MTB looks to become leading digital bank

Mutual Trust Bank (MTB) Limited continues to invest in the digital transformation process to become one of the leading digital banks in the country and serve the tech-savvy younger generation more conveniently.

Since its inception in 1999, MTB has already emerged as a frontline bank with digital setup or network, leveraging its strengths in a vibrant board of directors, good governance and digital transformation.

Now it is expanding its network fast through partnering with FinTech companies, aiming to become a leading digital bank in the country.

"In digital banking, we're doing very well. We're the first bank in the country to introduce virtual debit card, Bangla QR facility and micro-merchant loan," Syed Mahbubur Rahman, managing director and chief executive officer of MTB, told the FE in an exclusive interview ahead of the bank's 24th founding anniversary to be celebrated tomorrow (Tuesday).

The senior banker, having over 34 years of banking experience in the country, said the MTB is now being considered as one of the frontline digital banks in the industry.

"We continue investing in digital transformation of the entire system because we want to stay ahead in this area. In terms of products, process and automation, we want to be of global standard," he added.

Terming the present context of banking scenario a massively challenging one, the MTB top executive said that he never experienced such prolonged stress in the banking sector in his 34 years plus banking experience.

Under such a circumstance when liquidity in terms of both local and foreign currencies is under immense stress, he said, the commercial banks should not go for aggressive lending as liquidity is becoming a major issue.

"We, in the MTB, have adopted a very calculative or cautious approach in terms of lending. Instead of lending, we are giving serious attention to collection and recovery of the loans," Mr Rahman said.

Regarding MTB's current approaches to tackle NPLs (non-performing loans), the MTB managing director said the bank has already planned to clean the legacy of bad loans built up in 2015-2016 by 2026 and the progress is very encouraging.

"We had a loan provision amounting to Tk 2.0 billion in 2021 and doubled to Tk 4.0 billion in 2022," he said.

The experienced banker said the bank wanted to bring down the volume of non-performing assets significantly to reach its target of curtailing the NPL rate below 3.0 per cent from the existing 6.0 per cent by 2026.

Talking about the journey of the commercial bank, which was also listed with the Dhaka and Chattogram bourses in 2003, he said a group of iconic business people had launched the bank, paying serious attention to corporate governance and global best practices.

"In this long journey, yes, there have been some ups and downs, but we could manage to establish ourselves as a bank having good governance in place," Mr Rahman said, adding that the bank has also established itself a reasonable good bank in the market in terms of products, customers' acceptance, satisfaction, and overall banking activities.

When his attention was drawn to the banking activities at a time when there is a looming threat of global recession, he said banks every year set a growth target by chalking out an aggressive plan of actions to reach it.

"We've to be very careful in the coming days. We should concentrate more on consolidation, more on bringing efficiency from the existing balance sheet rather than having an aggressive growth projection because you might be hit by more NPLs and more problems.

"I think, time has come to be more realistic and to reassess thoughts by continuously reviewing the portfolio risk so that we can understand which portfolio might get impacted so we can go for immediate remedy accordingly," Mr Rahman said.

The MTB is providing services through 120 branches and 37 sub-branches across the country. The consolidated deposit and lending now reached Tk 247.04 billion and Tk 248.74 billion respectively. The bank's net profit after tax stood at Tk 2.97 billion in December 2022.

The bank has received numerous accolades, including being recognised as 'One of the top ten sustainable banks of Bangladesh' by Bangladesh Bank (BB) for its 2020 performance, and a letter of appreciation from the BB in 2021 for its outstanding role in disbursing 100 per cent of the Covid-19 CMSME stimulus package.

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