(Bloomberg) -- Dubai-based Mashreqbank PSC is pushing ahead with plans to increase its digital reach in some of the region’s most populous countries, with a major focus on Saudi Arabia.
The lender has applied for banking licenses in Saudi Arabia, Oman and Pakistan, and is seeking to expand in Egypt, Chief Executive Officer Ahmed Abdelaal said in an interview.
“We are pretty much focused on Saudi. We have applied for a banking license and we are going through the process right now,” he said. “We just got a positive nod also from the Central Bank of Oman to establish a business over there.”
Discussions are advanced, Abdelaal said, declining to give a timeline for when he expects to receive approval. In those countries, Mashreq will provide services “purely on a digital” basis, he said. In Egypt, the lender plans to scale up its online platforms Neo and NeoBiz by second half of the year, and plans to launch a digital bank in Pakistan in the next 12 to 18 months.
Like other lenders in the region, Mashreq is focusing on its digital business to attract a younger client base. In some countries such as Egypt, many customers are only able to access banking services via online platforms.
In the United Arab Emirates, Mashreq now operates just seven branches, compared with 37 a few years ago. It has been increasing its cooperation with Noon, the Middle East’s answer to Amazon.com Inc. and recently launched Neo NXT, which mainly targets teenagers.
Abdelaal said the bank has also been boosting its wealth management business “significantly” in recent years, investing in staff, hiring talent, and expanding its products after Dubai’s handling of the pandemic attracted an influx of wealthy investors.
Mashreq has also benefited from the city’s booming property market, while higher oil prices have buoyed regional economies and markets, prompting sovereign wealth funds to invest the crude windfall at home and abroad.
“We have done fairly well, like most banks here,” Abdelaal said. “But for us, we’re focused on our digital transformation strategy. We have no intention of going brick and mortar in any of our growth markets.”
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