Sean Nero

In­ter­com­mer­cial Bank Ltd (IBL) is on an ex­pan­sion dri­ve and tech­nol­o­gy will be its trump says new­ly ap­point­ed man­ag­ing di­rec­tor and chief ex­ec­u­tive of­fi­cer, Kr­ish­na Bood­hai.The 13-year-old fi­nan­cial in­sti­tu­tion-the small­est of its kind in the lo­cal bank­ing sec­tor-hoped to chal­lenge in­dus­try fore­run­ners, with an at­trac­tive tech-savvy roll out of quick and user-friend­ly so­lu­tions for 2012.

Bood­hai told Busi­ness Guardian that its ef­fort to catch up to com­peti­tors will be strate­gic and this medi­um will be the lynch-pin in the third tier of the bank's planned ex­pan­sion in T&T."State-of-the-art mo­bile bank­ing is what we are go­ing to pitch. We are go­ing to reach the tra­di­tion­al cus­tomers, the new cus­tomers-the new gen­er­a­tion who are high-tech. We are in ex­pan­sion mode. IBL would be in­tro­duc­ing on­line re­tail ser­vices to match and beat that of our ri­vals. We'll be able to pro­vide that high-tech and high-touch In­ter­net and mo­bile bank­ing."

Bood­hai added: "The time to in­vest is now. We have seen the signs of the eco­nom­ic turn­around and we are not pre­pared, as an in­sti­tu­tion, to sit on the fence and wait. We are go­ing to demon­strate that by our own ex­pan­sion plans, and we are al­so go­ing to be part­ner­ing with our cus­tomers be­cause the signs are there and we need to take an ac­tive part in try­ing to de­vel­op more sus­tain­able growth of the econ­o­my."

Fu­elling growth:

While IBL's ex­ec­u­tive team has an ul­ti­mate num­ber of branch­es to be es­tab­lished, in an ef­fort to build and strength­en its cus­tomer base, Bood­hai stressed that the com­pa­ny's ap­proach to growth would be "cost ef­fi­cient." He de­clined to give a time­frame for the start, com­ple­tion and num­ber of these out­lets. Ex­cept for the tech­no­log­i­cal ap­proach, the man­age­ment at IBL has de­ter­mined a growth strat­e­gy that would be "cost ef­fi­cient."

Bood­hai, who suc­ceed­ed Hugh Dun­can, was acute­ly fa­mil­iar with these ini­tia­tives of the bank, hav­ing served as a non-ex­ec­u­tive di­rec­tor on the board of IBL for more than four years.He has a firm grasp of the fi­nan­cial ser­vices sec­tor hav­ing worked with two mul­ti-na­tion­al banks-Sco­tia­bank T&T Ltd, Citibank (T&T) Ltd."There is a time­frame and the lo­gis­tic to get to the branch­es. We in­tend to open, not the big type branch­es, but the small­er branch that would bring ser­vice with­in the reach of the var­i­ous com­mu­ni­ties. That's the mod­el that we are con­tem­plat­ing and we have a dif­fer­en­ti­a­tion strat­e­gy which we will an­nounce in due course."

Lev­el of de­fault:

Of its three branch­es: Port-of-Spain, Mara­bel­la and Ch­agua­nas, IBL's maid­en branch in Ch­agua­nas has been the most suc­cess­ful. When asked about IBL's lev­el of de­fault, Bood­hai said it was with­in the mar­ket norm of three to six per cent. "The mar­ket norm varies ac­cord­ing to the time pe­ri­od. Sev­er­al years ago, the norm was much low­er, in more re­cent time it has gone up, al­most across the board," he said.

Bood­hai cit­ed the ut­ter­ances of fi­nance min­is­ter Win­ston Dook­er­an who de­scribed the fi­nan­cial sec­tor as rel­a­tive­ly sound and de­clared that he and the IBL team were en­cour­aged by vol­ume of liq­uid­i­ty in the sys­tem and the sta­bil­i­ty of the mar­ket.

Three years ago, he said, there was a pe­ri­od of un­cer­tain­ty, but IBL has sta­bilised and its ap­proach to growth would be "mea­sured.""We are an in­sti­tu­tion with over 10,000 cus­tomers and we are seek­ing to grow that cus­tomer base. So we are grow­ing the cus­tomer; grow­ing the as­sets. Over the 13 years, we have built up a bal­ance sheet in ex­cess of $1 bil­lion. We are seek­ing to grow by in­creas­ing our mar­ket share and that's the ex­tent to which I can in­di­cate, at this stage, with­out go­ing in­to spe­cif­ic num­bers."

A re­gion­al pow­er­house:

IBL's ex­pan­sion track was con­sis­tent with that of its par­ent com­pa­ny, Ja­maica Mon­ey Mar­ket Bro­kers (JMMB).The bro­ker­age firm was in the process of ac­quir­ing an­oth­er list­ed com­pa­ny in Ja­maica, said Bood­hai, and was al­so ex­pand­ing by ac­quir­ing banks in the re­gion. "So the JMMB group is in ex­pan­sion mode. Our (IBL's) out­go­ing chief ex­ec­u­tive of­fi­cer CEO (Hugh Dun­can) is not leav­ing. He is go­ing to the group, to pur­sue bank ex­pan­sion.

"Through the JMMB link­ages, we are go­ing to be part of a larg­er bank­ing unit, and there will be syn­er­gies with our unit and the rest of the JMMB group," he said.While IBL's pri­ma­ry busi­ness was loans-in­di­vid­ual and com­mer­cial-the bank had an in­vest­ment book with a mixed port­fo­lio to con­tin­ue the growth process.

No cred­it card?

It's been a lit­tle over a decade since IBL opened its doors for busi­ness, but the com­pa­ny had a suit of deb­it cards avail­able to it clients, as op­posed to cred­it cards. Al­though the bank had link­ages with VISA, Bood­hai said the com­pa­ny did not pur­sue this in­vest­ment track and had no im­me­di­ate plans to get in­to this area of busi­ness. IBL's man­age­ment, he said, would, how­ev­er ex­plore oth­er fa­cil­i­ties that meet with the re­quire­ments of its cus­tomers over time.

De­vel­op­ing SMEs

"We are lend­ing," said Bood­hai. "We have ex­pe­ri­enced growth in this fis­cal year. We are lend­ing to small and medi­um en­ter­pris­es giv­en our cap­i­tal base and the in­di­vid­ual cus­tomers. We have seen ex­pan­sion. It's not like the boom years but, cer­tain­ly, there's a turn around and there's an up­take in lend­ing."

Com­ment­ing on plans by the Fi­nance Min­is­ter to es­tab­lish a Ju­nior Stock Ex­change to be trad­ed on the T&T Stock Ex­change, Bood­hai said it was a good op­por­tu­ni­ty to growth, but lament­ed that fam­i­ly-owned busi­ness­es, which IBL has as clients, re­main un­cer­tain about go­ing pub­lic.

"With­in the group, you would see that JMMB start­ed as a fam­i­ly busi­ness 18 years ago, and very ear­ly, went on the stock mar­ket. JMMB is list­ed on the stock mar­ket, so IBL is in­di­rect­ly part of that list­ing arrange­ment in Ja­maica and is cross-list­ed to T&T."