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Shortage of skilled staff worry GCC bankers

Shortage of skilled staff worry GCC bankers

Without enough skilled staff, banks are just about falling short of catering to increasingly demanding customers. Will the local market make up for the shortage or will banks look abroad?

November 29, 2011 4:08 by

The GCC’s banking sector has been nothing if not abuzz. In the UAE alone, banks have been all sorts of busy. Back in March, the use of telemarketing to lure new clients has been banned (unfortunately, if you’re already an existing client then they can still pester you on the phone).

Then over the summer, there were those regulations from the UAE central bank, giving more stringent requirements for financing and loans.
Then of course there’s Qatar’s involvement with the banking sector in Greece this October when the Qatar Investment Authority got involved in the merger between two of the largest banks in Greece.

And across the GCC, there have been whispers of reviving the unified currency discussion, not to mention financial transactions would have been thrown for a loop considering the current political climates in Bahrain and Kuwait.

As reality of a new banking order sets in and banks prepare for new opportunities and services to fulfill, most of them are challenged to find the right kind of staff to get them through this time of transition.

And this is just what the latest Accenture survey has found. In a letter accompanying the release, Managing Director Amr Elsaadani said:

In a region with traditionally low customer penetration, banks will compete to acquire and retain customers, underscoring the need to stay differentiated. While with continuing global systemic risk and a tightening regional regulatory environment, it is even more important to ensure a strong competitive position.

The global management consulting firm spoke to 47 executives at major banks in the GCC between June and August 2011 for the report, which found the majority (58 percent) stating “skills shortage is the biggest challenge facing the GCC banking industry, aside from new regulation– especially as more global banks enter the market.”

Nearly two-thirds (64 percent) of respondents agreed that the biggest impact of more global banks operating in the region will be the increased competition for skills and talent over the next few years. A majority (89 percent) of respondents said that attracting and retaining talent will be the most important strategy their banks will use to increase shareholder value.

This shortage may be an opportune time for those who’ve lost banking jobs in the West, where the workforce has drastically shrunk. These same experienced hopefuls would, assumedly come head to head with locally-based bankers who have been redundant and are still on the job hunt as well as with new university graduates desperate to get a foot in the door.

So what’s being done? Banks are apparently implementing a range of initiatives to address skill shortage and retain talent. Among these are:

  • Coaching and mentoring (53 percent)
  • Revamping compensation through higher salaries and bonuses (51 percent)
  • Increasing transparency in career paths (47 percent)

According to the survey, customers in the Gulf region are becoming more demanding and less loyal to their institutions.

Improving customer service was cited by executives as the single most critical challenge to attract and retain customers through 2015. In fact, 46 percent of executives cited it as “critical” and 30 percent cited it as important.

Meeting increasing demand from customers for online and mobile services was cited as a top challenge by 79 percent of respondents. And, 71 percent of executives said declining customer loyalty would be a major challenge through 2015.

And here are other findings:

  • 93 percent of executives see “robust customer management” as the top driver of profits and growth through 2015. This was ranked higher than better risk management, pricing, and cost reduction.
  • 87 percent believe “improving customer centricity” will be the most important strategy their banks can use to address market challenges and outperform the industry. This was ranked ahead of product innovation, productivity improvement, risk management, product distribution, diversification of businesses, new operating models and cost reduction.

Meanwhile, the region’s banks are in a race to adapt to more demanding customers and are increasingly targeting the largely untapped youth, women and small- and medium-sized business markets.

The survey revealed that an overwhelming majority of respondents (91 percent) are investing in…(CONTINUED TO NEXT PAGE)

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1 Comment

  1. MMMMMMMMMMMMM on November 30, 2011 6:40 am

    Bank will be certainly better off looking abroad:
    While Re-exports rose to 86 billion dirhams in the first half of the year from 69 billion in the same period in 2010. Dubai’s non-oil trade data exclude trade in its free zones. Concerns about Dubai’s liabilities have eased since state-owned firm Dubai World reached a deal last year to restructure almost $25 billion of debt. What is not said clearly is that in the restructuring exercise, there is no proper provision to service interest on timely basis. The UAE, which enjoys the world’s sixth highest per capita income of $47,400, has avoided popular unrest, which challenged governments in nearby Bahrain and Oman in February and March. Not for long as Dubai will need to repay, in all, about USD 26 billion to banks/institutions in the region. It will take them at least 8 years from now to come to a positive cash flow situation. In the mean time, banks operating in Dubai will be forced to write-off USD 2 billion/year for the next 4 years. But they as well as the banks operating there which have restructured the major loans will not admit to this. Enjoy the life in Dubai as in the next 4 years the number of banks operating in Dubai will be forced to reduce from the present 59 to 19 as the loss making banks would have left the shores by then (infact should leave soon if they are smart and wish to cut losses).


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