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Ali Jam


To Play the King

CEO & Owner, Royal Bank


Ali Jam was born in 1953, was educated at Houston Baptist University and later gained a law degree from Tulane Law School in New Orleans. He spent 10 years at AT&T in Houston as a production manager, and later in Azerbaijan as a senior legal consultant for BP/Statoil. He is currently the CEO and owner of Royal Bank.

"The Azerbaijani banks are now in a much better position than their regional counterparts."

What have been landmark achievements of Royal Bank since it was established in 1993?

I basically acquired the bank at the end of 2003. At the time we had one office and around 13 people in employment. The development of the country was so strong I couldn’t keep myself out of the current, and it is that current that has brought us to where we are today. Starting at the beginning of 2004, we began developing the core strategies that would drive the bank’s penetration of Azerbaijani society. Back then we focused on the retail business and proceeded to expand the number of branches in the country. Currently, Royal Bank has 32 branches and nine sub-branches. In addition, we now have 630 employees. During the last few years, we have been growing at a faster pace than Azerbaijan’s GDP; 207% in 2007, 179% in 2008, 89% in 2009, and then due to the crisis in the banking sector we focused on consolidating our achievements. Royal Bank’s assets are close to $250 million, its deposits are at about $100 million, and its portfolio is around $120 million. Fortunately, the economic policies implemented by both President Ilham Aliyev and his team—as well as the Central Bank of Azerbaijan (CBAR)—have been really successful and have protected our banks from the crisis, keeping them on their feet.

What activities is Royal Bank specialized in?

Around 90% of our clients are in the retail segment; only 10% are corporate clients. That drives us to be a bank highly specialized in retail services such as loans and credit cards. Our main corporate clients are SMEs, and we have a special department that provides funds to SMEs.

“The Azerbaijani banks are now in a much better position than their regional counterparts.”

What are your views on the state of development in the banking sector in Azerbaijan?

Thanks to CBAR’s guidance, the Azerbaijani banks are now in a much better position than their regional counterparts. Azerbaijan, as a young country with a young banking sector, has a lot to learn from our fellow bankers in the West and the Middle East. In order to achieve this, Royal Bank opened a new bank in Dubai called Royal Investment Bank in 2011. It is an independent entity, but it is basically a way for us to gain more experience from the banking sector in the Middle East and expand our vision to North Africa as well. It is important for us to think regionally rather than locally.

What is your development strategy and plan for future years to leverage your capabilities?

We are concentrating on the credit card business, which is a new area of banking for us. At this point we are also focusing on getting a forex system installed in order to attract local and regional market participants. We are doing this in collaboration with a Swiss bank. Royal Bank is, at the same time, in the process of establishing the technical aspects of banking. We are also very interested in further developing trade financing links between Caspian and Black Sea countries. We think that since the landscape of the banking system has been damaged by the crisis at the international level, the new landscape will form itself. We are trying to move wisely in order to take our place in that new landscape when all the players become involved. The crisis has created pain on the one hand, but also lots of opportunities that can be seen as challenges.

What are your views on CBAR’s increasing efforts to bring the credit card market to international standards and make it safer?

CBAR is learning from the international market and globally the trend is toward e-commerce and non-cash transactions. CBAR is implementing new rules and regulations in the field, and it is in constant contact with banks including ours. Royal Bank has its own card-processing center with lines for Visa, Mastercard, JCB, and China Union Pay. We are the only bank in Azerbaijan that has lines with JCB and China Union Pay.

What’s your general outlook for the financial sector in the years to come?

I am very positive; I think that from a geopolitical point of view we are a rather small but strong country. We have two big neighbors, one in the north and the other in the south, with big economies that have to deal with. Azerbaijan is in a great position and the financial sector is a key one. We are in a privileged position and the times ahead are quite exciting. I think when the West gets back on its feet, the Azerbaijani banking sector will grow even stronger, because we are headed in the right direction.

© The Business Year – January 2012



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