Data critical in corporate banking transformation
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Data critical in corporate banking transformation

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Digital transformation is beginning to have a profound impact on the advice, services and products that banks such as Ahli United Bank provide to their corporate banking customers.

While the banking industry has generally been slow to react to the rapidly changing digital needs of retail customers, banks have tended to move more in-step with their corporate banking clients, largely because they are on similar digital transformation journeys.

Those journeys have started at different points, however. Banks have, for instance, been some of the most sophisticated users and biggest investors in technology for decades, putting them some way ahead of some companies in other industries.

One of the most technologically advanced areas within banks has been their corporate banking business and treasury operations. Annual investment in these areas has been rising in recent years and continues to grow to keep pace with technological advancement and client demands.

Indeed, for Ahli United Bank (AUB), it is substantially investing in these areas not only to quicken and modernize internal processes but also to seize the opportunities – on growing customer demand – to increase digitization across its corporate client offerings, products and services.

AUB’s corporate banking services are diverse and include corporate, trade and property finance, acquisition and structured finance, correspondent banking, and Shari’a compliant banking products. Its treasury business covers money market and foreign exchange services, hedging and trading solutions, structured products and Shari’a compliant treasury products.

In both businesses, Samih Abutaleb, group head of digital transformation at AUB in Bahrain, says that the nature of client demand is shifting rapidly, requiring an equally swift response from the bank.

Innovating at speed is, however, never easy, which is why banks have been increasing their investments in, and partnerships with, innovative start-ups and technology platforms.

For Abutaleb, he says buying or investing in a ready-built technology solution is often the most efficient approach. He adds, though, that the bank will often also build the solution, especially if it uses relies on highly sensitive proprietary data or technology infrastructure.

For most banks, a hybrid approach can be the most effective, better enabling them to address the multiple needs of their clients.

“This includes rising demand for seamless, customized product and services, combined with user-friendly interfaces and other value-added services, such as more sophisticated risk management solutions, to better manage their business, operational and technology risks,” says Abutaleb.

Demonstrating value through service

AUB has been developing such solutions, while also moving towards being a more sophisticated, data-led adviser to its corporate clients, supported by the provision of technology platforms and digital applications that securely enable them to transact and analyze their own data.

This is the case in the treasury business, which, for corporate clients, has gone through quite a rapid digital transformation in recent years, says Abutaleb.

“So much of the finance function in companies today is automated, where technologies such as artificial intelligence and machine learning are used, for example, to forecast cashflows and expected sales revenue,” he says. “In addition to that, financial data and information is commoditized, so everybody has the same market and pricing visibility.”

The challenge for banks, therefore, is to demonstrate their value, and for Abutaleb that comes from high quality customer service and empowering their clients with greater technological capability.

What will differentiate one bank from another is the customer experience and the access to data a bank can provide.
Samih Abutaleb, group head of digital transformation, Ahli United Bank
Samih Abutaleb, head of digital transformation, Ahli United Bank.jpg

“For our wholesale clients, part of the focus is on providing them with the right products, services and seamless execution,” says Abutaleb. “As an example, an FX trade with automatic hedging can be executed with only a couple of clicks on our trading platform. This is empowering our customers to do more, supported by the greater platform and execution capability we can now offer them.”

The same is true in AUB’s corporate banking business, where the bank has been innovating with some sophisticated technologies. For instance, AUB was the first in the region to bring social media banking services to the market using WhatsApp for Business, a programme supported by AI. The bank also introduced the market’s first corporate deposit card, enabling a client’s representative to deposit cash directly into the corporate’s account on a 24/7 basis without visiting the branch.

AUB also continues to innovate with its market-leading digital cash management solution called B2B. The desktop and mobile solution, which can be customized to suit the different accounting systems of the bank’s corporate clients, enables efficient management of payments online.

What the future of corporate banking and treasury services will look like is difficult to judge. The advice, service and products will undoubtedly be more technologically advanced and sophisticated.

Yet, Abutaleb also believes that the one-size-fits-all approach will completely disappear and that, as a result, future banking services will be much more customized, based on the customer data.

He adds: “Banking is becoming more and more like a utility. What will differentiate one bank from another is the customer experience and the access to data a bank can provide. What clients can do with their own data will help them define their future. We want to be able help them do that.”

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