The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Fidelity Bank (Bahamas) president has set out what he describes as a ten-point plan to seizing market share and more than doubling annual profits to $50m by its 50th anniversary.

Gregory Bethel, writing in the BISX-listed institution’s just-released 2022 annual report, said the bank has identified its “priorities” as greater automation for account opening, loan applications and deposit administration as well as total digitisation so that customers can interact with it via virtual platforms.

Besides upgrading the existing digital platform, which includes automated teller machines (ATMs), online and mobile banking applications and its website, Mr Bethel said opening offices in Exuma and Eleuthera is another core focus. Employee share ownership, as a means to attract and retain the best staff, is also an element in the plan.

Finally, Mr Bethel said Fidelity Bank (Bahamas) is exploring the launch of corporate and private banking units, as well as the introduction of a client relationship management (CRM) tool “to enhance the ability of the bank to ‘mine’ and ‘harvest’ customer data and facilitate targeted marketing”.

Mr Bethel added: “Digital banking, credit cards, business loans, merchant acquiring services and electronic banking, along with a new professional client programme that will comprise a VIP loan product and expansion of credit to the private sector are the foundations for priorities nine and ten.”

The latter refers to launching the corporate and private banking units, and he said: “The bank has an opportunity to take market share from other financial institutions during the next five years. In other words, this is the path to annual net income of $50m by the 50th anniversary of the bank.”

Mr Bethel, though, told Fidelity Bank (Bahamas) shareholders that the institution has seen a decline in revenues from traditional loan and credit facilities as Bahamians continue to struggle with the post-COVID cost of living crisis along with the Government. And he warned that tax increases may have to be considered to dig The Bahamas out of its fiscal crisis by maintaining the confidence of lenders and investors.

“The Government of The Bahamas, faced with substantial increases in expenditure and national debt, must now place greater emphasis on keeping its finances in line with prudential norms, or risk undermining the confidence of the lenders and investors which buy the debt securities issued by the Government of The Bahamas, and effectively fund its operations and activities,” Mr Bethel warned.

“Greater national debt levels are no longer appropriate now that the cost of servicing the national debt is more significant in the national Budget. External national debt is even more costly, as interest rates have been raised in the US and Europe in an effort to combat the widespread threat of inflation.

“Although unpopular, tax increases and/or tax collection efficiency are better alternatives than losing the trust of lenders and investors, not to mention credit rating downgrades by the international rating agencies,” he added. “Bahamian residents commonly report or opine that their financial health has deteriorated. In the face of elevated inflation, most persons are impacted by a higher cost of living with no proportionate increase in income and little, if any, savings.

“Many persons are saying ‘I am barely surviving’ or ‘I am finding it difficult to meet my obligations’. Therefore, against the backdrop of all the issues previously mentioned, the bank has seen a reduction in the rate of growth in its traditional banking products, especially loans and other credit facilities.

“The Bank has sought to offset this experience by offering new value -dded service offerings, including credit cards and merchant acquiring services, to businesses and individuals. Additionally, the bank has invested significant sums in information systems and personnel for these new lines of business and sources of revenue, and expects the full and consistent return on its investment in the next two to three years.”