Pent-up demand, resurgent economy to drive loan growth in UAE: RAK Bank CEO


Dubai: The rapid recovery of the UAE economy, supported by rising consumer spending, is expected to drive loan growth and bank profitability this year, Raheel Ahmed, CEO of RAK Bank, told Gulf News in an interview.

“With pent-up demand over the past two years, we are seeing growth in consumer lending. Likewise, with the positive growth of the economy, we are also seeing a renewed demand for financing from small and medium-sized enterprises (SMEs) and businesses. However, competition remains intense and margins will continue to remain under pressure,” Ahmed said.

He expects the margin squeeze to gradually ease with higher lending rates and an appropriate business mix.

“During the pandemic, low-margin businesses such as corporate lending grew at a faster rate while higher-margin products that were more impacted by the pandemic grew at a slower rate. Going forward, we expect this trend to normalize as we seek growth across all of our key businesses,” he said.


Over the past few years, RAK Bank has focused on diversifying its loan portfolio, while focusing on products that generate a healthy mix of interest and non-interest stream income.

Over the past five years, the bank has built a strong portfolio of corporate assets while maintaining growth in the SME and retail portfolios.

“We will continue to focus on diversifying our assets while maintaining a healthy mix of retail, SME and corporate bank loan portfolios,” Ahmed said.

The bank has made significant gains in creating strong non-interest income streams over the past few years. The increase in its non-interest income over the past year is mainly attributable to the increase in net fee and commission income. The bank is actively looking to grow its base fee revenue, whether through new customer segments or new revenue streams.

RAK Bank has seen a significant improvement in its loan loss provisions for 2021 with the lowest level seen in the past six years, indicating a strong rebound in the economy and the success of the bank’s business diversification strategy. Bank.

“We truly believe the worst is behind us, and with the economy slowly but surely recovering, we see no material adversity in our loss provisions,” Ahmed said.

Digital is the future

The lender wants its digitization strategy to be geared more towards helping customers in decision-making.

“I want RAKBank to further accelerate digitalization by becoming more and more integrated into the customer’s decision-making process. We want to think well beyond traditional banking services and help our customers plan, manage and grow their money in the way that best suits them,” Ahmed said.

Going forward, the bank’s digitalization strategy will focus on harnessing the power of data and advanced analytics to enable its customers to make the right financial decisions.

“This is where RAK Bank will invest to win and stand out from its peers. By doing so, we will be able to create relevant and hyper-personalized customer offers and experiences,” he said.

Although digitalization comes with significant costs, he believes it is the way forward to harness the benefits of faster business growth and economies of scale.

A CEO for the next phase of growth

Image Credit: Supplied

Raheel Ahmed was appointed CEO of RAK Bank in January 2022 to develop and execute the bank’s strategy for its next phase of growth and increase profitability while achieving excellence in customer engagement by leveraging data and insight. technology.

A seasoned banker and transformation leader, he has over 30 years of banking experience in Asia, the Middle East, Africa and Europe. He thrives in developing transformational strategies with a focus on creating a high performance, customer-centric culture.

Raheel joins RAK Bank from Barclays UK where he was a member of the Executive Committee and Head of Products and Analytics, responsible for personal banking products strategy and business performance.


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