Credit Agricole Egypt has an ambitious plan to become a leading innovation-driven sustainable bank, to re-affirm its position throughout the different sectors of its operations while serving the national goals and supporting the local economy, the bank's Managing Director Pierre Finas said. In an interview with Daily News Egypt, Finas stressed that the bank's strategy stems from its raison d'être "working every day in the interest of our customers and community". What are the main features of Credit Agricole Egypt's strategy in the coming years? Credit Agricole Egypt's strategy stems from our Group's raison d'être "working every day in the interest of our customers and community. In this sense, we have an ambitious plan to achieve our objective, which is to become a leading innovation-driven sustainable bank, to re-affirm our prominent position throughout the different sectors of our operations while serving the national goals and supporting the local economy. Definitely, our clients' satisfaction is on top of our priorities and drives our attention towards the quality of services and the customer experience. Thus, we are pursuing our fast steps to offer value-added innovative products to satisfy their needs and ambitions in addition to a convenient multichannel access that is both fully human and digital. Finally, we are proud to say that our plans and efforts are in line with the dissemination of the digital culture which is aligned with the Central Bank of Egypt's (CBE) initiatives to move towards a cashless society. What are the main indicators of the bank's performance to date? Credit Agricole Egypt registered a net profit of EGP 1.868bn in the third quarter of 2019, representing an increase of 11.5% compared to the same period a year earlier, which reflects the continued commercial growth and operational efficiency. Furthermore, the business results showed continued improvement in cost-to-income ratio that recorded 27.6%, while the return-on-assets ratio amounted to 4.4%, and the return-on-equity ratio reached 46.9%. The bank's capital adequacy achieved a strong rate of 19.36%, and the loan portfolio recorded EGP 23.4bn. Moreover, the assets quality continued with an improvement in non-performing loans (NPL) compared to December 2018, registering a ratio of 3.11%. The deposit portfolio reached EGP 41.1bn, while the loan-to-deposit ratio reached 57.1%, and the total shareholders' equity reached EGP 6.6bn. What is the size of the bank's financial contributions to SMEs? We believe the SMEs constitute the backbone of any economy. We give importance to this sector. In fact, Credit Agricole Egypt has developed since years the concept of business hubs that are disseminated across Egypt to provide expertise and advice to SMEs, in addition to the investment and credit services. Regarding our future plans, the bank announced, during the recently held ‘RiseUp Summit', the results of its competition for startups to provide innovative solutions for digitalising the SMEs supply chain, to offer a speedy, efficient, and convenient solution, which will cover both the needs of our customers and their suppliers and would support the growth of their businesses. What about the bank's mortgage finance activities, whether independently or under the CBE's initiative? With regard to the CBE's mortgage finance initiative, the bank is taking steps to roll out the new initiative to our individual clients so as to leverage the attractive interest rate, which on one hand will lead to a rebound in the real estate market, and on the other hand will meet the needs of the largest segment of society for securing housing at appropriate terms. It is also worth noting that the bank has been providing mortgage finance activities for several years. In addition, the bank owns the Egyptian Housing Finance Company that is specialised in this field. What are the bank's objectives in regard to deposit and loan portfolios, and profits? As I mentioned, the bank has a medium-term plan to grow the business and continuously boost our portfolios, in the light of our aim to be the financial partner to our customers and to the economy. This is evidenced in the fact that the ratio of loan-to-deposits in Egyptian pound has exceeded 65% at the end of September 2019, which is an indication that the bank is constantly seeking to finance both projects and individuals. We see that there are great opportunities in this fast-growing market following the courageous and pertinent initiatives taken by the CBE since 2016 and to date. These are giving means to many major infrastructure projects in different sectors with a lot of financing opportunities. In addition, and with this favourable economic growth, the bank will be also accompanying its individual, SMEs, and corporate customers to cover their projects and ambitions. What is the size of the bank's branch network and expansion plan? The bank currently has a network of about 80 branches and 200 ATMs nationwide. It opened in early 2019 its cashless branch at Dandy Mall, to become the first in the series of its innovative branch model "Banki Store". This new model or concept is based on the balance between digital services and banking advice via the relationship managers present across our network. During the course of the year, we also opened several Banki Store branches in El Mesaha Square in Dokki, Tanta, Shebine El Koum, Sheikh Zayed, and Gleem in Alexandria. As for our geographical expansion throughout Egypt, so as to be closer to our clients, wherever they are, we are planning to inaugurate five new branches during 2020 and raise the number of its ATMs by 50% in touristic areas. The new branches will also continue to follow the new innovative model Banki Store, in an initiative from our side to support the dissemination of the digital culture. What are the main areas/locations where the bank intends to expand in the coming period, and do you intend to have a presence in the New Administrative Capital? As you know, the bank is widely spread across the nation. We generally seek to be present in all regions across Egypt, including the New Administrative Capital, but not necessarily by having an administrative office. It is possible to open a branch there to serve both corporate and retail clients. What is the situation of the bank's non-performing loan (NPL) portfolio? The bank's NPL loans decreased to 3.11% of total outstanding loans in the market at the end of September 2019, compared to 3.27% at the end of December 2018, with a coverage ratio of 140% in September 2019. How much is the bank's capital currently, and is there an intention to increase it over the coming period? The bank's paid-up capital currently stands at EGP 1.243bn, and we at Credit Agricole Egypt are prepared to comply with the criteria and requirements of the new Banking Law that will be executed in the coming period. The bank has no problem with complying with this limit in light of the group's keenness to operate in the Egyptian market to leverage the strong investment opportunities that exist in it. What is the bank plan for disseminating financial technology and electronic payments in the Egyptian market? Credit Agricole Egypt has embarked on a digital transformation plan for three years, with the aim to offer our customers the convenience of a multichannel experience. Our transformation has given place to "Banki by Crédit Agricole", a unique fully-fledged platform of state-of-the-art digital services for both corporate and individuals. We are proud that our efforts have been acknowledged and we have received many prestigious awards. This is due to our focus to provide easy tools such as Banki Mobile and Banki Wallet, as well as other services, with the objective to help our customers shift to digital services from one side and to support the dissemination of the digital culture from the other. Not only that, but as explained earlier, we have launched the innovative branch concept "Banki Store" in addition to "Banki Corners" in our branches. Those are animated by digital greeters that introduce the digital services to our customers. As a result of these continuous efforts, Credit Agricole Egypt has recorded that 1 out of 3 customers are now registered in the digital services. We have witnessed an increase by 25% in the total digital transaction banking, while its conventional transactions in branches fell by 10%. The bank also increased the number of its e-wallet clients over 100,000 people. These figures indicate the gradual reliance of our customers on the digital services, which paves the way to the dissemination of the digital culture and the usage of e-services in alignment with the CBE's directions. What is the bank's position from the CBE's initiatives to support the industrial sector? We believe the CBE, via its numerous and continuous initiatives, aims to achieve an economic and social development. The initiative to revitalise the industrial sector will, certainly, support booming the industrial sector in Egypt, push the development process forward, enhancing the competitiveness of the local products to target exports and finally will create new job opportunities. With our ultimate objective to support the local economy and community, Credit Agricole Egypt will be part of this initiative.
