Today we are pleased to be joined by Mr. Dauren Zhaksybek. In addition to currently holding the position of chairman of the board of directors at Kazakhstan’s Tsesnabank, Mr. Zhaksybek also holds many esteemed positions within the world of banking and finance, including Member of the British Committee-Treasurer of the British Chamber of Commerce in Kazakhstan, as well as chairman of the boards of directors of a diverse range of leading companies within the country.
Under Mr. Zhaksybek’s leadership, Tsesnabank has emerged as one of Kazakhstan’s strongest performing and most reputable banking institutions. Indeed, the bank recently won the Asian Development Bank’s (ADB’s) Trade Finance Program award for Leading Partner Bank in Kazakhstan, thus underlining the pedigree of this fast-growing lender.
Mr. Dauren Zhaksybek, Chairman of the Board of Directors of Tsesnabank JSC
Mr. Zhaksybek, thank you for joining us…
I’d like to begin by discussing that partnership with ADB. How has such a relationship enabled the bank to grow its trade-finance portfolio?
In 2016, ADB and Tsesnabank made a deal to provide guarantees to support trade-finance operations. Since then, Tsesnabank has got an access to over 200 partner banks to provide clients with financial support and realized number of deals on very favourable terms for our clients. This year TFP Awards recognized Tsesnabank as Leading Partner Bank in Kazakhstan. We offer full support in foreign economic activities, including assistance in choosing the best external financing solutions.
By providing services for exporters, we can help to cut the risk of non-payment by counterparties with the support of ADB. Our clients can also expand sales markets by taking advantage of trade-finance tools. We see that trade finance has great growth potential, and we look forward to continuing our work with ADB.
You mentioned your clients just there—as far as client coverage is concerned, how important is the SME (small and medium-sized enterprise) sector to Tsesnabank? And what strategy, if any, is the bank adopting to increase its share of lending to this sector?
Servicing SMEs, including loans, is a priority, and we provide a wide range of credit products for developing business. It’s a strategically important area for Kazakhstan’s economy, and also represents an opportunity for us to diversify our portfolio. Our experts analyse projects which offer customers the right financing programs for them with the best terms. The thorough approach of our specialists at each stage of the loan application ensures higher approval rates.
Tsesnabank also finances SMEs through state-support instruments offered by organizations like “DAMU” Entrepreneurship Development Fund, the Development Bank of Kazakhstan, KazAgro National Management Holding and the Agrarian Credit Corporation, among others.
As for yourself, Mr. Zhaksybek, you hold a range of other leadership positions, including Member of the British Committee–Treasurer of the British Chamber of Commerce in Kazakhstan and chairman of the board of directors of Plus Bank PJSC. Does having such a broad range of responsibilities help you perform your leadership role at Tsesnabank more competently? And if so, how?
Participating in various business and social organizations gives me the opportunity to view the market from many different perspectives. This is particularly effective in the banking world, which is so closely connected with economic and societal shifts, the political situation and the overall climate for investment. Given that Tsesnabank’s development is so inextricably linked to the growth of Astana and Kazakhstan, I make a conscious effort to devote my time and energy to projects which deliver social value. Currently, I am the chairman of the board of directors with the following companies: Tsesnabank, Tsesna Corporation, Tsesna Holding, Tsesna Garant, Tsesna Capital, Plus Bank, and I am also the president of Plus Bank. I am also on the board of directors of Bank CenterCredit, a member of Young Presidents’ Organization Kazakhstan, chairman of the Regional Council for Astana’s Chamber of Entrepreneurs, a member of the British Committee–Treasurer of the British Chamber of Commerce in Kazakhstan and a member of the Central Control and Revision Commission for Nur Otan.
That’s plenty of impressive experience there. As I understand, you’ve also worked in a diverse range of locations around the world, including New York and Austria. What advantages do you think possessing such extensive geographical experience brings to your current role as a banking leader at Tsesnabank?
My professional experience abroad underpins my view of modern business models. I follow the policy of a balanced-risks approach. In my opinion, this style of leadership has helped us to weather economic challenges like the global economic crisis of 2008. Being a loan officer in large banks around the world has undoubtedly helped me to diversify our loan portfolio wisely. I also feel confident about taking the bank beyond Kazakhstan. Last year, we entered the Russian market with our subsidiary Plus Bank. I am sure that my experience will be useful as we move into these new markets.
You have been with Tsesnabank for just over 10 years, if I’m not mistaken. During this time, what do you consider to be your greatest achievement? And what do you consider to be the biggest challenge?
10 years is milestone material. While we’ve been through a lot, I think the most significant achievement for me is the growth we’ve seen across the bank’s key indicators. When I took the mantle in 2006, Tsesnabank was 14th in terms of assets—a regional bank known in several cities. Now we are the third largest bank in Kazakhstan with an extensive branch network and the second largest bank in terms of loan portfolio. This is not a personal victory—the hard work of our team and our customers’ loyalty have made it possible to achieve these outstanding results.
Speaking of the hard work of the team, I understand that in 2015 the bank started implementing the Sterling service-culture creation program together with the Service Quality Institute, USA (2015-2018). Can you briefly explain the purpose of these initiatives, and what you hope to gain from their implementation?
In 2015, we were the first bank in Kazakhstan to launch the three-year transformation of our culture using the John Tschohl First-class Service Program through the Service Quality Institute, USA. Our team was trained to be more client-focused, as we understand that impeccable service is one of the main criteria for a company’s success.
All of our employees have completed extensive training as part of the three-year program, and we are planning to conduct the final phase at the end of this year. We would like to note that we are proceeding with other training programs which improve our approaches to service. Ongoing training and customer feedback cycles ensure that we’re always increasing loyalty to the Tsesnabank brand.
As a result, we have significantly improved service quality, and within two years of implementing the project, quality satisfaction grew by 11 percent and the customer loyalty index (NPS) grew by 45 percent. We are sure there is more room for improvement, so we are going to continue our commitment to the first-class service philosophy.
Turning to some of Tsesnabank’s other activities, I believe that since 2012 the bank has been taking part in the Ministry of Education and Science of Kazakhstan’s Road to School campaign, which helps to increase school attendance with children from socially vulnerable families. How successful has this programme been since the bank’s first involvement?
Many organizations, including Tsesnabank, are taking part in the Ministry of Education and Science of Kazakhstan’s Road to School campaign, which helps to increase school attendance of children from socially vulnerable families and raise awareness of this issue. Last April, President Nursultan Nazarbayev launched the program Rukhani Zhangyru: Modernizing Social Conscience, based on developing social responsibility and prioritizing human capital. Acquiring knowledge is a desire innate to all people. These campaigns are created to make education accessible and universal for every child.
For the last five years, Tsesnabank has supported schoolchildren throughout Kazakhstan by acquiring school and sports uniforms for them, as well as other necessary school supplies.
It seems that corporate social responsibility (CSR) is something that is taken very seriously at Tsesnabank. Are there any other projects of note with which the bank is currently involved that you would like to take this opportunity to highlight?
We have many CSR projects, one of them with the Public Fund Mother’s House, a charity for the prevention of child abandonment. Since 2013, I have been a trustee of Mother’s House crisis centers in the cities of Petropavlovsk and Kostanay and, between 2014 and 2015 supported Mother’s House crisis centers in the cities of Semey and Atyrau, until they found long-term sponsors. Since 2016, Tsesnabank has worked with the Adoption Support Center to make family arrangements for orphans and children deprived of parental care. The center also offers support for foster families and finances production of a film series under the title Anashim, meni қaldirma (Mother, don’t leave me).
The Mother’s House project has proven to be a very worthwhile initiative, with over 3,000 children kept in families with their own mothers.
Those projects sound like very worthwhile endeavours. And finally, how do you expect Kazakhstan’s banking sector to change over the next few years?
One of the main trends in IT (information technology) development is undoubtedly “Big Data”. Banks will have to learn to operate effectively with databases, working with terabytes of information to analyse customer preferences. By doing this, we can take client orientation to a higher level, speeding up credit-risk assessments and decision-making, introducing smart advertising and much more. The role of CRM (customer relationship management) systems in this scenario will also continue to see growth.
While digitalization will inevitably impact traditional offices over the next 25 years, I doubt they will disappear completely. Customers will still want to resolve complex financial issues in person. The sense of trust that comes from real human communication still can’t be replaced with technology. I think offline work can be shifted to a more personal advisory focus. Managers will be freed from processing payments and transfers and able to give more time to building partnerships, tailoring financial tools and adjusting services to their specific requirements.
Well, hopefully under your guidance, Tsesnabank will be able to sufficiently negotiate and embrace these developments without too many hindrances in the coming months and years. Mr. Zhaksybek, thank you for your time today.