Midland Bank Limited (MDB) has planned to raise Tk 700 million through Initial Public Offering (IPO) subscription by the final quarter of this calendar year to expand its capital base, the bank's top executive has said.
"We're working to issue the IPO within the last quarter of this year," Md. Ahsan-uz Zaman, managing director (MD) and chief executive officer (CEO) of the bank, told the Financial Express (FE) in an exclusive interview recently ahead of the bank's 9th anniversary.
MDB started its journey on June 20, 2013 with a corporate slogan 'bank for inclusive growth.'
The fourth generation private commercial bank (PCB) has already submitted an application to the Bangladesh Securities and Exchange Commission (BSEC) seeking approval of the IPO, according to the CEO.
"We've already obtained approval for issuing the IPO from the central bank," Mr Zaman said while replying to a query.
MDB has offered shares worth Tk 50 million to its employees for the first time in Bangladesh, the CEO said, adding that a lock-in period for the employee's shares will be imposed for two years.
He also said MDB has also planned to introduce 'double benefit plus' deposit scheme shortly to offer flexibility to their depositors
The senior banker also spoke on different issues like rising trend of classified loans, corporate governance and deposit situation in the country's banking system.
Regarding the country's foreign exchange (forex) market situation, the CEO urges the policymakers to take effective measures to minimise the gap between banking channel and open market, known as kerb market exchange rates for maintaining the existing trend in remittance.
"Net profit of banks may hamper by the end of this calendar year if the upward trend of inflation continues," Mr Zaman, a 40-year experienced banker, said while replying to another query.
Prior to joining MDB, he was working for Mutual Trust Bank (MTB) as additional managing director.
Mr Zaman initially joined MTB as deputy managing director in July 2009 and was instrumental in developing existing and new client relationships, new business initiatives, assisting in recruiting key officers, providing strategic direction and managing risk by chairing various committees of the bank.
Prior to MTB, he worked for Bank of America in New York, at its global wealth and investment management division with responsibility for business across a wide assigned territory.
He has diversified banking experience, having worked at home and abroad, serving JP Morgan Chase Bank, Morgan Stanley, BNP Paribas and ANZ Grindlays Bank where he joined as a management trainee in Dhaka in 1982.
He completed his MBA from the Institute of Business Administration of University of Dhaka and is an accredited mediator.
About the deposit situation, the senior banker said availability of deposit is likely to shrink in the near future as the demand for credit is growing during the post-Covid pandemic situation.
"Yields on the government securities have maintained an upward trend recently as higher bank borrowing requirements of the government," he noted.
Call money rate has also increased slightly indicating squeezes the flow of liquidity in the banking system, according to the CEO.
MDB has committed to bring more un-banked people in the banking network by extending technology-based services to the doorstep of each person, according to the CEO.
As part of the moves, the PCB has already developed a digital platform- midland online - aiming to offer better services to their clients.
Through midland online, customers can view their account transactions in real time, transfer funds within MDB and also to other banks externally, pay utility bills and open digital term deposits, and monthly savings schemes all instantly without visiting a branch.
"We've already introduced e-Saver account -- MDB e-Saver Account -in line with the Bangladesh Bank (BB)'s e-KYC guideline to offer hassle free services to our clients sitting from home," Mr Zaman said while describing different digital initiatives of the bank.
Interested clients will be able to open such accounts using their smart phones through providing photos and national identity cards (NIDs), he added.
Besides, MDB has already signed partnership agreements with three leading mobile financial service (MFS) providers-bkask, Nagad and Rocket-to facilitate its clients for making faster payments over the phone.
"We're also working continuously to ensure faster and secure services to our valued customers across the country using the latest financial technology (FinTech) system," the CEO explained.
FinTech is the new technology and innovation that aims to compete with traditional financial methods in the delivery of financial services using smartphones or internet.
The PCB's latest moves came against the backdrop of around 60 per cent of the total population of Bangladesh is still out of the banking system despite strengthening financial inclusion initiatives across the country.
MDB has also planned to strengthen financing in the cottage, micro, small and medium enterprises (CMSMEs) and retail banking gradually along with corporate entities aiming to bring more un-banked people in the banking network.
Currently, MDB is running its businesses with 35 branches, 15 sub-branches along with 100 agent banking centers across the country.
The PCB has 100 foreign correspondents across the world and offers both conventional and islami banking services under its Islamic banking window 'Midland Bank Saalam'.
It's long term credit rating, issued by Credit Rating Agency of Bangladesh (CRAB) was upgraded to A1 recently and its short term rating is ST 2.