Waleed Al Mogbel, CEO, Al Rajhi Bank • Interview
Al Rajhi has led the sector in digitalization and the adoption of new technologies, a process expedited by the impact of COVID-19.
Al Rajhi has been a leader in digitalization and the adoption of new technologies. Where does digitalization stand in the bank’s overall strategy?
Digitalization has been one of the main pillars of our strategy; we have been extremely ambitious in our digitalization strategy from the beginning. We set up a digital banking group to consolidate the digital agenda, and the first step of the strategy was to make available most of our branch and phone banking services via our mobile app. After this, we digitalized our key products (personal finance, cards, mortgages, and so on) end-to-end. The results have been outstanding, and today we have more than 85% of new customers joining the bank by opening current accounts via either our internet banking website or mobile app. We see a rapid migration toward digital channels of many of the services offered by the bank including cards such as debit, prepaid, and credit, remittances, local transfers, and personal finance. Our mobile banking app has been the key driver for this success. We started a similar journey in our SME and corporate business, where we see digital growth happening at a rapid pace.
You assumed the CEO position just before the pandemic, and steered the organization through a historic crisis and still post a 4% YoY profit. What key changes did you implement?
COVID-19 has been a challenge unlike other economic recessions in terms of the extent and duration of the impacts on our customers and the economy. There was no standard playbook to refer to, meaning our whole team had to adapt quickly. We have, however, kept several things front of mind when making these decisions: protecting our team members and customers; adapting our business operations to ensure we remain accessible to our customers; and supporting the Saudi government in its efforts to navigate the pandemic and ensure a recovery on the other side. To protect our team members, we reduced branch operations during the first wave lockdown, instituted changes to cash handling, and moved our call center operations to remote working. We were able to move quickly thanks to a combination of our recent investments in technology and the tireless work by our team members. For our customers, there was a rapid and enthusiastic switch to remote channels due in large part to the great investment and effort we have made in the last three years to make most service and sales capabilities available over our desktop and award-winning mobile banking app. All our retail banking products are now available for purchase online, which is a first for Saudi banks. These innovations have been greatly welcomed by customers, as seen by the rapid uptake in online account opening and loan applications for Al Rajhi and our new Emkan finance company. Al Rajhi has also supported the numerous government initiatives to support the economy and customers during the pandemic, including fee waivers and support for small business customers.
In what ways did the pandemic shift the way banks operate?
The lockdown to prevent the spread of the pandemic halted economic activity across many sectors, with important repercussions for firms and households. The banking sector was also affected. While banking services can be provided remotely and do not rely on direct customer contact, the linkages of the sector with the real sector as the provider of payment, savings, credit, and risk management services had to operate smoothly without any disruption from COVID-19-induced restrictions. Digital solutions provided a lifeline to households and businesses; for example, the value of POS transactions via mobile increased by about five times in 2020 compared to 2019. At the same time, the banking sector had to support firms and households during this period of lower revenues and incomes, which triggered important policy actions by financial supervisors and governments. In Saudi Arabia, the government stimulated the economy by supporting households and businesses through the banking system; SAR100 billion (equal to 3% of 2019 GDP) in stimulus support was deployed in the banking sector as part of a larger stimulus package.
BIO
Waleed Al Mogbel was appointed as the CEO of Al Rajhi Bank in 2020, after previously serving the organization in various executive positions such as deputy CEO, chief operating officer, and chief financial officer. With a broad experience of 23 years in the financial services industry, he is a professional who is skilled in risk management, banking, accounting, and financial audits. He has a strong academic background with qualifications that include a PhD in auditing from Cardiff University, a master’s degree in accounting and finance from University of Southampton, and a bachelor’s degree in accounting from King Saud University.