BPR part of AtlasMara was last month recognized as “the best bank in Rwanda” at the annual the Banker Africa 2017 awards for the East African region held in Nairobi, Kenya.
The annual awards are organized by CPI Financial, the publishers of Banker Africa magazine and seek to recognize outstanding performance and excellence in the financial services industry.
Sanjeev Anand, BPR’s managing director, said in an extensive interview with The ServiceMag that the award recognizes the bank’s efforts toward embracing innovation and technology to enhance efficiency and product development.
Anand said the bank, which is part of the Atlas Mara Group, has invested heavily in capacity building, and digitized its systems improve service delivery.
Below are the excerpts;
TSM: Briefly tell our readers on what the award means to BPR and what you did to ensure the bank emerged top.
Sanjeev Anand: Receiving this award by BPR is something very prestigious and pleasing for me and my team.
I have won similar awards in other institutions I have worked with before but this one leaves me very excited because it reflects a fact that we came into this bank less than a year and a half ago. At that time Banque Populaire du Rwanda and BRD Commercial (BRDC) had been merged and both were institutions that had very good potential but were not performing up to it.
So there are many things which I and my team had to do first so that the merged bank performs up to its true potential.
I am so glad that we have taken a number of steps in the last 16 months that have put us in a position to be awarded as the best bank.
We were nowhere to being named the best bank in January 2016.
TSM: What were some of the issues that were hampering the bank from achieving its true potential in the past?
Sanjeev Anand: Some of the things that we had to fix were the following.
First of all, we had to fix our balance sheet and our non-performing loans issues. Secondly, we were not an efficient bank and had a high cost of funding. We also had very high expenses and as a result our cost to income ratio, which measures a bank’s efficiency and should in the region of 60% for a well performing bank, BPR’s was around 110%.
We were also loss-making. In 2015, we had a loss of over Rwf 2 billion. We had very high operational losses and everyday you would hear that a fraud or robbery has been committed. So we needed to convert those losses to profits.
We had service issues and not enough or backward products that were last used in the 20th century.
We had a mobile banking platform but we were not using all its features properly.
Those are some of the issues that we encountered and went around to fix them.
Am glad to report to you that, for last year, we broke even, which in itself was an achievement.
In addition, in the first three months of this year, we expect to have a net profit of Rwf 751 million and Rwf 1.1 billion before tax.
As for the cost to income ratio, as of March this year, we are at 81%, which is a big improvement.
TSM: What did you do to achieve this significant turnaround?
Sanjeev Anand: First of all, we streamlined the processes in the bank. We introduced a lot of technology to carry out the processes that were previously being done manually.
This allowed us to be more efficient and serve our customers better.
The other thing that we did is that we managed to carry out a successful integration of BPR and BRDC. We could have carried on the process until the end of the year but we decided that we merge the banks into one bank as soon as possible. As of 30th June last year, we successfully merged BRDC with BPR. The fact that the market didn’t feel that speaks volumes because usually mergers or amalgamations of that size lead to a lot of adverse effects where customers complain, operational losses take place among so many other things. This all didn’t happen thanks to the able team.
Thirdly, BPR was traditionally a retail bank with a lot of traditional retail products that were not enough in scope and not dealing with all retail segments.
We were not dealing with corporate clients at all and had very few Small and Medium Enterprise (SME) ones.
We needed to expand our retail and serve our existing ones more efficiently. In addition to that, we wanted to bring a new platform for corporate clients and put up a very strong SME unit.
We didn’t have a treasury as such as the one that was there only used to balance the bank’s books. We didn’t have what we call the markets to trade forex and contribute income to the bank. We set up one that is contributing an average of Rwf 70 million per month, which is around Rwf 1 billion per year going straight to the bottom-line which is great stuff.
We have introduced so many digital products that are available on mobile USSD codes, which majority of our customers still use as they don’t have access to internet yet.
And for those who have access to it, we have introduced a state of the art mobile banking application to allow them to seamlessly access banking services on their smartphones.
We have integrated with a number of firms and utilities such as the Rwanda Energy Group (REG), allowing people to pay their bills.
We have also integrated with several schools and universities to allow students to make their payments online and in real time, without hard cash.
We are integrating with other mobile money operators such as MTN Mobile Money, Tigo Cash and Airtel Money, which will allow clients to carry out push pull transactions where they will be able to transfer money from their mobile money accounts to their bank accounts and vice versa, which gives so much flexibility and leads to more financial inclusion. Today, we are a full service bank that caters for SME, retail, corporate and most importantly, banking the unbanked, which is our biggest target.
Our digital platforms are going to help us do it. We shall continue enhancing them.
TSM: What is your main focus this year now that the bank is stable?
Sanjeev Anand: This year, we want to keep our costs under check, build on our revenues and initiate a very active loan recovery stroke.
We still have very high non-performing loans which we need to address. We have a dedicated team that is working on a very sharp recovery process and my goal is that by the end of this year, we should have a non-performing loan ratio within the regulatory guidelines of 5 to 6%.
The other is that as I pointed out to you, our branches were incurring a lot of operational losses. That has now reduced and we now have good measures to run them efficiently. We carry out surprise checks, have operational risk controls for them to work well and every single one of our 194 branches across the country is now online and connected in real time to the main branch so any client can access their account from anywhere at any time.
Lastly, we have invested in a good team. Before, we had good people but I think they were not trained and we also had to change the culture, which was laid back and not customer oriented.
People didn’t understand the products and what it meant to provide quality to customers.
We have a lot on these aspects. I will say that we are perfect now but I am getting feedback from our customers that we are serving them a lot better now than we were earlier.
Therefore, this award is not just that we achieved our profit targets but a combination of many things including the performance of every member of staff at BPR.