Interview

After Tk 1,000cr profit, City Bank now eyes digital-first future

Chairman Hossain Khaled says in an interview with The Daily Star
Hossain Khaled City Bank interview

City Bank reached a profit milestone and posted a strong deposit growth last year, thanks to its careful fund management, solid asset quality and strict cost control, according to the bank's Chairman Hossain Khaled.

The commercial lender crossed the Tk 1,000 crore profit mark in 2024, for which Khaled credited digital innovation through platforms such as Citytouch and financial inclusion initiatives that extend from rural agent banking to specialised SME financing.

In an interview with The Daily Star, he said the bank is creating a truly digital-first ecosystem where millions can access financial services without visiting a branch.

In 2024, the bank recorded a 31 percent rise in deposits. Khaled said this reflected the confidence of customers, shareholders and partners.

Building on its reputation as a technology pioneer, the bank is now looking ahead to the next decade.

The bank chairman described a plan to develop a highly personalised banking platform able to anticipate customer needs in real time.

"Our goal is to merge innovation with trust and operational excellence to redefine the future of banking in Bangladesh," he said.

According to the chairman, City Bank is strengthening its resilience with tighter lending discipline, stronger credit governance and advanced tools such as automated Expected Credit Loss models, AI-powered credit assessments and regular stress tests.

Khaled said Bangladesh Bank's preliminary approval for City Bank to set up a credit bureau was a key step towards greater market transparency.

As customer expectations change in the digital era, City Bank is turning its platforms into lifestyle-enabling ecosystems. Khaled said the bank is investing in technology-driven personalisation and digital loyalty programmes while remaining anchored in its core values of security, reliability and real-time support.

"Our goal is to make banking both effortless and empowering, seamlessly woven into the customer's everyday experience," he said.

The upcoming launch of City Credit Bureau PLC is central to this strategy. The bureau will use advanced analytics and alternative data to strengthen credit assessments and reduce default risks, improving the efficiency of retail and SME lending.

Khaled said the long-term vision is to capture a significant share of the market and position City Bank as a leader in the country's next-generation credit information ecosystem.

Discussing challenges facing the sector, Khaled said the industry is at a critical juncture, with high levels of non-performing loans (NPLs) and potential consolidation looming large.

On the government's plan to merge several Shariah-based banks, he described the initiative as both positive and necessary. Consolidation, he said, would enhance governance, improve regulatory oversight and ensure better risk management.

"With proper implementation, it can play a pivotal role in restoring public confidence and supporting the sector's recovery," he said.

While mergers could help stabilise weaker institutions, the chairman said such processes must be transparent and not provide a shield for defaulters.

On governance reforms, Khaled welcomed Bangladesh Bank's efforts to strengthen oversight but urged caution over the proposal to limit family members on bank boards. He said the wide legal definition of "family" could unintentionally exclude experienced, independent-minded directors and lead to unintended consequences.

He called for evidence-based policies to ensure such measures deliver stronger governance without adverse effects.

Assessing the wider economy, Khaled said the financial sector was undergoing a difficult but necessary transition. Acknowledging the true scale of non-performing loans, though painful, is a healthy step towards transparency and discipline.

While liquidity remains tight and credit growth subdued, he pointed to stabilising factors such as regulatory reforms, IMF support and the move towards a flexible exchange rate.

The priorities now, he said, are governance, capital strengthening and risk-based lending. At the same time, digital finance and agent banking are expanding reach and resilience.

"If reforms are sustained, I am confident the sector will emerge stronger, more transparent, and more inclusive," said Khaled.

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