Juliet Morris of International Banker interviews Jean-Louis Menann-Kouamé, CEO of BICICI on his banks great annual results, the relationship between the bank and the BNP Paribas Group and the future of banking in the Ivory Coast.
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I’m delighted to be joined by Jean-Louis Menann-Kouamé, the chief executive officer of BICICI. Welcome. Lovely to have you with us.
Thank you, Juliet.
According to the bank’s recent financial results, you managed to record an annual growth in profit after tax of 31 percent. What would you say is the main reason for such spectacular growth?
First of all, let me thank International Banker for this opportunity to present BICICI and what we do in the Ivorian market. Actually, we had very good results in 2016. Thanks to the quality of the economy of the country. Things are going quite well in Côte d’Ivoire from an economic point of view. A lot of investors. Some big projects to finance, and etc., etc. And in this environment, we try to do our best to increase our net banking income. At the same time, we made a lot of efforts to keep our charges, our general expenses not very high. And we really work hard to have a good cost of risk; so net banking income, general expenses and net cost of risk—when we work on these three topics, we have good results.
At the same time, the bank’s dividend payouts have sharply declined. If I’m not mistaken, by 37-1/2 percent compared to what they paid out in 2015. Why is that?
In our area, we had new requirements about Basel II and Basel III. So the central bank, for example, asked the bank to reach a solvency ratio in 2022, which will be 11.5 percent. Now the requirement is only 8 percent. So we have to strengthen our equity. We can do it in two ways. By subordinating debts. Or by function of part of our results. We decided, the board and the general assembly, decided this year to keep a part of the very good results of 2016 in the equities. So for years to come, maybe we’ll have the same decision to take. But I think that we have, we absolutely need to get, to be compliant with the ratio, solvency ratio that I talked about.
How happy are you with the bank’s current level of profitability?
First of all, the Ivorian banking sector is a very, very competitive one. And when we can have a 30-percent growth of our net profit, for sure we are very happy. But I think about my colleagues. I think about BICICI employees working very hard to get this result. So for sure, we are happy. But we need to be very focused and do it again year after year.
BICICI’s second business center was recently opened in the Yopougon industrial zone. What is the bank’s strategic aim for creating this new center?
You know, Abidjan is a very big city. Around six million inhabitants. And we only have one corporate business center. And we can see that in this part of the city, Yopougon, which is north of Abidjan, we can see more and more clients, more and more industries, want to be located there. So we thought that it was a good idea to be near our clients. So we sent to our clients a clear message: “We are here for you. We will be near you. And we will give you the best quality of service. And this is why we wanted to reduce the distance between you and our central corporate center.” And our clients are very, very happy. Only some weeks after the inauguration, we see that it’s a good, good idea. And we are very proud about it.
So it’s about creating a presence outside of the center of the town. And do you plan to do more of that?
Maybe, why not? Maybe we’ll launch another business center. We’ll see. The first years, the first months, and the first years of the second business center. And maybe we’ll be able to open another one in Abidjan or in another town in the country.
I understand that the bank recently launched its Applet mobile application, which is now available on Google Play and also the Apple Store. How popular has this app been amongst the bank’s customers so far?
The digital is a very key strategy ambition of our group BNP Paribas. We want to make a lot of effort to provide digital applications to our clients. So in Côte d’Ivoire, we lent our Applet mobile, and our clients are very happy about that. Because it allows them to do a lot of transactions—transfers, credit simulation, they can see the new projects that we are launching. They can do a lot of things with the application, and they are very, very happy about that. We are a modern bank, and we prove it with the Applet mobile as we launched it some months ago.
How developed is the microfinance sector in the Côte d’Ivoire, and does BICICI have any plans to develop more of a presence in the future?
Microfinance is necessary for a country like Côte d’Ivoire; but frankly some of the microfinance institutions are in some trouble because of nonperforming loans. And two or three of them are very well-organized with good, good governance, and we plan to, or we are doing it right now, but we want to refinance them, to lend them some credit line in order to give them the strength to do their job. So we will not do in our branch microfinance activities, but we will support the good microfinance institutions when they show us that they are well governed, they are well managed.
How would you describe the working relationship that BICICI has with its parent company, BNP Paribas? And in which particular areas of the business do you believe and feel that you’re offered the most support?
It gives me the opportunity to tell how we are proud, we are very proud to be part of BNP Paribas, to be a subsidiary of BNP Paribas. And let me tell you that we benefit from this bank, from this headquarters. We benefit from a lot of advantages. For example, in the one-bank concept…one-bank concept means that when we follow an international client, we give him the same quality of service in Paris, in London, in Morocco or in Côte d’Ivoire. And this one-bank concept is a very strong concept from BNP Paribas headquarters. We have also some support in the tools that we need to support the business. We have great support also in compliance management in order to be very strict in how we lead our business. So I can…human resources, for example, we have a professional organization of our approach, thanks to what we receive from the group in organization and in things we have to do. So very, very strong support from our headquarters. And even if we are in Côte d’Ivoire, we launch, we manage our activities in the same way as BNP Paribas.
I understand that you were one of 25 signatories for a corporate diversity charter for Côte d’Ivoire. Perhaps you can briefly explain to us the objectives of the charter, and whether it requires any action or commitment from you to make it happen.
The charter of diversity was launched by our headquarters in Paris, by BNP Paribas, and a lot of other big companies in France. And after that, BNP Paribas decided to broadcast the initiative in some of the countries where it has some subsidiaries. Morocco, Senegal and Côte d’Ivoire. And we were very proud to launch the initiative in our country, backed by BNP Paribas. And let me tell you that when we talk about this to our friends, our companies, big companies in Côte d’Ivoire, they accepted to be part of the initiative. So our objectives are clear. We have seven commitments. Let me tell you two or three of them. For example, we have a strong commitment in the employment of people with disabilities. We also have a strong commitment in the fact that we wanted to reflect the Ivorian social and cultural diversity in our workforce. It’s very, very important. We wanted to have no discrimination in human-resource management at all steps of human-resource management. Recruitment, training, bonus, promotion, etc. And some commitment. And so it’s a very important thing. The vice-president of Côte d’Ivoire, Mr. Kablan Duncan, went to our office to launch officially the initiative with the other companies. It was a very, very great moment.
How important is this initiative? How important is it that it works?
It will be important when we will go ahead. When we will not be only 25 companies involved in this subject. And let me tell you that the most important association of private companies in Côte d’Ivoire decided to help the leaders of the initiative and broadcast it in all the companies of Côte d’Ivoire. So I think that this will be important because we will have a real impact in our companies and in our workforce.
And it’s something that investors want to see nowadays.
For sure. For sure. I think that’s a good point for Côte d’Ivoire to show investors that we are at international standards regarding this discussion.
For you, what is the toughest aspect of being the CEO of BICICI? What’s the hardest bit?
The hardest moment is when talent tells me that he don’t want to work with BICICI anymore. And he wants to go to one of our competitors. This is one of those times that I’m very, very sad, you know. Because we work hard to keep them. We work hard to keep talent. We work hard to involve all of our staff in the underlying plan that we have for the bank. And when one important part of the team wants to leave, I’m very, very sad. Yeah. This is one of those difficult times.
And what makes you feel happy?
Clients. Clients. When clients tell me or tell us that we can see that you improve your quality of service; we can see that this credit line has been implemented quickly; we can see that your branches are very clean, etc. When we have the feedback from our clients, a good feedback from our clients, yeah, we are very happy, and we know that we work hard for something for them.
Is there much communication between BICICI and other BNP Paribas subsidiaries within Africa? And if so, what are some of those main areas where you would work together?
Yes, we have in the West African region and between the West African subsidiaries of BNP Paribas, we have shared services centers. So we have competency center. We have it in Treasury and fixed income. We have it in communications. In legal affairs. In marketing. In IT. And this allows us to share our point of view. This allows us to give…this setup gives homogeneity of approach of BNP Paribas subsidiaries in this region. So we work together, and these centers, these competency centers that I talked about, are very key in the way that we work together.
One of the bank’s main aims is by 2020 to have expanded its ISO Certification to all of the activities devoted to the bank’s clients. Are you on track to meet this objective?
This is in fact a very ambitious objective to have a certification for all the front-office activities of the bank. This is very ambitious. Now we only have this certification for two activities: international transfer, domestic transfer; and for sure, it will be difficult. But our team, our human resources, our employees are very committed in this topic. Because it’s directly linked with the quality of service, we, our clients ask for. So we will work hard. We have three years in front of us to achieve this goal. It will be very difficult. But I told to my employees, I told to my colleagues, that if we want to transform the bank, if we want to strengthen the bank, if we want to reach the great quality of service that our clients in a competitive market we have to face, if we want to achieve all that, we need to work hard to get this certification. And I think that we will be on time. We are on the good track, and we will be on time. I promise.
It’s always dangerous to promise.
We’ll do our best.
In your opinion, which one area across the Côte d’Ivoire banking sector needs the most attention at the moment?
Maybe I can talk about SMEs’ financing. SMEs’ financing is, it’s quite tough right now in the Côte d’Ivoire. And this is why last year’s, at the end of the year, an initiative has been launched called Commitment of Finance for SMEs. And we are part of this initiative. And the whole financing ecosystem in Côte d’Ivoire say that we have to do something to give more strength to SMEs, and we have to do it on a yearly basis. So year by year we’ll make the assessment of what we have done and try to go ahead for the next year. It’s very concrete. It’s a concrete approach. And at the end of this year, it will be the first time that we’ll assess what have we done concretely for the SMEs in Côte d’Ivoire.
And for you, what benefits will this pay the bank and the SMEs? What will you get from it?
We will get more clients. We will get more financing for the clients. We’ll have more profitability from this segment of clients. And for sure, it will be good for the country, too. Because SMEs love employees. SMEs are good contributors to the growth of the country. So I think that it’s a good thing to support them. But we cannot support them in a bad way. We have to, it’s a win-win deal. And we have to make efforts. They have to make efforts, too. The central bank, the government for tax issues, have to make some efforts. We have to make some efforts. And for sure, there will be benefits for all the ecosystem.
What is the one objective above all others, if you’re able to focus on one, that you would like to achieve and leave as your legacy when you move on from BICICI as their chief executive? If you move on?
Yes, for sure I will move on. It will be about the employees, of being of BICICI, about the employees of the bank. When they come to the office in the morning, I just want them happy. I just them happy and say, “Yes, we know where the management wants us to go. We know what is the strategy of the bank. And we understand the strategy. And we approve the strategy. So we are proud to be part of the achievement.” If we work to create this feeling in all our employees, I think that it will be a good legacy for the CEO in the years to come.
Mr. Menann-Kouamé, thank you very much for talking to me.
Thank you, Juliet, thank you.