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Dhaka Tribune

How Premier Bank is pivoting to digital banking

M Reazul Karim, MD and CEO of the bank, shares the secret of his bank's 4-year strategy and more with Dhaka Tribune's Meraj Mavis

Update : 08 Nov 2023, 10:46 AM

Premier Bank PLC turned 25 this October. Tell us about your journey and plans for the future.

A group of visionary entrepreneurs under the aegis and dynamic leadership of Dr HBM Iqbal set out in 1999 to contribute to the economy of Bangladesh in a sustainable way.

Premier Bank PLC began operations on June 10 of the same year, with the aim to ‘put our values together makes us better’ with the cherished goal of becoming the number one bank for customer service, trust and advocacy in all our chosen fronts with the deeply ingrained value of ‘Service First.’

Amid a competitive landscape, Premier Bank PLC emerged as a bank of the people's choice over the last two decades. The list of milestones and achievements of the bank are many.

Introduction of real time online banking, commencement of Islamic banking business, commencement of brokerage operation, incorporation of Premiere Securities, launching of Premier Agent Banking serve, launching of Smart Banking App ‘PMONEY’, launching customer care centre, achieving Moody’s Investors Service B1 rating, are just to name a few.     

With passionate support of spirited employees, able management team and trust of all the stakeholders, Premier Bank PLC is on a road to write a myriad of success stories in the days ahead.

Tell us how you plan to make Premier Bank an industry leader in a crowded market?

In our journey to gain a strong foothold in this volatile and ever changing financial terrain, we faced several challenges.

Staying resilient in the competitive industry of banking turned to be a major challenge in one point of time when a number of third and fourth generation banks came into foray in the last couple of years.

However, a distinct reflection of our spirit of resilience and determination backed by the strength of our diversified business model as well as our passion to perform opened up the way to navigate all the challenges in rain and shine.                  

We set a target of four years at the end of 2022.

We decided that the way our bank has progressed in the last five to six years in terms of creating infrastructure, including manpower, technology, and products, we have to take it to a more improved level.

Maybe we were running in second or third throttle, but now we are in an attempt to take it to fourth or fifth throttle.

Our plan is to double our entire business and portfolio in the next four years. We have a target to increase our market share significantly.

We are also planning a more wholesome business drive combining all our business avenues.

Besides, in line with the directives of the regulators, we are targeting to cover the more unbanked population of the country by spreading our network in suitable areas. 

We will also try to take our loan portfolio to Tk60,000-80,000 crore by 2026.

Then we will take up another four-year plan.

You have held several positions inside this bank for the past 20 years, and as of April 2018, you are the MD and CEO. How much have Premier Bank's smart banking and digital banking capabilities developed over this period?

Riding on the reputation it has earned over the decades, Premier Bank PLC is investing to build up a robust digital infrastructure with a view to providing all financial services at the fingertips of customers and their doorsteps.

In doing so, Premier Bank wants to be a lifelong partner of every customer.

At Premier Bank, we are embracing modern technologies so that we can satisfy all the digital needs of the customers.

We also want to create a perception among the people that the capacity and integrity of our employees is unparalleled.

We have by now developed a Mobile App ‘PMONEY’ to provide banking service digitally.

Alongside an increased focus on boosting the digital infrastructure, Premier Bank has expanded its footprints through the setting up of sub-branches, particularly in suburban areas.

Over the past few years, Premier Bank's default loan rate has been one of the lowest in the country. How did you achieve this?

Our bank's Recovery Division puts its all-out effort in order to make considerable contributions to the asset-based Bank’s portfolio as it tries to reduce the NPL and at the same time tries to keep the loan portfolio of the bank healthy.

Our recovery team strengthens its special recovery drive through visiting all over the country particularly outside the Dhaka branches and its defaulted clients with the help of concerned branch officials.

The bank has strengthened its recovery drive by involving officials of the concerned branches maintaining regulatory norms, rules, circulars issued by Bangladesh Bank from time to time.

As a result, Tk80 crore has been recovered in 2022.

We are ensuring adequate collaterals against loans, carrying out feasibility studies of the projects before sanctioning loans, proper documentation and strong monitoring in place and hoping for a turn-around in the coming days with a lower NPL matrix.

How does Premier Bank PLC’s loan portfolio differ from that of other banks and what steps have you taken regarding financial inclusion?

Premier Bank maintains a well-diversified loan portfolio by extending project finance, SME loans, Agricultural credit, House Building loan to the deserving clients.

A wide range of business, industry service and trade sectors constitute the Bank’s advanced portfolio.

We have a significant number of readymade garment (RMG) clients both from domestic and off-shore circuits which makes our loan portfolio different and diversified than our peers.

The bank has already secured a strong position in the foreign exchange business: it is the largest lender in terms of earnings in the segment. 

We have opened sub branches in the remotest parts of the country where people are yet to be brought under a formal financial umbrella.

This will help expedite the financial inclusion agenda of the bank and country as well.

Interference by the board of directors in the management of banks is an obstacle to good governance. How much freedom do you get in the management of the bank?

Premier Bank PLC believes in exercising good governance in this second-generation private commercial bank and we are fully committed to adopting the best corporate governance practices.

As a values-based organization, corporate governance, compliance, ethics and transparency are the cornerstones of our business ethos.

The objectives of corporate governance are to enhance stakeholders' value by pursuing ethical and sustainable business practices while maintaining a high standard of disclosure, transparency and accountability.

I always take pride in the independence and professionalism of the bank as its board of directors set policy, guidelines and monitor bank management but do not interfere in day to day execution.

At Premier Bank, a team of more than 2,563 work for a common goal - to be the number one bank in the country. The power of unity gives us the strength to navigate any odds in style.

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