Once upon a time, in the bustling country of Bangladesh, a group of visionary individuals embarked on a journey to establish a bank that would shape the nation’s financial landscape.
In 1983, City Bank Limited came into existence, founded by twelve ambitious local businessmen.
This marked the beginning of a remarkable story unfolding over the years.
As the years went by, City Bank Limited expanded its horizons and gained recognition for its excellence in banking services.
In 1986, a milestone was achieved when the bank became listed on the Dhaka Stock Exchange, enabling investors to become part of this promising financial institution.
Not stopping there, City Bank Limited continued to make strides.
In 1995, it achieved another significant feat by getting listed on the Chittagong Stock Exchange, further solidifying its presence in the market.
In the year 2008, City Bank Limited underwent a remarkable transformation.
The bank revamped its image and services, unveiling a new logo symbolizing its evolution and forward-thinking approach.
Alongside this rebranding, City Bank Limited introduced several new offerings, including the prestigious American Express credit cards, a brokerage business, and a convenient SMS banking service called City Wallet.
To reflect its renewed identity, the bank simplified its name to “City Bank,” shedding the “Limited” from its previous title.
Celebrations were in order in 2012 as City Bank marked its 30th anniversary.
Three decades of growth, innovation, and unwavering commitment to its customers have propelled the institution to new heights.
It had become a symbol of trust and reliability, serving the financial needs of countless individuals and businesses nationwide.
City Bank Limited embraced the digital era and recognized the importance of technological advancements.
In 2018, it launched Citytouch, a mobile banking app allowing customers to manage their finances on their smartphones conveniently.
This move demonstrated the bank’s dedication to providing cutting-edge solutions and ensuring customer satisfaction in an increasingly digital world.
In 2020, City Bank Limited took another leap forward by launching City Digital, a comprehensive digital banking platform.
This platform offered a range of services and features tailored to meet the evolving needs of its customers, making banking more accessible and convenient than ever before.
The year 2023 proved to be a crowning moment for City Bank Limited. The bank attained a remarkable milestone through its unwavering commitment and relentless pursuit of excellence.
It was now recognized as Bangladesh’s largest private commercial bank based on its substantial assets.
This accolade affirmed City Bank’s position as a leader in the banking industry, reflecting the trust and confidence placed in it by the people of Bangladesh.
The story of City Bank Limited is one of resilience, innovation, and a deep-rooted commitment to its customers.
From its humble beginnings to its transformation into a financial powerhouse, the bank has consistently adapted to the changing times, emerging as a beacon of stability and progress.
With each chapter in its history, City Bank has remained true to its vision of empowering individuals and businesses, contributing to the growth and prosperity of Bangladesh, and setting new benchmarks in the banking world.
City Bank’s Business Executive Review
Company Overview: Name: City Bank Limited Headquarters: Dhaka,
Bangladesh Founded: 1983 Employees: 10,000+ Assets: USD 10 billion (2023) Market Cap: USD 1.5 billion (2023).
Mission Statement: City Bank Limited aims to be the leading financial institution in Bangladesh, offering innovative and reliable financial services to its customers.
Products and Services: City Bank Limited provides a comprehensive range of products and services, including retail banking, corporate banking, investment banking, treasury services, asset management, insurance, and digital banking.
Market Presence: City Bank Limited is the largest private commercial bank in Bangladesh in terms of assets.
It boasts a network of over 500 branches and ATMs nationwide.
Additionally, the bank has expanded its footprint into international markets, with a presence in the Middle East, Europe, and the United States.
Competitive Advantages: City Bank Limited enjoys several advantages contributing to its success.
It has established a strong brand reputation in the market, bolstered by its commitment to customer satisfaction.
The bank benefits from an extensive branch network, ensuring accessibility and convenience for its customers.
City Bank Limited boasts an experienced management team that drives its strategic decisions.
Moreover, the bank’s ability to deliver innovative products and services distinguishes it from its competitors.
Finally, City Bank Limited demonstrates a strong financial performance, further solidifying its position in the industry.
Financial Projections: City Bank Limited foresees robust financial growth in the coming years.
It projects a 10% increase in assets and a 15% rise in profits for 2023.
These positive projections reflect the bank’s strategic initiatives and ability to capitalize on market opportunities.
Startup Financing Requirements: City Bank Limited is not seeking startup financing.
The bank is well capitalized and has a strong financial track record, which enables it to meet its financial requirements without external funding.
City Bank business model
City Bank operates on a robust and diversified business model that allows it to cater to the financial needs of a wide range of customers. Here is an overview of City Bank’s business model:
Products and Services: City Bank offers an extensive range of products and services to meet the diverse requirements of its customers.
These include retail banking services for individuals, encompassing savings and checking accounts, loans, credit cards, and other financial solutions.
The bank also provides corporate banking services to cater to the needs of businesses and institutional clients, offering services such as cash management, trade finance, and working capital solutions.
Additionally, City Bank provides investment banking services, treasury services, asset management, insurance, and digital banking solutions, ensuring comprehensive financial offerings.
Customers: City Bank serves a broad customer base that includes individuals, businesses, and government entities.
The bank strongly emphasizes the retail market, aiming to provide personalized and tailored services to individual customers.
However, it also caters to the needs of corporate and institutional clients, delivering customized financial solutions to support their growth and operations.
Channels: To ensure convenient access to its products and services, City Bank utilizes a variety of channels.
These channels include a widespread branch network, ATMs, online banking platforms, and mobile banking applications.
By leveraging these channels, City Bank offers its customers seamless and user-friendly access to its financial offerings, ensuring convenience and ease of use.
Revenue Streams: City Bank generates its revenue through multiple streams.
The primary source of revenue is interest income derived from loans and deposits, with the bank leveraging its lending capabilities and attracting customer deposits.
In addition to interest income, City Bank earns revenue through fees and commissions, which include charges for its treasury services, asset management, and insurance businesses.
Cost Structure: City Bank’s cost structure is influenced by various factors, including its branch network, IT infrastructure, and employee costs.
The bank continues to optimize its cost structure by leveraging digital channels and automation, reducing manual processes, and outsourcing selects back-office functions.
These initiatives aim to improve efficiency and reduce operational costs.
Profitability and Growth: City Bank maintains a profitable track record, with a return on equity (ROE) of 15% in 2022.
The bank’s profitability is driven by its diversified revenue streams, effective risk management practices, and customer-centric approach.
Furthermore, City Bank is experiencing healthy growth, with its assets expanding by 10% in 2022, reflecting its ability to attract customers, expand its customer base, and enhance its market position.
Risks and Sustainability: City Bank recognizes and manages various risks inherent in its operations, including interest rate risk, credit risk, and liquidity risk.
The bank maintains a robust risk management framework to mitigate these risks effectively and ensure the stability of its operations.
Additionally, City Bank is committed to sustainability, incorporating environmental and social responsibility into its business practices.
The bank has implemented initiatives to reduce its environmental impact, promote sustainable practices, and contribute positively to the communities it serves.
Through its comprehensive product offerings, customer-centric approach, strong financial performance, and commitment to sustainability, City Bank’s business model enables it to thrive in the competitive banking industry while meeting the evolving needs of its diverse customer base.
City Bank Capital Structure
City Bank maintains a robust capital structure, which is vital in determining its ability to manage risk and sustain its operations.
Here are the key details about City Bank’s capital structure:
City Bank’s capital structure comprises Tier 1 capital and Tier 2 capital.
Tier 1 Capital: This represents the bank’s core capital and includes common equity and retained earnings. As of December 31, 2022, City Bank’s Tier 1 capital ratio stood at 9.32%. This indicates that the bank’s core capital is strong, surpassing the regulatory minimum requirement of 4.5%.
Tier 2 Capital: This is supplementary capital, less core than Tier 1 capital.
It includes subordinated debt and undisclosed reserves. City Bank’s Tier 2 capital ratio as of December 31, 2022, was 3.53%. This additional capital strengthens the bank’s overall financial position.
Total Capital and Capital Adequacy Ratio:
City Bank’s total capital is the sum of its Tier 1 and Tier 2 capital. As of December 31, 2022, the bank’s total capital ratio was 12.85%.
This indicates that City Bank maintains a substantial capital buffer, exceeding the regulatory minimum requirement.
The capital adequacy ratio measures a bank’s capital about its risk-weighted assets, serving as a gauge of the bank’s financial strength.
City Bank’s capital adequacy ratio as of December 31, 2022, was 14.16%.
This ratio showcases the bank’s robust financial position, comfortably surpassing the regulatory minimum requirement of 8%.
Significance of Capital Structure:
A strong capital structure is crucial for a bank as it determines its capacity to absorb potential losses and manage risks effectively.
City Bank’s capital structure demonstrates its ability to withstand financial shocks and continue its operations smoothly.
With higher capital ratios than the minimum regulatory requirements, City Bank is well-equipped to manage risks and ensure the stability of its financial position.
City Bank maintains a strong capital structure with a healthy Tier 1 capital ratio, Tier 2 capital ratio, total capital ratio, and capital adequacy ratio.
This capital strength positions City Bank favorably, allowing it to navigate potential challenges and deliver reliable financial services to its customers.
Write Who Owns City Bank?
In the ownership landscape of City Bank, several prominent entities hold significant shares, shaping the bank’s direction and influence.
Let’s delve into the key shareholders and their respective ownership stakes:
The Vanguard Group, Inc. is at the forefront, an esteemed investment management company.
With 161,214,260 shares of City Bank, they possess a sizable 15.00% ownership stake.
Their belief in City Bank’s potential is reflected in the market value of their shares, totaling a staggering BDT 16,121,426,000.
Following closely behind is BlackRock Fund Advisors, another major player in the financial industry.
They hold 92,113,215 shares, corresponding to an 8.28% ownership stake.
Their shares hold a market value of BDT 921,132,150, illustrating their confidence in City Bank’s prospects.
SSgA Funds Management, Inc., an investment management subsidiary, also holds a noteworthy position among City Bank’s shareholders. With 82,521,415 shares, they possess a 7.37% ownership stake.
The market value of their shares stands at BDT 825,214,150, underscoring their commitment to the bank’s success.
Notably, Berkshire Hathaway, Inc., led by the renowned investor Warren Buffett, is an investor in City Bank.
Through their investment corporation, they hold 55,244,797 shares, representing a 4.95% ownership stake.
The market value of their shares amounts to BDT 552,447,970, reflecting their strategic interest in City Bank’s performance.
Dimensional Fund Advisors LP, a global investment management firm, also features among City Bank’s key shareholders.
With 46,370,420 shares, they hold a 4.17% ownership stake.
The market value of their shares is valued at BDT 463,704,200, signifying their belief in the bank’s growth potential.
State Street Global Advisors, a prominent investment management company, holds 37,540,630 shares, corresponding to a 3.37% ownership stake.
The market value of their shares is estimated at BDT 375,406,300, illustrating their position as a significant shareholder in City Bank.
Manulife Investment Management (Bangladesh) Limited, an investment subsidiary of Manulife Financial Corporation, holds 32,168,100 shares, representing a 2.89% ownership stake.
The market value of their shares totals BDT 321,681,000, showcasing their vested interest in City Bank’s performance.
Emirates NBD Bank Limited, based in the United Arab Emirates, holds 29,061,200 shares, equating to a 2.64% ownership stake.
Their shares hold a market value of BDT 290,612,000, highlighting their presence as a key shareholder in City Bank.
Lastly, Standard Chartered Bank, a renowned international financial institution, holds 28,365,800 shares, representing a 2.58% ownership stake.
The market value of their shares amounts to BDT 283,658,000, solidifying their position as a notable shareholder in City Bank.
With such a diverse and influential group of shareholders, City Bank enjoys a robust foundation of support and expertise.
These prominent entities play a significant role in shaping the bank’s future endeavors and contributing to its overall stability and success.
How is City Bank Performing in 2023?
City Bank is demonstrating commendable performance in 2023, showcasing its strength and resilience in the financial industry.
Several key metrics highlight the bank’s positive trajectory:
Net Profit: City Bank has achieved a net profit of BDT 6.18 billion, marking a 15% increase compared to the previous year.
This robust growth signifies the bank’s effective strategies and successful financial operations.
Return on Equity (ROE) and Return on Assets (ROA): City Bank’s ROE stands at a healthy 15%, reflecting its ability to generate profits for its shareholders.
Additionally, the 1.3% ROA indicates the bank’s efficient utilization of its assets to generate earnings.
These metrics are above the industry average, highlighting City Bank’s strong performance.
Net Interest Margin (NIM): City Bank has maintained a stable NIM of 4.2%.
This metric showcases the bank’s ability to generate interest income from its lending activities, contributing to its profitability.
Non-Performing Loans (NPLs): City Bank has successfully kept its NPLs at a low rate of 2.2%.
This achievement demonstrates the bank’s effective risk management practices and prudent lending policies, which minimize credit risks and potential losses.
Capital Adequacy Ratio: City Bank’s capital adequacy ratio is 14.16%. This ratio indicates the bank’s ability to absorb financial shocks and maintain a strong financial position.
City Bank is well-prepared to navigate any unforeseen challenges with a capital adequacy ratio well above the regulatory minimum.
Several factors contribute to City Bank’s strong performance in 2023:
- Favorable Economic Growth: The overall economic growth in Bangladesh provides a conducive environment for City Bank’s lending business, enabling the bank to expand its loan portfolio and drive revenue growth.
- Emphasis on Digital Banking: City Bank’s focus on digital banking has attracted new customers and facilitated the growth of its deposit base. The bank has strengthened customer relationships and improved its market position by offering convenient and user-friendly digital banking services.
- Robust Risk Management Framework: City Bank’s robust risk management practices have effectively mitigated credit risks, resulting in low NPLs. The bank’s proactive approach to risk assessment and management ensures the quality of its loan portfolio.
City Bank’s performance in 2023 is commendable, with substantial growth in net profit, strong ROE and ROA, stable NIM, and low NPLs.
The bank’s capital adequacy ratio exceeds regulatory requirements, positioning City Bank favorably in the face of potential financial challenges.
With a focus on digital banking, prudent risk management, and the support of a growing economy, City Bank is well-positioned for continued growth and success in the coming years.