Adib spreads wings as competition intensifies

Abu Dhabi Islamic Bank's expansionary drive in Dubai has attracted Arab expatriates and non-Muslim westerners, according to its new retail banking chief.

Of the current monthly inflow of 8,000 to 9,000 new Abu Dhabi Islamic Bank customers, Emiratis comprised about 60 per cent while expatriates made up 40 per cent. Christopher Pike / The National

Abu Dhabi Islamic Bank (Adib) is branching out from its base in the capital as competition in national banking sector intensifies.

The lender, established in 1997 based on Sharia principles, grew its customer base by 13 per cent last year to 550,000 customers.

Its expansionary drive in Dubai – offering perks such as air miles on covered cards (the Islamic equivalent of credit cards), and competitive fees – has attracted Arab expatriates and non-Muslim westerners, according to Philip King, Adib’s new retail banking chief.

He said its market research showed that “when we were not saying who we were”, that appealed greatly to non-Muslim expatriates.

“Our tagline of ‘banking as it should be’ came from a non-Muslim expat,” Mr King said.

“There’s no fine print. You know what you get. You’re very clear, you’re very transparent. It’s very clear and it’s very effective.”

He said of the current monthly inflow of 8,000 to 9,000 new customers, Emiratis comprised about 60 per cent while expatriates made up 40 per cent. Previously, Emiratis comprised 80 per cent of the bank’s clientele.

Mr King attributed that to the lender’s push into Dubai, which has resulted in a near tripling of the number of its bank branches in the emirate to 17 since 2009.

“I would say there’s been a shift in the last 18 months in the customer base,” Mr King said. “We’re not moving away from the UAE base. The appeal of our brand is extending into new markets.”

Nevertheless, marketing Islamic banking to expatriates unfamiliar with Sharia tenets is difficult.

A Citibank veteran, Mr King is betting that the declining fortunes of western banks since the global financial crisis will make the principles of Islamic banking more appealing to non-Muslims.

Like many banks, Adib is focusing on attracting the richest retail clients. To that end, it is adding four more “priority gold” banking centres that offer the complimentary use of iPads to customers in ornate waiting rooms. Two of the new centres will be in Dubai and two in Al Ain.

Mr King said the bank would also increase its direct sales force in the coming year.

Adib's local retail banking rivals include Emirates NDB and Abu Dhabi Commercial Bank.

Competition in the industry is likely to increase in the years ahead as lenders – including National Bank of Abu Dhabi, the country's biggest by assets – plan to bolster their retail presence.