Andrew Long, CEO of HSBC Bank Oman talks about the bank’s financial performance and major achievements across different channels of operations in 2016
How was HSBC Bank Oman’s financial performance in 2016?
We have reported a 31.0 per cent increase in net profit for the year ended December 31, 2016 to RO16.9mn compared to RO12.9mn for the year ended December 31, 2015. Profit grew due to a combination of higher operating income and lower operating expenses partly offset by higher loan impairment charges.
Our financial performance in 2016 reflects the fundamental strength of our business and our ability to face the challenges posed by the economic environment and the declining oil prices
What were the major milestones during the year? Can you talk about the measures to enhance retailing, ATM and CDM networks of the bank?
Our strong performance in 2016 was recognised by various global awards. We were delighted to be recognised by the Euromoney Award as the Best Cash Management Bank in Oman for the fifth consecutive year, which reflects the strength of our liquidity and cash management solutions that we can offer to our corporate clients in Oman.
A major achievement for HSBC Bank Oman in 2016 was playing a critical role in a strategically important financial advisory mandate by the Omani government, which demonstrates the position HSBC Bank Oman occupies around the table of some of the most important discussions taking place to help develop and diversify the Omani economy.
In 2016, we heightened our focus on delivering an excellent customer experience that sets us apart from our competitors. As a result, we managed to improve our customer recommendation index in our key segment of premier clients to 91 per cent in 2016, up from 89 per cent in 2015.
We continued to focus on improving our overall digital proposition, and we released a new version of our mobile banking App, which gave an enhanced and enriched experience to our customers. As a result of these efforts we saw a sizeable increase in our customers’ digital engagement to 42 per cent in Q4 2016 up from 21 per cent in Q4 2015.
In 2016, we continued our branch refurbishment programme offering a more modern and aesthetically appealing environment, in line with the bank’s focus on delivering a superior and consistent customer experience at all times, through all channels.
How was your retail and corporate lending during the year?
Our customer lending increased by 18.1 per cent from RO1,200.8mn in 2015 to RO1,418.4mn as at 31 December 2016, primarily due to an increase in corporate loans and advances. This compares to an increase over the whole conventional non-Islamic sector of 7.6 per cent.
Our home loans acquisition showed strong growth YoY while our other retail lending sustained momentum despite the challenging macro environment.
 What about the measures taken to support SMEs?
In 2016, we continued to demonstrate our support to SMEs through our ongoing “Growth Series” seminars, where our clients have the chance to listen and interact with leading industry experts to help them grow and expand their business.
In 2016, we hosted the 19th Middle East Economist Roadshow in Muscat, where seasoned HSBC experts discussed the most important global and regional trends shaping the Middle East’s economies. This annual roadshow is a great opportunity for HSBC Bank Oman to connect its customers across the Sultanate to global industry experts to support their future growth ambitions.
What were the major HR initiatives?
We remain fully focused on identifying and developing existing Omani talent and on strengthening talent development through local and overseas programmes. We are proud to have achieved an Omanisation rate of over 94 per cent as of 31st December 2016.
We were proud to be one of the first banks in Oman to offer a “Branch Manager Certification Programme”. This comprehensive programme is in partnership with the College of Banking and Financial Studies and includes a blend of modules on key areas of leadership development, standards and best practices in retail banking.
Throughout 2016 we focused on providing a range of training and development opportunities to enable staff to progress in their careers through a variety of different training activities and alternative media. In addition, all the bank’s employees have regular access to e.learning modules developed by the group. In 2016, we delivered e.learning modules equivalent to 5720 hours.
What are the future plans to enhance operational efficiency?
We will continue to refine our operational processes, implement consistent business models and streamline our IT operations to make it simpler, better and faster for our customers to interact with us. We will continue working on strengthening the collaboration across the bank to speed up the processes of credit cards and loans applications.
What’s your outlook for 2017?
The projected 2017 government budget deficit of RO3bn is expected to be covered through domestic and international borrowings according to the government’s statement. We are confident that we are well positioned to work with the government of Oman to facilitate such borrowing as we did in 2016 where we were the sole lead arranger of the inaugural borrowing by the Ministry of Finance for financing PDO’s production in Oman.
In the coming year, we will build on our existing relationships and introduce new ways to connect customers to local and international opportunities and deliver an increasingly consistent and superior customer experience as we aim to become the leading bank in Oman.