This is a translation of the interview with CEO of Golomt Bank Mongolia G.Ganbold appeared on 6th of February, 2014 on news.mn. Business-Mongolia.com selected only the relevant parts of the bank’s operations.
How would you evaluate last year’s performance of the bank?
For a financial institution, stable growth is preferred over high volatility whether it is negative or positive. As the end of 2013, our asset has grown by 48% and reached MNT3.73 trillion. Also, bank’s own asset increased by about 40% reaching MNT314.9 billion, net profit increased by 75% reaching over MNT47 billion. This symbolizes our stable growth in the past 15 years and shows our well establishment in the financial system of the country.
Moreover, following figure will explain how well our core financial indicators that represents the credibility of our bank – liquidity ration 43.3%, and return on asset 1.5%, and own asset return 22%. Although Mongolian economy didn’t grow as expected, the government and the central bank implemented certain projects, and suitable monetary policy under the times of uncertainty resulting overall growth in the economy.
We facilitated many projects and policies implemented by the government such as New Mortgage Policy and SME loans. Golomt Bank provided 30% of all New Mortgages. We will maintain our position as the epicenter of the Mongolian economy.
Last year, there were disputes among the shareholders which also draw many people’s attention.
That is true. However, it is was an issue of a major shareholder of Bodi International LLC. Last year, we overcame many difficult obstacles. Bank is a business of trust. As a trust based business, any disputes regarding shareholders directly affects the bank’s operations. Last year was indeed a turbulent year for us, and also, it tested our team and overall bank’s immunity. Our customers understood us very well and stayed with us during the difficult times. Therefore, we would like to thank all of our customers.
Can you confirm that all the issues have been resolved?
Indeed. All of the issues have been resolved and we opened a new page for the bank’s future development. I would like to state responsibly that our partners and customers have nothing to worry. As a CEO of the bank, I am responsible for the “health” of the bank and its everyday operations. Bank is very healthy, and it is like a athlete that is ready to compete with anyone.
What would be the new phase of the bank’s development?
In the past, bank has been owned by family members. The new phase would direct the bank into becoming a public company. Also, the operations of our subsidiaries have stabilized. The governance of the bank is reaching the international standards. Aligned with the new development strategies, daughter companies are being transferred to our staff transferring itself from a single owner to publicly owned.
We started offering stock options three years ago and over 300 staff of our bank currently holds stocks. The President of Mongolia proposed an idea that large Mongolian companies should offer 20% of the shares to the public, and we support the idea. We will grow, and our competency will become stronger.
Recently, international news agencies such as Routers and Bloomberg reported controversial news regarding Golomt Bank. It included rumours that Itochu, Credite Suisse, Abu Dhabi Fund’s withdrawal of the bank. What is your position on this issue?
The fact that many international news agencies propagated news based on false information which was very one-sided amazes me very much. It raises the questions about the purpose behind it.
Issues regarding Itochu and Credit Suisse have been resolved completely. As for the Abu Dhabi Fund, it is not an investment, but a second tier convertible debt. As I previously mentioned about new phase for the bank, Golomt Bank started accepting foreign investment and partnerships from 2007. The issue regarding the Abu Dhabi Fund is a misunderstanding between Stanhope Capital, which Golomt Bank is a shareholder, and the fund. Unfortunately, the news agencies released a very one-sided news. As for us, we are confident in our position.
Personally, I think investment companies that are expecting high returns, also, shall share the risks. A business should be in accordance with the agreements. Therefore, our stance is that sides must be in compliance with the agreement. I don’t think a debt agreement that doesn’t even reach 1% of our asset should be targeted to vilify our reputation.