. As the boundaries and aspects of development expand, a more flexible and sophisticated banking system is needed. Our bank can only support businesspeople and big corporates to restore financial stability and position after drawbacks which will only benefit the Egyptian economy. We are proud to announce that bad debts in Bank Audi Egypt do not exceed 4%, which is one of the best ratios in the Egyptian market. As for the provisions dedicated to cover the risks in the bank, they recorded EGP 350.575m as for September 2019.
How much is the capital of the bank currently, and do you intend to increase it during the coming period?
As of 30 September, the paid-in capital of the bank was EGP 2.152bn, while its total capital is EGP 6.850m with a capital adequacy ratio of 22.03%, while the minimum ratio set by the CBE’s regulations is 12.50%. Bank Audi Egypt is constantly increasing its capital since it was established in 2006.
What is the role played by the Bank in spreading financial technology and electronic payments in the Egyptian market?
Bank Audi recognises the importance of being at the forefront of technological change by offering e-payment and alternative solutions. So, we provide our clients with the latest technologies in our e-payments platform.
The bank offers Audi Online, a secure, fast, and flexible platform that allows clients to manage their money at their convenience, and its number of users reached 56,000. Moreover, the bank offers “Audi2Pay” mobile wallet application. It’s a new easy, secure, and smart tool that allows clients to make everyday payments directly from their smartphone, that currently serves around 15,000 clients.
Moreover, Bank Audi implements 3.17m financial transactions through its ATM network.
In 2019, we succeeded to divert 40% of retail transactions from traditional banking to digital channels, including ATMs and online banking, up from 5% in 2018.