Middle East’s best bank for SMEs 2019: ADCB

Awards for Excellence 2019

© 2019 Euromoney

Regional awards

Funding for small and medium-sized businesses remains largely deficient across the Middle East. The region’s economies could grow by a further 1% each year if access to finance improved for SMEs, the International Monetary Fund’s managing director Christine Lagarde said earlier this year.

“In the Arab region, SMEs represent 96% of registered companies,” said Lagarde. “They also employ half the labour force, yet their access to finance is the lowest in the world: lending to SMEs in the region is only 7% of bank lending.”

The United Arab Emirates, in particular, has sought to address this shortfall, with programmes to bolster financial inclusion of smaller enterprises. One of its leading banks, Abu Dhabi Commercial Bank, has been especially active in this area, doing much to support SMEs, even through economic downturns.

Colin Fraser

ADCB launched digital account opening platforms for SMEs and mid-sized corporates last year, providing more simplicity to its clients and reducing turnaround time. ADCB also partnered with Etihad Credit Insurance to provide SME financing. The bank made a concerted effort to increase the number of its merchant clients, leading to 450 new customers in that sector alone. Overall, deposits for wholesale banking – under group head Colin Fraser – increased by 11%, for a net profit up 17%, and the bank says it has grown market share in the SME space by keeping its loan book level while others shrunk theirs. ADCB convinced its SME clients to use its FX platform, with users increasing by 75% in 2018.

ADCB has a team of 200 devoted to SME customers, five dedicated business centres and a 24/7 SME contact centre. Its SME portfolio grew by 7% over the past two years, without affecting its NPL ratio, which dropped from 7% to 4% over the same period.

The bank’s digital proposition more broadly has also benefited its SME clients. These were the first among ADCB’s customers to gain access to the bank’s online financing portal, Agile, in May 2018.