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Saturday May 18th, 2024

Ayodhya Iddawela Perera on Charting Sampath Bank’s Future

Ayodhya Iddawela Perera Managing Director of Sampath Bank

Ayodhya Iddawela Perera, the newly appointed Managing Director of Sampath Bank, provides insight into the bank’s future amid Sri Lanka’s economic fluctuations. Since 2019, the nation has faced economic challenges, primarily affecting SMEs and Retail.

In this interview, Ayodhya emphasizes a pivotal shift for banks towards agility, digital advancements, and customer-centricity. Sampath Bank remains poised for unwavering growth, committing to both people-centric and tech-driven strategies. Their commitment is evident in facilitating national recovery, supporting businesses in global ventures, and leading the digital banking revolution. Excerpts of the interview are as follows:

Considering the current economic challenges and the proposed DDR, what is your outlook on the banking sector in Sri Lanka, and how do you envision its future?
Since 2019, Sri Lanka has navigated tumultuous economic waters, with SMEs and the Retail sector feeling the most significant brunt. While the current environment is brighter than the peak of the 2022 crisis, we must recognize that such economic adversities may become a recurring theme. Around the globe, nations grapple with unparalleled hurdles, whether they stem from fluctuating interest rates, economic downturns, the ramifications of climate change, food security, conflicts, or political instabilities.

Given this landscape, I foresee a transformative era for banks. They will evolve to be more nimble, informed, technologically adept, and customer-focused. Agility and adaptability will be paramount for Sri Lankan banks to thrive amidst recurrent challenges, and bankers should not just be transaction handlers but evolve into insightful financial consultants and problem solvers. Also, the traditional banking model of pushing products will be obsolete. Instead, the onus is on banks to reinvent and elevate the customer experience, and the imperatives of data and technology will be to ensure continuity, enhance speed and efficiency, and tailor banking services to individual needs. This shift is pivotal as customer demands and expectations diversify and heighten as their ability to switch services becomes easy while they gain amplified voices through social media.

Regarding the DDR, we appreciate the foresight exhibited by the government, the regulator, financial advisors, and the IMF in shielding the banking sector. Considering the repeated economic jolts, it was evident that banks could not bear additional burdens, a realization that these entities embraced. By excluding the banks, there is an anticipated surge in capital adequacy, which, in turn, fosters resilience and propels loan growth – vital catalysts for post-crisis rejuvenation.

Admittedly, banks are steeling themselves for a possible haircut on the ISBs, but most banks have already made provisions for this adjustment. For Sampath Bank, our robust capital foundation ensures our unwavering growth trajectory. We remain committed to expanding our influence, envisioning a future where Sampath Bank is at the heart of economic transformation and the digital revolution. Our investments are not just financial, they are also in our people’s wellness and advancement. Additionally, our substantial budget allocation to technology underscores our unwavering
dedication to reinventing banking experiences for our clientele.

How does Sampath Bank plan to contribute to the nation’s recovery?
Every bank has a pivotal role in aiding the nation’s recovery, and for Sampath Bank, a local institution deeply rooted in domestic business, this responsibility is even more profound. From the
onset of the challenges in 2019, our dedication to our customers has been unwavering, always prioritizing their well-being. We took proactive measures during these times, restructuring and guiding our clientele, understanding that their resilience is essential for the broader economic rebound.

With the economy now on more stable ground, the spotlight is on recovery. Credit, often termed the economy’s lifeblood, will be crucial in this phase. Banks, including ours, are entrusted with the
responsibility of directing credit towards sectors that promise robust and enduring resurgence.

Recognizing the global shift towards environmental consciousness, we see immense promise in the ESG, Green, and Blue financing domains. As a leading financier in the renewable energy sector, our ambition is to expand our footprint across a broader range of environmentally-aligned initiatives, aligning with both national and global objectives. This is the roadmap Sampath Bank, alongside other Sri Lankan banks, envisions for the nation’s rejuvenation.

Given the challenges faced by Sri Lankan businesses, how will Sampath Bank support their growth and global expansion?

Amid the crisis, we stood shoulder to shoulder with businesses, guiding them through turbulent times. As we move forward, business growth will hinge on seizing economic opportunities, and we are committed to partnering closely with businesses to identify these. Rest assured, we’re poised to support any promising business venture that comes our way.

With the government’s robust push towards exports, we recognize this sector as a linchpin for future sustainable growth. We ardently encourage our clients to explore overseas markets and diversify their product offerings. Yet, given the current global and local volatility, we also advise them to tread with caution, ensuring opportunities are thoroughly vetted before diving in.

How is Sampath Bank leveraging technology in this digital era?

From its very foundation, Sampath Bank has been synonymous with pioneering technological innovation to elevate the banking experience. Our sustained investment in this domain emphasizes our commitment to staying at the forefront of the industry. For us, technology isn’t just a tool; it’s the lifeblood of our operations.

Our steadfast commitment to digital advancements, both within and beyond our walls, has enabled us to operate efficiently. Remarkably, even as our asset base has tripled since 2014, our employee
count has remained consistent, a testament to our emphasis on efficiency and innovation.

Products like Sampath Vishwa and WePay are prime examples of our dedication to our customers. Notably, Vishwa has garnered immense trust and loyalty over time.

We recently ushered in features that amplify user convenience: a streamlined digital onboarding process and AI-powered bots to promptly address customer inquiries. Behind the scenes, we’re not only digitalizing our operations but also fortifying a data and analytics-centric core. This robust foundation is geared to power our future endeavours, ensuring continued growth and enhanced customer engagement.

How do you see technology influencing the bank’s growth strategy and the industry’s future?

As Gen-Z and Gen-Alpha enter the workforce, the future of banking is unequivocally heading towards a fully digital mode. However, considering that the economic landscape is still heavily influenced by the Baby Boomers and Gen-X, this transformation will be gradual. Our growth strategy is meticulously designed to embrace this phased evolution. We aim for our technology to serve every customer demographic, while internally, we’re racing towards this digital future.

The influence of technology on banking is anticipated to be deep and transformative. Credit evaluations will pivot from primarily asset-backed models to being driven by data and analytics. Biometrics will become the gold standard for identification and security. Physical cash will cede its place to digital currencies, while mobile platforms will overshadow traditional branches and ATMs.
Banking communications and marketing will become individual-centric and tailored. Furthermore, all financial transactions, be they deposits, withdrawals, or disbursements, will be executed instantaneously.

At Sampath Bank, we have envisioned this future and are arming ourselves for it. Yet, our approach is deliberately phased, ensuring we remain firmly rooted in present-day realities.

How is Sampath Bank promoting international trade and investments?

For Sri Lanka’s economic revival, both investments and international trade play pivotal roles. Recognizing this, as a premier banking institution, we’ve actively partnered with entities like the BOI, EDB, and the Ministry of Industries.

In collaboration with the BOI, we’ve introduced an Investor Guide on Banking to streamline foreign investments in Sri Lanka. Furthermore, our close association with Port City aims to attract investors to its Special Economic Zone. We’re also liaising with global funds and multilateral organizations to channel foreign capital towards local projects.

Regarding international trade, Sampath Bank stood out during the peak of the crisis by ensuring the provision of foreign currency to our customers and businesses. While our reputation in imports remains robust, we’re amplifying our focus on exports. Grasping the nation’s emphasis on bolstering exports, we established a dedicated Export Financing Unit in late 2021. Here, we offer comprehensive services from pre and post-shipment financing to specialized export advisory services. Our resilience during the crisis has fortified trust in our capabilities, positioning us ideally to nurture SMEs into becoming exporters and also cater to the demands of established exporters.

Are there any special programmes or collaborations to encourage foreign investments?

As previously stated, we’re actively collaborating with the BOI to provide the necessary support for investors looking to establish businesses here. Recognizing this as a national imperative early on, we have given our unwavering commitment to streamline and simplify the investment process for foreign investors. During our interactions with overseas funds and investors, we consistently champion investing in Sri Lanka. Moreover, we’re coordinating visits abroad alongside Sri Lankan authorities to advocate for investments in our nation, continuing a practice we’ve upheld even before the economic crisis.

How does Sampath Bank ensure sustainable and equitable growth?

Long before sustainability became a global imperative, it was already deeply ingrained in Sampath Bank’s foundational values. From the very beginning, our commitment to our stakeholders has been evident.

Businesses operate within a vast tapestry that encompasses employees, customers, shareholders, partners, regulators, governments, local communities, and the environment. To thrive in
the long term, an organization needs to harmonize its interests with those of these diverse entities. When this balance is achieved, the organization naturally outpaces its competitors in growth.

Moreover, the fruits of success must be equitably shared among all these stakeholders, including the environment. This holistic approach underpins Sampath Bank’s vision for sustainable and equitable growth.

Do you have specific strategies or benchmarks in place for sustainability and fairness?

We approach things differently. Instead of crafting specific strategies for sustainability and fairness, we embed these principles into every strategy we devise, ensuring they are sustainable and equitable for all stakeholders. Sustainability and fairness aren’t just checkboxes; they permeate every decision we make. Take, for instance, our strategy for promoting SME growth.

If this growth comes at the expense of the environment or negatively impacts the local community, it’s bound to face resistance. Such a strategy would be neither equitable nor sustainable, leading to its eventual failure. Therefore, a truly effective strategy must meet both sustainability and fairness criteria. In the context of our SME strategy, this means that every SME we support should also operate with sustainable and equitable practices.

Euromoney recently recognized Sampath Bank as the Best Bank in Sri Lanka for 2022. As the newly appointed Managing Director, what is your vision for the bank?

Being recognized as the Best Bank in Sri Lanka is a tremendous honour, and this title is not just a badge of prestige but a reflection of the relentless efforts of the Sampath Team, the unwavering loyalty of our customers, and the consistent support from all our stakeholders. While I gratefully acknowledge this distinction, I believe there is always room for improvement. A title earned in 2022 holds little weight in 2023 unless we continue to surpass our previous achievements.

My vision is for Sampath Bank to be agile, driven by knowledge, enhanced by technology, and centred around our customers. This is how we can outdo our past accomplishments. Striving for excellence daily is ingrained in the ethos of Sampath Bank, and I am committed to upholding that legacy.