The retail banking industry has been in a strange kind of purgatory since the financial crisis.
Not as badly disgraced as the investment bankers, who brought the house of cards down with their wild bets on incomprehensible financial products, retail bankers still shouldered some of the blame, especially in the UAE, for the credit bubble that eventually burst in 2009.
Robert Crossman arrived in Dubai in 2009 at the height of that great deflation and, as the head of retail banking and wealth management for HSBC, the biggest and oldest foreign bank in the Emirates, has had a bird's-eye view of events since.
"Now, we look at things increasingly from a risk perspective. It's all about striking a balance between growth and risk management, and regulation too. Nobody wants to return to the time when companies, or individuals, were overleveraged," he says.
Mr Crossman is an American who has spent most of his career at HSBC, in positions in the US and UK before moving here.
He believes things are definitely picking up on the UAE macroeconomic scene. "I see a reasonable number of positive things and am cautiously optimistic. Loans are growing again, activity has picked up in the mortgage market, and credit card spending is 18 per cent ahead, after contractions in 2009 and 2010," he says.
But it can never be the same as pre-crisis days. "The banking sector is more disciplined and credit growth will be more restrained. Customers must be screened to ensure they can afford lending products, and we'll be sensible too. For example, maximum loan to value rate for a mortgage is 80 per cent, but our average is 60 per cent."
Mr Crossman applauds the efforts of the authorities to put in place a credit infrastructure for the UAE. "We're positively encouraged by the momentum between the UAE Central Bank and the Ministry of Finance, and very supportive of the initiative to have a universal credit bureau. In our opinion, banks should not have the option of staying out of any scheme," he says.
HSBC is also supportive of other moves towards modernisation of the financial environment in the Emirates, like the introduction of chip and pin.
"We're already there comfortably on debit cards, and would expect to be compliant on credit cards next year.
"On direct debits, we're talking to the Central Bank. They see it as a clear priority, and I believe a higher proportion of transactions will be in electronic form in the future. Ideally, we don't want to depend on cheques."
A couple of years back HSBC courted controversy when a senior executive said there were benefits to the cheque system, and the criminalisation of customers who bounced cheques, because it encouraged debtors to repay.
Mr Crossman chooses his words carefully: " We have to respect and abide by the laws of the jurisdiction, but we try to treat all customers as constructively as possible in cases of delinquency. We make every effort to find a practical solution with a customer, and we're able to do that in almost every case. I haven't dealt with a case of custody in a very long time."
He says the bank will reduce or defer payments, and cut amounts owed, and has also been involved in the Central Bank initiative to provide debt relief for Emirati nationals, who form 7 per cent of HSBC's customer base.
Another recent sign of the recovery in the UAE market was HSBC's acquisition of the Lloyds retail and commercial banking network in the country. It has left Mr Crossman with a problem, but one in which he sees an opportunity.
"The deal added a beautiful branch to our network, the old Lloyds building on Al Wasl Road in Dubai. That means we have nine branches in the UAE, one more than the regulations allow for foreign banks. We're in talks with the Central Bank about this, and hope to be able to keep the nine branches. Ideally, we'd like more branches. We feel under-represented in Abu Dhabi," he says.
There have been other changes at HSBC in the region. The bank went through a series of layoffs in 2011, but that downsizing appears to be over. "We'll have more employees in 2013 than this year," Mr Crossman says.
And the bank has pulled out of the Amanah Islamic banking business in several countries, including the UAE. "Here we face very strong competition in the Islamic banking space. There was just not enough scale for HSBC."
No discussion of HSBC's regional business could avoid mention of the great controversy that recently overtook the bank, with a record US$1.9 billion (Dh6.98bn) fine imposed by US regulators for money laundering and sanctions busting offences between 2001 and 2010. Much of the illegal trade involved Iran, and went through the bank's UAE business.
"We've been open and honest in acknowledging our mistakes. There are new compliance measures in place here in the UAE and globally that mean it will not happen again."
fkane@thenational.ae
COMPANY%20PROFILE
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Results
United States beat UAE by three wickets
United States beat Scotland by 35 runs
UAE v Scotland – no result
United States beat UAE by 98 runs
Scotland beat United States by four wickets
Fixtures
Sunday, 10am, ICC Academy, Dubai - UAE v Scotland
Admission is free
COMPANY PROFILE
Name: Lamsa
Founder: Badr Ward
Launched: 2014
Employees: 60
Based: Abu Dhabi
Sector: EdTech
Funding to date: $15 million
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Company%20profile
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COMPANY PROFILE
Name: HyperSpace
Started: 2020
Founders: Alexander Heller, Rama Allen and Desi Gonzalez
Based: Dubai, UAE
Sector: Entertainment
Number of staff: 210
Investment raised: $75 million from investors including Galaxy Interactive, Riyadh Season, Sega Ventures and Apis Venture Partners
The%20specs
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The specs
Engine: 2.7-litre 4-cylinder Turbomax
Power: 310hp
Torque: 583Nm
Transmission: 8-speed automatic
Price: From Dh192,500
On sale: Now
UAE%20FIXTURES
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Joker: Folie a Deux
Starring: Joaquin Phoenix, Lady Gaga, Brendan Gleeson
Director: Todd Phillips
Rating: 2/5
Boston%20Strangler
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Sustainable Development Goals
1. End poverty in all its forms everywhere
2. End hunger, achieve food security and improved nutrition and promote sustainable agriculture
3. Ensure healthy lives and promote well-being for all at all ages
4. Ensure inclusive and equitable quality education and promote lifelong learning opportunities for all
5. Achieve gender equality and empower all women and girls
6. Ensure availability and sustainable management of water and sanitation for all
7. Ensure access to affordable, reliable, sustainable and modern energy for all
8. Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all
9. Build resilient infrastructure, promote inclusive and sustainable industrialisation and foster innovation
10. Reduce inequality within and among countries
11. Make cities and human settlements inclusive, safe, resilient and sustainable
12. Ensure sustainable consumption and production patterns
13. Take urgent action to combat climate change and its effects
14. Conserve and sustainably use the oceans, seas and marine resources for sustainable development
15. Protect, restore and promote sustainable use of terrestrial ecosystems, sustainably manage forests, combat desertification, and halt and reverse land degradation and halt biodiversity loss
16. Promote peaceful and inclusive societies for sustainable development, provide access to justice for all and build effective, accountable and inclusive institutions at all levels
17. Strengthen the means of implementation and revitalise the global partnership for sustainable development
Moon Music
Artist: Coldplay
Label: Parlophone/Atlantic
Number of tracks: 10
Rating: 3/5
Uefa Nations League: How it works
The Uefa Nations League, introduced last year, has reached its final stage, to be played over five days in northern Portugal. The format of its closing tournament is compact, spread over two semi-finals, with the first, Portugal versus Switzerland in Porto on Wednesday evening, and the second, England against the Netherlands, in Guimaraes, on Thursday.
The winners of each semi will then meet at Porto’s Dragao stadium on Sunday, with the losing semi-finalists contesting a third-place play-off in Guimaraes earlier that day.
Qualifying for the final stage was via League A of the inaugural Nations League, in which the top 12 European countries according to Uefa's co-efficient seeding system were divided into four groups, the teams playing each other twice between September and November. Portugal, who finished above Italy and Poland, successfully bid to host the finals.
The bio
Favourite book: Peter Rabbit. I used to read it to my three children and still read it myself. If I am feeling down it brings back good memories.
Best thing about your job: Getting to help people. My mum always told me never to pass up an opportunity to do a good deed.
Best part of life in the UAE: The weather. The constant sunshine is amazing and there is always something to do, you have so many options when it comes to how to spend your day.
Favourite holiday destination: Malaysia. I went there for my honeymoon and ended up volunteering to teach local children for a few hours each day. It is such a special place and I plan to retire there one day.
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