Riyadh, Asharq Al-Awsat—In an exclusive interview with Asharq Al-Awsat, the CEO of the Saudi Investment Bank (SAIB), Musaed Bin Mohammed Al-Mineefi, said that the Saudi banking sector has entered a new phase, adding that it is among the strongest national banking sectors in the world.
Al-Mineefi joined SAIB in 1992 and was appointed general manager in January 2010. He previously held the role of group general manager for finance, operations and administration. Prior to joining SAIB, Mineefi was the finance director of Al Salam Aircraft Company, Riyadh. He holds a bachelor’s degree in accounting from King Saud University in Riyadh.
Asharq Al-Awsat: What is your view of the Saudi banking sector today?
Musaed Bin Mohammed Al-Mineefi: I think that the Saudi banking sector is passing through a very new phase. There is new growth that is consistent with overall economic growth, while the Saudi banking sector enjoys an excellent financial record that is considered among the best in the world. Additionally, we have overcome the effects of the instability that hit world financial markets in 2008.
Q: We have recently seen a rush towards personal loans from Saudi banks. What is the reason for this?
It’s not so much a rush as it is an in-demand product fulfilling the needs of clients. One of the main triggers for this has been the Kingdom’s recent economic growth, which has led to a higher employment rate among young people in general. These young people need funding to meet their needs, such as marriage, building a home, buying a car, etc. Also, change in consumer patterns has played an important role in this increased demand as well.
Q: Building on the previous question, why hasn’t there been a similar move towards lending focused on real estate and homes?
This may have been true in the past, due to the lack of regulations in defining the relationship between the lending agency and the client regarding home loans. However, we hope to see new growth in home lending as a result of passing and enforcing many new mortgage regulations.
Q: A number of Saudi banks are moving away from personalized customer care and towards automated services. What is SAIB’s policy towards this?
Our employees are of the utmost importance and represent a key pillar of concern. We are continually striving to provide an appropriate work environment of professionalism and transparency to improve the productivity and loyalty of our employees. Furthermore, we are keen to offer appropriate financial incentives to our employees based on their work efforts and salary. We also have programs that recognize and reward excellence. We also hold an annual anonymous poll to measure employee happiness with the work environment. SAIB has also introduced several programs for employee bonuses tied to the length of their service, which includes stock options and financial bonuses. We also offer training programs to develop employee skills.
Q: Why doesn’t SAIB have more branches?
Over the past few years, the bank has put into motion an ambitious plan to increase the number of branches from 14 to 48, in addition to 11 departments for women, in every region and major city in the country. This plan has been enacted and we are reviewing the results of the expansion that has taken place so far. I would like to note that increasing preference for electronic services among clients has led us to develop and keep pace with technological developments to better serve our clients. This is something that may limit the need to establish new branches.
Q: What is SAIB’s position on corporate social responsibility?
SAIB has made social participation one of its priorities through the creation of various programs to support a number of sectors in society. This support has grown from the bank’s belief in the importance of cooperation between individuals and institutions in society. We are always updating and developing programs within the bank to achieve our goals of participating in the education sector, training students how to adapt to the job market, and supporting and addressing society’s health concerns. The bank has also recently released its second annual report on sustainable development. We are the first bank to do so.
The bank has worked with a number of volunteer organizations, charitable organizations and governmental institutions, such as the Down’s Syndrome Society, Harakia [for adults with motor disabilities], Watan, Kellena [for people with renal failure], the Center for Disability Research, and others. We also support humanitarian causes. We encourage employees to visit sick children in hospitals on Ramadan and other holidays. We encourage social visits with the elderly in Riyadh and the celebration of international family day. The bank also participates in a number of sponsorship programs and events. SAIB has a summer training program focused on social service as well as a children’s bank program in which we host a number of school children throughout our various branches. Finally, SAIB was the primary sponsor of an exhibition match between the Saudi national soccer team and Argentina’s national team that included some of the most famous stars in the world.
Q: In your expert opinion, is the number of banks in the local market sufficient to meet the needs of the market?
In my opinion, Saudi Arabia’s banking sector experience has been very successful. This has led to the establishment of large banks with strong financial records offering great services, on par with the latest services offered by international banks. I think that increasing licenses could lead to the emergence of weak banks, which could expose shareholders, depositors, and the national economy to considerable risks in the event of economic unrest. However, we have seen some widening in licensing for some international and regional banks hoping to operate in the country, which will enrich the expertise and services offered in the local banking sector.
Q: What is your opinion of the new regulations being applied by the Saudi Arabian Monetary Agency (SAMA) on Saudi banks?
The policy and regulations that SAMA is following mark an extension of Saudi Arabia’s commitment to a free economy and taking into account the effects of that on society. I believe that the controls and regulations that the organization has issued are responses to previous and expected developments in the local and international financial market which ensure the soundness of the banking sector, its growth and its application of the most modern technologies and practices.
Q: What new services does the bank offer its clients?
SAIB has outfitted its branches with Customer Feedback Units, which measure customer satisfaction regarding the quality of services. Immediately after receiving a service, the customer indicates the quality of that service (Excellent, Good, Acceptable, Poor, Unacceptable) by pressing the device in front of them.
Implementing this system in the bank is an extension of SAIB’s strategy to be the first and best choice in all business sectors. This device is connected with to a system that is centrally monitored by the customer service team. Information is immediately gathered and used to prepare statistical reports revealing the level of customer satisfaction with different services. These reports are analyzed and studied to clarify the areas in need of development to raise the level of services.
SAIB is the first bank in Saudi Arabia to employ this service which reflects the bank’s commitment to customer service. Also this will help raise the quality of services offered in all of the bank’s branches.
SAIB has recently implemented a system that digitally reads and verifies national identity cards in our branches all over the country. The goal is to help citizens complete all of their banking transactions in our branches safely and securely. Cards will be read automatically during any banking transactions which will help verify the identity of clients and avoid any potential mistakes that could arise through manually entering information. In the future all electronic services offered by the bank could benefit from this service.