Message from the CEO

Dear friends & colleagues,

A star is born...

2008 was an important year for dunia, as it was the year of our launch. It was the year that saw the culmination of our passion to build and deliver a unique, new and differentiated model of doing business in the financial services space. It was a new approach designed to serve the large population of under-served customers in the UAE, in our chosen segments – the Consumer Mass Market and Mass Affluent, the Self-Employed Mass Market and the SME.

We had set out collectively as a dream to serve "the customers" by listening to them. We realized early that to be able to do that consistently for customers, we need to build a capability that would deliver services in an empathetic and caring manner. Therefore, as a team, we were driven by a single-minded passion to deliver this by building a rock-solid foundation and serving the customer through a highly diverse, seasoned, and talented team. We had started out with a burning desire to "create history" and I am happy to report that the team made its first mark by launching dunia successfully on the historic date of September 29, 2008.

Born in the midst of uncertainty and adversity...

It was also a very significant year and point of time for the world, including the UAE, as the world went through a period of unprecedented stress and the dynamics of doing business transformed overnight. Suddenly, the global giants and the behemoths of the yesteryears became very vulnerable, lacking the wherewithal to achieve predictable performance, to be able to attract customers or retain talent, and in some cases even unable to remain relevant by not being able to sustain their competitive positions.

The growth engines of the developed world collapsed leading to capital erosion, crumbling asset prices, diminishing trade flows, reduced consumption, and decline in tourism, increased unemployment and drop in commodity prices. Governments and the private sector were unable to invest as before and the result was chaotic. The UAE, being one of the biggest beneficiaries of this recent boom, was impacted as well. The impact was felt strongly as employment was linked to the industries dependent on the sectors most heavily impacted – namely hydrocarbon, real estate, tourism, etc. With dunia’s focus being on the consumer and small businesses, the journey ahead was set to be challenging.

This was our moment...

While many would have felt deterred by the challenges of this uncertain and unprecedented environment, our high energy and talented team saw it as the “big opportunity”. We quickly analyzed the environment to understand why so many businesses in the world had lost their way and whether we needed to recalibrate our model. The findings reinforced what we had always believed and the principles on which dunia had been built – in the face of this adversity, there was an even more compelling need to refocus on the customer, to go back to basics, to focus on quality and base business on sustainable and solid values.

Opportunity lay in focusing on the customer...

We had always been guided by the principle that we needed to go "back to basics" for our customers, and therefore reinforced the need to focus on traditional values that have always stood the best of time. Age-old tested values like "treating customers fairly". "Know your customer", "prudence in lending", "respecting risk and not ignoring it", "suitability and appropriateness", and "past in not necessarily indicative of the future" became our guiding mantras. We were determined to win by delivering our comprehensive customer offerings by focusing on the customer.

We launched dunia well positioned to serve the customer holistically. This strategic positioning is key to us as it helps move towards customer needs fulfillment through a process of achieving high customer satisfaction. This helps in creating predictably, which in turn leads to profitability which further allows for sustainability of an enterprise – which is so key to be able to invest for the customer continuously and also very critical for being able to survive and thrive in challenging times – delivering service and quality standards that are built to last.

The dunia difference...

As the initial team got together and got bigger, the early rules that we set for ourselves must never be forgotten. We are demanding, driven and passionate team. We need to keep this culture live as we grow. It is our commitment to remain true to our customer promise at all times. We are prepared to go the extra mile for our customers whenever required. We constantly seek to learn from our experiences and the changing needs of our customers, and will continue to innovate for their evolving needs in today’s dynamic environment. We will shamelessly serve our customers with the highest level of competence through right training and through listening to their needs, and attempt to passionately deliver in an error-free and timely manner.

As our team grows, we are committed to ensuring that each one of us imbibes these basic values engrained in our credo. Our trainings, our interactions, our recruitment will always be guided by this important principle. It is also our commitment and shared responsibility to continue to build and foster a spirit of teamwork and passion in our people. The principles of meritocracy, diversity and fairness to employees recreate their skills to be better equipped to serve customer and the community will be our custom.

We will invest in right processes, state-of-the-art technology and solutions, to be able to consistently and reliably deliver to our customers, so that they stay ahead. However, at all times, the basics will always be the center of focus – we will maintain the highest standards of business conduct, code of ethics and an overall proactive awareness of risks and actions to be takes. That will make dunia different…. That will position use will to serve our customers differently.

Going forward...

Looking ahead, we are committed to building on values, our capabilities and our people to measure ourselves by the progress we make against our strategic objectives, including the Franchise, Customer, People, Process, and Risk management that are inherent on our business plan.

Our continued focus on society, our community and all other stakeholders through our core business activities, diversity efforts, and volunteerism will drive the way we do business everyday of our lives. We are dedicated to these early values that we set for ourselves and, on behalf of the entire dunia team, I personally commit that we will execute our growth and investment plans in 2009, and also deliver strongly on all aspects laid out for our success by our shareholders, while offering the BEST for our customers and employees.

With my warmest personal regards,

Rajeev Kakar
Managing Director & CEO

 

 

Dear friends and colleagues,

As I write this, I recall last year, when I shared with you how 2008 had been an important year for dunia, as it was the year of our launch. I also recall committing then to executing our growth and investment plans in 2009, and delivering on the balanced scorecard goals as laid out by our stakeholders for our success (despite the challenges of being a new and nascent player born in the midst of macro stress), while offering the BEST for our customers and employees.

2009: Delivering in Challenging Times

2009 was clearly an extraordinary time for businesses around the world, and in the UAE especially it was a year of unbelievable stress, volatility, challenge and change. There was no company or industry or business or economy that was not affected. The degree may have varied, but overall consumer and business confidence, investor sentiment, employee morale, output, employment and investment were at an all time low. The UAE market, with its open economy, took its fair share of this macro stress. Many lost their jobs, businesses closed down, and cost-cutting and intensive restructuring became the mantra.

As dunia was set up to serve the Consumer Mass Market, Consumer Mass Affluent and Small Business segments in the UAE, we were not immune to the effects of the global and local economic downturn. However, our focus on a customer centric model, the quick strategic realignment at the time of launch to the new reality post crises, the absence of legacy customer loans, and the disciplined execution of a highly seasoned and talented management team, enabled us to deliver strongly in 2009 – our first full year of operation.

I am happy to share with you that in fiscal 2009, this discipline enabled us to invest to grow our capabilities, build our brand, create predictability in our ability to source and serve customers, and also remain ahead of our Top-line revenue and Bottom-line profitability targets as per the original investment plan.

This Was Our Moment

Earlier in the year, we had already begun working quickly to realign the business strategy with the changed reality, post the market disruptions. We were guided early by our self-imposed principle of going "back to basics" for our customers and focusing on traditional values that had stood the test of time. We had just launched our business, and we were determined to WIN.

How Did We Protect, Build and Grow?

We were a new brand, faced with the challenge of making itself known to target stakeholders, and we needed skillful realignment to offset downturns which posed significant risks on morale, belief and momentum. So we put a multi-pronged action plan into play:

  • We strengthened our value proposition and reinforced our commitment to maintain and grow the customer experience to attract the BEST customers.
  • We concentrated on upgrading and protecting talent, and focused strongly on valuable contributors, and on enhancing the security and morale of our employees.
  • We focused on enhancing productivity and this is where our early investments in world class technology, processes and systems helped us extract value.

  • We focused as a team to "do more with less".

  • We proactively made strategic changes to mitigate potential risks – by focusing on higher quality sourcing, tighter underwriting standards, value and risk based pricing to attract the better performing customers, and proactively recalibrated our plan to ensure a stronger risk-reward balance.

  • We proactively initiated several spend smart initiatives to ensure a stronger expense focus to be a "low cost provider" and ensure a high operating leverage as we grew.

  • We moved towards building greater loss absorption capacity in the business, by taking "impairment provisions" to insulate the portfolio from its inherent risks and those of the macro environment.

  • Increased focus was put on higher quality sourcing to improve "through the door" population, and by proactive avoidance of exposure to vulnerable or over-leveraged segments.

  • Our prudent credit policy discipline ensured continuous de-risking through careful customer selection, segment/emirate diversification and reduced ticket sizes.

  • We established a strong and ongoing regulatory interface with the UAE Central Bank and received approvals to set up 3 new branches and 15 new service centers. We also received early approval from the Central Bank registering dunia as an "agent" for the Wages Protection System for providing payroll services.

  • We continued to focus on building for the future by enhancing our capabilities, by adding our branches/ service centers (now 19 in number), by increasing our front lines sales force to efficiently serve the customers, by transforming our 24-hour contact center to a full-fledged fulfillment center and not just a service unit, and by increased investment in training and development of our staff to increase efficiency and effectiveness.

  • We reprioritized our initiatives and focused on the critical and high performance ones first.

  • Given the liquidity and funding challenges in the environment, we launched our Customer Deposit proposition early and have built a large, growing base of corporate deposit customers who provide a stable source of funding to us.

  • We launched a diverse product set catering to every customer need – Education Loans, Durable Loans, Business Loans, Corporate Deposits, Diamond/Platinum/Gold/Silver Credit Cards, Loans against Deposits, Financial Guarantees and Special Labour Guarantees through a strategic alliance with the Ministry of Finance.

  • We accelerated focus on secured assets and accelerated our Auto Loan program where we created alliances with a wide network of auto dealers, and provided a range of customized options like New Car Loans, Used Car Loans, Car Cash-in, etc.

Building and Reinforcing Our Ability to Execute the Strategy

Having outlined our strategy, I would like to spend a moment on our ability to execute it. We invested in building a highly talented and seasoned team early with deep and varied expertise in business development, brand building, and financial and credit risk management. Any strategy is only as good as the people implementing the strategy, and I am proud to report that this team has not only demonstrated excellent professional skills but has rendered them extremely well in challenging times, through a combination of focus, energy, passion, execution excellence, innovation and integrity. We have over the last three years, since the founder team initiated work on creating dunia, worked on creating a customer focused proposition that was uniquely differentiated from other players, while ensuring high customer relevance.

Giving Back to the Community and the People

To ensure that our people have the requisite skills to serve clients at the highest level, as well as to advance in their own careers, we invest significantly in their training and professional development. During 2009, a comprehensive training road-map was put in place to allow for targeted learning and skill enhancement of our staff.

We launched the "Kawader dunia" program, as part of which we focused on hiring and training UAE nationals from all levels to take on important positions within the company, and in line with our objective to contribute to the development of national talent. A special alliance was created with a leading business school, the SP Jain Center of Management, for rolling out a unique 4 month training and development program. As part of this program, graduate UAE nationals were hired and provided specific classroom training through trained professors, together with on-the-job training at dunia in the various cross-functional areas of financial services.

As part of "dunia Cares", our Corporate Social Responsibility initiative, we undertook several initiatives during the year, in line with our commitment to work on causes related to "saving the future" through programs aimed at sustainability, environment, health and education for skill enhancement and employability. Noteworthy programs carried out successfully during the year were our "Enriching Lives" program (which was aimed at sharing unused items such as clothing, electronics, books, etc. with low income migrant workers who are in need), 'dunia Speak Easy' (special training programs to help teach English to migrant workers), 'dunia Shoebox Appeal' (which provided basic day to day necessities to migrant workers) and a series of blood donation drives at our office and branches to leverage off our employee and customer base.

External Recognition and Brand Building

All these efforts and our unwavering commitment to our core objectives and values were recognized externally, and during 2009 dunia was awarded a series of awards – including the "Best Use of Technology" at the Banker Middle East Industry Awards 2009 event in Bahrain, the "CEO of the Year for Financial Services" from CEO Middle East, and the "Special CSR Award of the Year" awarded at the Arabian Business Achievement Awards ceremony. This has given us renewed confidence and reaffirmed our commitment to continuously raising the bar, in our QUEST to be the BEST.

2010: The Year Ahead

As we move into 2010, we remain closely focused on our customers and our commitment to go the extra mile for them by adding new value in line with their needs. In parallel, we will continue to add to our capabilities and their execution in a challenging environment to ensure that we remain well-positioned to take advantage of growth opportunities.

I would like to specially thank our entire dunia team and employees for their hard work and dedication during 2009, our board members and shareholders for their ongoing support, and our regulators for their ongoing guidance, which enabled us to successfully manage in a highly challenging and volatile environment.

I am proud of the entire team and of what we achieved collectively in 2009, and even more excited about the tremendous opportunities that lie ahead as we move forward on our path to growth, predictability, scale, profitability and longer term sustainability. We are on our way to becoming a leading market player – as a financial institution, as an employer, and as a responsible corporate citizen. The team is passionate, the drivers are firmly in place, the commitment is strong… And we will work hard to ensure that we achieve the desired results, despite the challenges of the overall environment.

With my warmest personal regards,

Rajeev Kakar
Managing Director & CEO

 

 

Dear friends & colleagues,

While dunia is still a young company having traversed a short journey of less than 3 years since its inception, experientially it seems like a much longer journey that has been through a full business cycle of creation, growth, realignment, challenges, stresses and successes. 2008 was our year of inception. We were new and rearing to make a difference in ways that no other institution had ever hoped to.

Our wholesome dedication and ardor to change the way customers were treated injected a surge of fresh appeal to people in ways that they had never dreamed of. We made our mark and earnestly treated everyone to an unparalleled experience of world-class service, comprehensive solutions, supported reliably by workflow and technology, delivered with excellence and one where the customer always comes first – a truly unique approach which we call the 'dunia difference'.

2009 was our year of creativity, innovation and constant realignment in a rapidly transforming world. We were willing to go the extra mile for our customers, and invest in building capabilities that would allow us to succeed in the future, and to offer them with the highest standards of ethics and integrity. In short, we were willing to go back to basics – which many in the world had forgotten – and to disrupt the status quo to make a real difference in a fragile and fast changing financial services industry. The dictates of the difficult and demanding economic environment made us rethink and realign ourselves to suit the fiscal trends in order to not simply withstand but to also apply ourselves to benefit our customers and clients. The new changing order meant that many institutions had cut back on their exposure, and were unable to serve or were extremely conservative and cautious thus adversely affecting their customers and employees. dunia, and its unique and talented team of professionals, then made a conscious decision to provide “more with less” to combat the stress of the times. We worked even harder and smarter. We innovated, renegotiated, cut costs and worked with greater focus and passion to continue providing the best of services and products to our customers.

2010: The year of consolidation

This year has been a defining year for dunia. In many ways, it has been remarkable for dunia in terms of the growth that we have achieved as a whole, not just for all of us at dunia but also for all the people in association with us. We had just weathered the uncertainties of the previous year and had surfaced intact with great élan. We decided as a team to relentlessly continue in the upkeep of all our promises without compromise, which meant that we had to take stock of our strengths and readjust to excel in our commitments to fulfilling the saving, protection, transaction and borrowing needs of our clientele.

We made a conscious decision to not take for granted our already established state-of-the-art operational platform and resolute infrastructure, and our governance, risk and analytic capabilities, but to continue to build on them to enhance them even further.

We grew in capacity, resource and manpower while continuously expanding our operations and now operate out of 19 financial centers in the three emirates of Abu Dhabi, Dubai and Sharjah, and stand poised to take on even more ahead

Strengthening our pillars and building on our assets

As always, the customer is the core of our focus around which we build all our capabilities, to serve and deliver quality products and services. Our focus on putting in place a consistent and sustainable design ensures that we have the right cogs in place for the continuous flow of daily operations. This helps us not only surpass our financial goals but also increase the shareholder value. A constant review and upgrade of the most critical and integral components of the business; our people, our process and our franchise continues to be a norm, as it was through every quarter of 2010.

How we fortified our core strengths in 2010

  • We built a talented and well-trained team that stands strong at 700+ in count, through the use of stringent selection processes headed by our seasoned senior management and functional specialists who personally ensure that the manpower recruited always falls in line with the principles of the business.
  • We ensured an eclectic mix in terms of gender, nationality and experiences as the standards for recruitment to strengthen our proven model of synergy in diversity.
  • We worked passionately to attract UAE National talent to our team, and built special programs that made working and learning at dunia extremely beneficial, and worked towards contributing to the development and growth of UAE Nationals to develop the long term leadership potential of the company.
  • Partnering with world class institutions enabled us to recruit the best of talent thereby augmenting the already experienced workforce with a wider outlook while honing their latent skills through experience.
  • We further enhanced our state-of-the-art in-house training and development center that encouraged talent and helped the people build on their skills and capabilities along with ensuring coverage of 98% of employees through training, aimed at helping improve both performance and potential of our employees.
  • We continued our focus on building a conducive environment that helps retain talent with regular appraisals and goal setting processes that constantly encourage people to strive harder and aim higher, helping them develop parallel to the growth of the company.
  • We continued to enhance our capacity in line with our growth and the future potential in the marketplace, so as to continue to build on our existing functional capabilities across operations, technology and risk management to enable success.
  • Our ongoing periodic subjecting of our processes, controls and risk management to voluntary and mandatory reviews brought on the necessary assurance around risk management, governance, process controls and business practices, and this comprehensive focus resulted in a 100% compliance with all regulatory requirements in product design, process control and delivery.
  • We continued to build on our customer focus and were voted by a leading publication to be in the top 10 organizations in the UAE for our customer focused service approach. We were judged us amongst other leading players on the service attributes of responsiveness and timely resolution of customer complaints.

  • With the second full year of operations, a range of new innovative products and offerings were introduced to ensure a higher and sustainable revenue base, one example of which is the commencement of our offer of payroll processing services as an approved agent of the Central Bank of UAE to support the important national objective of fi nancial inclusion.

  • We positioned ourselves even stronger as a depository institution offering corporate customers with attractive solutions for their surpluses, while providing value added services through dedicated relationship management, collateralized letters of guarantee, loans and products at preferred terms for their employees, backed by 24-hour access and world class service. Our service focused and value based pricing approach makes us a preferred choice amongst companies for their deposit needs.

  • We worked towards creating strong strategic alliances that released a plethora of innovative products which in turn increased the rate of customer acquisitions by enhancing customer value and relevance.

  • We further intensified our community involvement for the greater good of society through 'dunia Cares', our social initiative. We understand that with consumer choice being increasingly shaped by a company’s reputation and its impact on society, such an approach ensures longer term sustainability, and a healthier acceptance and support from all stakeholders, employees, customers, governments, investors, the media, and the community in general.

In summary, we worked relentlessly to build an even stronger brand, through focus, energy, passion, creativity, innovation, integrity and execution excellence – one that would truly empower people, enable success, and enrich lives.

Our financial strategy and performance in 2010

In 2009 we had a challenging plan in place for 2010, and I am proud to acknowledge that our performance has been well on track and, in some ways, even ahead of what we had planned. We achieved a revenue growth of 132% as compared with 2009. We improved the quality of our revenue by adding new products, diversifying our earnings, and creating new fee opportunities and a granular portfolio mix to avoid any concentration risks.

Our success at growing revenues strongly, while employing a spend-smart approach to expenses, helped us deliver a strongly positive operating leverage of 131% (excluding one-timers) in 2010 as compared to the previous year.

Having launched our business at the inception of the global crisis, our early and timely focus on right customer selection and a strong risk management approach, paid strong dividends, as we were able to successfully bring the cost of credit consistently down to a low level of 15% as compared to the previous financial year 2009, which saw a higher credit loss cost of 26%, in the midst of the global and local crises in the macro-environment.

A combination of this strategy, and its execution, helped us achieve strongly improved profitability where we closed the year better by AED 28 million, versus the prior 2009 financial year.

Our quarter on quarter improvements are even stronger, as our revenues continued to grow with the last quarter of 2010, being ahead on Net Income of the corresponding quarter in 2009 by AED 18 million, ensuring that we have built a strong and more reliable trajectory towards our goal of achieving break-even on Net Income and full profitability in 2011 – the year ahead.

Our future into 2011

We are poised to achieve great things in the year ahead. Our performance has consistently and substantially improved year on year and we are well on the way to our goal to strive towards becoming one of the substantive players in the market. While we aim to work towards ensuring that we deliver in the year 2011, our first year of profitability, we continue in all humility to remain focused on always delivering on our core objectives of serving our customers, adding value to our employees, changing lives, building futures, ensuring smiles and developing human potential in even more ways, just as we have attempted to do consistently since our inception in 2008.

A spirit of dedicated performance, consistent efficiency and diligent hard work has become the norm at dunia and to this effect, I’d like to express my gratitude to the dunia team and the employees for their commitment, hard work and ongoing support at various levels. I am also extremely thankful to all the board members, shareholders, our bankers and the regulators for the guidance, strength and rigorous support and encouragement at all times, as it has constantly spurred us on forward in our journey towards making a difference.

On a personal level, I am extremely excited about moving into 2011. Our growing capabilities and continued performance trends help renew and fortify our confidence in our institutional and collective faculties to take on the challenges and opportunities that the new economy and markets bring forth.

With my warmest personal regards,

Rajeev Kakar
Managing Director & CEO

 

 

Dear friends & colleagues,

I am delighted to send my personal good wishes to congratulate you all on the joyous occasion of our fourth anniversary of our launch of dunia.

The last 4 years have been an amazing journey as we together brought to life, after 21 months of pre-launch hard work and planning, a new financial services brand to the UAE, with an objective to provide world class financial services with a unique customer-centric approach to our clients.

dunia has been perhaps one of the best examples of the power of entrepreneurship which shows how much can be achieved, even in adverse times, by a team through hard work, focus, passion, creativity, innovation, and execution excellence delivered with the highest standards of personal and professional integrity.

Today, on the 4th anniversary, I look back at the day in July 2006, when we first envisioned this journey, and am proud and humbled by all that has been achieved since then.....and how big our team has begun, how well known our brand has become, how predictable our growth trajectory has become, and how many customers we increasingly serve every day of our lives.

We have truly delivered in our original objective of "Empowering people, Enabling success, & Enriching lives". 2012 is another landmark year for us as we are well on our way to delivering our second year of profitable operations, after a record breakeven achievement in 30 months in March 2011, and the first full year of profitability in 2011.

2012 is the year where we are poised to deliver a strong growth, over prior year, in our customer base, in our Revenue, our Net Income, and the year where we surpass our 20% on ROE!!

As we move into the fifth year of our business, we should recognize as a team that we are at an interesting inflexion point of our business which is now poised for the next level of even higher growth, having achieved our initial milestones of building dunia, adding capabilities, attracting talent, increasing brand awareness, stabilizing processes, managing risk predictably, being a low cost provider, creating predictability of earnings, delivering sustained profitability, and delivering key ratios.....while maintaining the highest standards of governance and standards.

We should now collectively refocus our collective energy and talent to leverage off these strengths as we grow the existing business ahead, and also look at newer avenues for growth through newer initiatives, new capability addition, newer alliances, new innovations, etc. The opportunity ahead is even bigger, and we are more confident and capable as a brand and team to realize these inherent opportunities that lie in front of us.

I see the start of the fifth year as the start of a new phase of growth in dunia's journey.....one that will be even more exciting than the one we traversed together, one that will bring new challenges, one that will need us to work with creativity and innovation, as we dare to disrupt the status quo and leverage off new and emerging innovation, and one that leverages off our range of existing strengths.

As we embark on this next exciting phase of the growth, we should never forget our fundamental principles of focusing on the customer and remaining mindful of the basics, while maintaining impeccable standards on process, quality and governance. We must remember to grow with prudence and also never forget to constantly reinvent ourselves in lines with the evolving needs of our customers, and to be prepared to go the extra mile for them.

Finally, we must always focus on our shared responsibility to all our stakeholders, at all times - our customers, our employees, our regulators, the larger community that we do business in, our partners, and our shareholders.

I am excited about the journey ahead, and congratulate you all once again on this wonderful occasion of dunia's 4th anniversary today.....this calls for special celebration!

Please accept my special thanks for all your hard work and contribution along the way, and I am also personally grateful to your families for the support that they provide to you as you work hard in this exciting journey.

I am confident that we will together create even more history ahead.....as dunia blazes ahead!

With my warm personal regards

Rajeev Kakar
Managing Director & CEO

 

 

Dear friends & colleagues,

The year 2012 saw the UAE economy staging a definite and welcome turnaround, despite global economic crisis and uncertainty – tourism boomed, property prices firmed up, trade thrived, corporate incomes increased, and employment grew.

On the back of such macro momentum, dunia further accelerated its success trajectory posting strong gains during the year, reflecting the strength of our business model, which is based on a passionate commitment to serve our valued customers in the best ways possible. Our profits grew during the year by 305% compared to 2011, while our operational base expanded by 28% from what it was during the preceding year. The sustained, and improved profitability resulted in a growth in the dividend payout by dunia to its shareholders.

Our unique customer centric approach, powered by technology and strong processes to ensure reliability and consistency of experience, creates the predictability in the approach that is essential for sustained growth and profitability. The new world of universal 24/7 connectivity, aggressive telecom spread, increased travel opportunities and burgeoning social networking has created a wholly novel set of paradigms to work within. At dunia, we have been proactive and have responded to this new normal by aiming to disrupt the status-quo, through creativity and innovation. It is such creativity that has prepared dunia to be strategically well equipped to respond instantaneously to challenges and opportunities that the market presents from time to time. This unique dunia business model, powered by the collective passion and foresight of the team and the shareholders, which ensures a strong commitment to focus on the customer’s real needs, has helped position dunia strongly to face challenges well, and to realize opportunities.

We, at dunia, stay in a perpetual learning mode in all our varied operations. Success and sustainability to us means transforming our vision, our aspirations, our dreams into reality, driving hard decisions home, continuously correcting our course, shifting gears only to improve our thrust towards further excellence. Each and every member of team dunia demonstrates high levels of energy and enthusiasm, with a strong professional and personal commitment and integrity that is increasingly recognized. We, at dunia, strive to be different, by doing things differently. We are focused towards going the extra mile for our customers and stakeholders.

Our original approach of going “back to basics” has proven itself, as this has uniquely helped us sustain ourselves during the toughest years of the global recession that coincided with our business launch. Our commitment towards attracting and empowering the best talent, enabling them to pursue their dreams with an innovative idea, has helped enrich lives and helped deliver impact. dunia has truly been able to enrich lives of all stakeholders as part of the journey – be it customers, employees, alliance partners, communities, shareholders, regulators, etc. – by setting new standards, and reaching out for greater heights.

The global financial crisis has shown that the biggest risks plaguing the financial world were, and still are, high leverage, high concentration and tight liquidity. To build a strong and resilient business model, we have painstakingly built a business model with excruciating detail that ensures that our business model does not face these risks. During 2012, we managed our top-line and bottom-line growth by ensuring appropriate relative growth to deliver a strongly positive operating leverage, which is so essential to driving efficiency in business. During the year, we grew our equity base smartly and steadily, which has helped deliver a low debt-to equity leverage of approximately 1:1, yet allowing adequately for continued growth ahead in customer assets and earnings in a sustainable manner. In parallel, we focused on a strong risk reward leverage approach to ensure continued momentum on building higher loss-absorption capacity as part of our asset growth momentum, which will help insulate us from any event or tail risk, should it occur. This has also been further reinforced by building a highly diverse and granular portfolio on both the customer assets and deposit ends of the balance sheet, with positively matching tenure durations to mitigate market risks, and in the process, position ourselves favorably for predictable future growth.

2012 Endeavors

We have invested strongly during the year to further enhance our capabilities to prepare ourselves for the bigger challenges, and bigger opportunities, ahead:

  • Our talent pool strength grew to a well-trained team of over 800 employees.

  • The eclectic mix of our workforce – a fine blend of age, nationality, expertise –has grown in synergy and diversity.

  • The hiring of UAE nationals gained momentum through specifically tailored programs to contribute to their development and growth as the long-term leaders of the company.

  • We continued our investment in attracting new high potential talent, through our well recognized Management Associate program, by tying up with leading Universities and Colleges in the region.

  • We enhanced our state-of-the-art in-house training and development capabilities, in line with our commitment to continuously help our employees recreate themselves by building on their skills and capabilities, which is critical to improve both performance and potential of the organization.

  • We continued our focus on building an invigorating environment that helps retain talent with regular appraisals and goal setting processes that constantly encourage our employees to strive harder and aim higher, helping them develop professionally and in sync with rapid business growth.

  • We proactively strengthened capacity in line with our planned growth and the future potential in the marketplace, by continuing to build on our existing functional capabilities across business development, operations, technology infrastructure and risk management.

  • We continued to invest in making dunia accessible anytime / anywhere, with multiple touch-points through our 24x7 contact center, network of 18 financial centers, website, and dedicated relationship managers.

  • We rigorously tested our controls framework through periodic voluntary and mandatory reviews to provide assurance on our risk management, governance, business practices and processes, resulting in 100% compliance with all regulatory requirements in product design, process control and delivery.

  • We continued our focus on spends mart initiatives through outsourcing arrangements, renegotiation with vendors, cost-sharing arrangements, and front-line focused incremental hiring, to deliver an absolute reduction in operating expenses versus prior year.

  • Several new and innovative products and services were introduced to augment the existing suite of transaction, saving, borrowing and protection solutions offered, to ensure a higher, more diversified and sustainable revenue base.

  • dunia positioned itself even stronger as a depository institution with a rapidly growing base of diversified and granular deposits from corporate customers, in line with our strategy to increasingly self-fund business growth through customer sources, while minimizing reliance on professional funding sources.

  • Our reach significantly expanded through new strategic alliances and partnerships with leading players in other sectors, which in turn helped drive product innovation, brand building and increased customer acquisitions by enhancing customer value and relevance.

  • Our community involvement further intensified for the greater good of society through ‘dunia Cares’, our social initiative, bringing together dunia’s employees and customers in a spirit of volunteerism, in rolling-out several campaigns which have had a far reaching and positive impact in the communities we serve.

In summary, we worked relentlessly to build an even stronger brand, through focus, energy, passion, creativity, innovation, integrity, and execution excellence – one that truly empowers people, enables success, and enriches lives.

Corporate Citizenship Initiatives

We strive hard and are passionate about being viewed as responsible Corporate Citizens in the UAE. This approach and aspiration obviously comes with greater responsibility towards ensuring that we weave good practices in all aspects of our business, and in everything that we do. This has led us to recognize the importance of social responsibility initiatives for the betterment of the communities we operate among. We, in dunia, have always adopted and implemented business practices that ensure that we do good as we focus on delivering financial returns. This approach is reflected in the tremendous spirit of volunteerism that permeates the dunia culture in undertaking initiatives to help make a difference and enrich lives, in the communities that we operate in.

At dunia, corporate social responsibility (CSR) is a management theme, a way of living life and empowering people, to make a difference to people and the overall society. Our CSR initiatives reflect our shared responsibility towards the important social themes of health, education, environment, and helping enhance people’s livelihood through improving skills and providing of finance as an enabler.

As part of our commitment to driving Sustainability, in 2012, we focused on “Getting to Green” by engaging our employees in various go-green initiatives like “Message in a bottle” and the “dunia Paperweight Challenge” where employees are encouraged to follow the principles of “Reduce, Reuse and Recycle”. In 2012, we also migrated our customer statements from physical statements to e-statements in order to help conserve the environment, while helping contribute to a wider global impact.

New Challenges, Newer Opportunities

2012 was a year where dunia, despite challenges, developed greater credibility after predictably delivering the second year of profitability in just its fourth year of operation. Our revenue grew strongly by 37% compared with 2011, and we maintained a flat trajectory on operating expenses , as compared to previous year, despite a strong 28% growth in the customer base, as well as an increase in customer loans and advances by 36%, over the prior year. This growth resulted in a strong positive operating leverage of 35% in 2012, with cost-income ratio dropping to 48% compared to 2011. Our strategic focus on right customer selection and a strong risk management approach paid off in bringing down cost of credit to 10.8% vis-a-vis a level of 11.5% in 2011. At the close of 2012, our Net Income grew to AED 73 Mln versus AED 18 Mln in 2011, delivering a strong 305% increase on a year-on-year basis. Quarter-onquarter improvements proved even and helping enhance people’s livelihood through improving skills and providing of finance as an enabler.

We continue to relentlessly strive to further build on our existing track record, through stronger commitment to service and innovation, a continued focus on growing the customer base, while delivering predictably on profitability, which is important for ensuring a sustained ability to invest for growth. Our commitment to helping our customers stay ahead with dunia spurs us to do even more to serve our customers beyond their expectations. At dunia, our focus is on providing competent, error-free and timely service to all our customers. This is the 'dunia difference'.

At this point, I wish to recognize the exemplary commitment, dedication, and hard work of the dunia team that has helped make the dunia promise come true, and remain true at every moment of interaction with customers, partners, bankers, and other stakeholders. I am specially grateful to the Central Bank of UAE, our regulator, for their ongoing support and guidance that is so critical for our sustained growth ahead. We are committed to ensuring the highest standards of compliance and governance at all times. I also specially thank our shareholders and our Board for their ongoing support and guidance, and for their partnership and vision in charting the future course, so that we can continue to move forward in our ambition to become a bigger and more admired financial services company in the UAE.

I am confident that 2013 will hold new surprises and challenges for us. I am also confident that no matter how big a challenge thrown our way, dunia is well-positioned to face these challenges, and realize the new opportunities, by leveraging off the strength of our enhanced capabilities. We focused on building on our objectives of Growth, Service, Innovation, Leadership and Delivering Impact to all our stakeholders.

In 2013, we hope to build further on our strengths, and deliver even stronger as we reach greater heights.

With my best personal regards,

Rajeev Kakar
Managing Director & CEO

 

 

Dear friends & colleagues,

The year 2013 heralded an exciting new chapter for dunia. As the company grew throughout the year, reaching new milestones, so too did the UAE and its economy. Major investments were announced in Dubai and Abu Dhabi to support the building of new infrastructure, from public transport to hospitals, airports and road links. These announcements came against a backdrop of annual GDP growth of 4% coupled with a continued rise in the non-oil sectors of financial services and tourism. These incredibly positive economic indicators demonstrate that the UAE is growing in a sustainable manner, diversifying its economy and gearing up well in advance of Expo 2020 and the economic successes that are set to come. 

Since 2008, the UAE has weathered the global economic crisis better than most. It was during those dark days that dunia was launched - at the very moment that the global financial crisis commenced. Since then, dunia has mirrored the nation's return to solvency, growth and a strong balance sheet. Within three years we broke even and since then have enjoyed YOY double-digit growth. This steady, upward trend is seen in revenues, profit margins and an organically growing customer base. We believe that the true key to building a successful business is one that puts the customer first. From the outset, this belief has served us well. Achieving an increase of 61% on our net income in 2013 came through our commitment to delivering impeccable products and services. Acquiring and retaining customers is our primary motivator and this approach is non-negotiable: deep-rooted personal relationships with each and every customer. Much like the UAE’s unwavering focus on building high value services in its endeavor to achieve a strong and diversified economy, so too has dunia focused on what matters most: “Relentless focus on customers, on dimensions of service, innovation, products, sustainability, and quality of experience.”

The incredibly positive impact of dunia’s customer-centric philosophy and sustainable approach to growth is reflected in a 21% increase in total customer numbers over the course of 2013. The trust that those customers have in dunia as a well-leveraged, trusted financial institution saw customer deposits soar to more than AED 500 million, representing a 24% increase vs. 2012. Trust is our most important asset. For us, it means going back to basics and working in a way that people understand and trust. We have built a strong, resilient business that is well leveraged and supported by strong deposits and customer assets. Total customer assets in 2013 surpassed the AED 1 billion mark for the first time; a rise of 35% on the previous year. This is testament to the commitment that the entire dunia team has to working ethically and honestly: putting our customers’ needs at the very center of everything we do. 

Over the year we have launched a number of new initiatives, products and services that offer unparalleled choice and value to our customers across their various needs – transaction, savings, borrowing and protection. These include the launch of an industry-first credit card, offering customers 3% unlimited cash-back on all spend, loan against property, car fleet financing and many more solutions. Innovation of our products and services is a continuous effort at dunia, while executing with excellence.

Gaining our first standalone credit viability rating of BB- from Fitch is testament to the way in which we do business. Our continuously improving financial performance, prudent management of risk and sound balance sheet are now recognized in a way that should provide customers and other stakeholders with great confidence. Our commitment to sustainable business practices also goes hand-in-hand with delivering better financial returns and value to shareholders over the long term, allowing us to capture new opportunities in the marketplace, backed by a strong and growing capital base. 

In 2013 we continued to work hard towards maintaining a business model that is predictable, profitable, and sustainable. We have achieved this through growing a robust equity base with a low debt-to-equity ratio. This allows not only for a strong balance sheet but also for continued growth in customer assets and earnings. These measures have enabled us to build a stronger loss-absorption capacity, insulating the company and all of its shareholders and customers from risk. This attitude reflects solid, common sense business and – crucially – our commitment to looking after the interests of our customers. Gaining our customers’ trust that their deposits are safe is a central focus and will remain so as we move forward. This strength is underpinned by the continued development of a diverse portfolio of customer assets and deposits, with positively matching tenure durations that help us to mitigate risk and plan for the long term. 

Milestones and Achievements

The successes enjoyed by the company were myriad in 2013, a year that saw us reach 34 consecutive months of top-line growth and profitability. Building a strong, informed and empowered work force has been central to our business strategy. I am personally incredibly passionate about training, development and nurturing talent. It is only through vsourcing and retaining the world’s finest professionals that we have been able to defy market expectations by rising so quickly and sustainably. We continued to challenge the status quo. I am a vocal proponent of doing things differently, for the right reasons. 

Everything we do is focused on delivering a service that is truly and demonstrably different, providing customers with extremely personalized services. Doing things differently and challenging the status quo enables us to deliver greater value to customers and all other stakeholders. 

Highlights in 2013

Financial Goals

At dunia, we rigorously monitor & manage the dunia portfolio to deliver and exceed on key top-line & bottom line targets. We monitor and manage the balance sheet for predictability, profitability & sustainability. 

  • FY 2013 revenues of AED 354 million, up 26% compared to FY 2012
  • FY 2013 net income of AED 118 million, up 61% compared to FY 2012
  • FY 2013 dividend of AED 17.6 million, up 100% on FY 2012, enhancing shareholder value
  • We paid dividends for the third consecutive year and for the first time we paid an interim dividend 
  • Total customer number increased 21%year on year, reaching 138 thousand
  • Customer assets surpassed AED 1 billion for the first time, up 35% year on year
  • Customer deposits crossed AED 500 million, up 24% against prior year 

Franchise Goals

  • dunia was assigned a healthy ViabilityRating of ‘BB-‘ and a standalone Long-term Issuer Default Rating of 'BB-' by Fitch Ratings, on par with most leading local & regional banks, on a similar standalone viability rating basis
  • We continued to deliver on rapid expansion initiatives through deepening existingrelationships, as well as expanding into new customer segments with a strong ethnic focus

Risk Management

At dunia we believe in strengthening operational risk management capabilities to support business growth and mitigate risk. We also focus on ensuring robust liquidity management to ensure sustainability & optimal shareholder return. It is this disciplined approach that has allowed us to predictably and sustainably deliver healthy RAY of 27.8%, ROE of 28.9%, and loss absorption capacity of 2.4x, while ensuring low levels of “liquidity risk, concentration risk, and leverage risk”. 

Process Control and Governance

  • We ensure optimal deployment of IT capabilities & architecture in line with business needs, new capabilities & evolving technology
  • We focus on delivering service excellence in turn leading to customer delight
  • We endeavor to maintain a robust controlenvironment at all times

People

  • It is my belief that our consistently reliable and strong performance at dunia is based on the strength of a focused, passionate and energetic team
  • We built a strong talent pool and continue to leverage skills & knowledge base for business excellence & sustainability and who have the ability to create and innovate, and then execute ideas with excellence to achieve results – with high standards of performance and personal integrity. We therefore invest strongly in attracting good people, and then engaging them to deliver, training them to perform stronger while developing them to enhance their potential
  • Our talent pool grew to a well-trained team of over 900 employees
  • The company’s diverse workforce is now made up of professionals from 31 nations around the world
  • Of those who have been with dunia since its inception, more than 70% have been sent on external leadership training development programs
  • As part of our commitment to building a strong Emirati workforce, we focused even more on campus engagements to recruit the best and added new senior and seasoned Emirati talent to fuel our future ambitions
  • Our Management Associate program led to the hiring of several new employees
  • Reflecting our commitment to providing real-time responses to each and every single customer enquiry, we invested heavily in our call centre capabilities in 2013, which grew by 11% employees
  • Our Talent Management Program is designed to keep developing and growing our talent for higher responsibilities and accountability through job rotation, stretch assignments, team challenges, continuous mentoring, overseas assignments and nomination to leadership development programs offered by leading universities

Strategic Initiatives

  • We focused even more on institutionalization of dunia through enhancement in policyframework, governance standards and overall holding structure and receiving an external credit rating
  • Our internal enterprise technologies were upgraded, further streamlining our customer engagement processes and adding value to the customer experience 
  • We are amongst the first in the UAE to introduce chip and pin technology in our card system, to offer greater customer safety and protection, and to increase and enhance our payment services technology capabilities
  • The use of Strategic Analytics has always been a central part of the customer-centric approach. In 2013 the company increased its use of ‘big data’ .This move allows us to develop new products and services that are relevant 

Recognition

  • We were issued with a viability rating of BB- and a standalone long-term issuer default rating of BB- by Fitch Rating, testament to our policies of strong governance, risk management, regulatory compliance and the company’s consistently strong financial performance
  • In 2013 we continued to build relationships with partners and other key financial services players in order to push forward an agenda of consumer protection and setting standards
  • We were recognized by the new Etihad Credit Bureau as one of the nation’s top 30 financial institutions
  • In 2013 we have been awarded one of the strongest satisfaction ratings from external regulatory audits
  • Recognized as one of the top 100 emerging global companies by top tier consultants
  • Recognized as being 4th in UAE for outstanding service by Gulf News Service Honor Roll
  • dunia’s Annual Report for FY 2012 was awarded a Platinum Award by LACP
  • dunia’s Annual Report for FY 2012 was recognized amongst Mubadala entities for its transparency and comprehensiveness
  • dunia was recognized yet again through a second case study written by Singapore Management University on our unique credit approach

Aspiring to Greater Heights

We are mindful of the fact that the market place is becoming more competitive and as the global economy continues to correct itself and liquidity improves, there will be a greater demand for capital which will need to be sourced from a range of investors and geographies. This challenge is, however, welcomed. We know that the only way to respond to a changing climate is to continue to innovate, and invest. and to be - naturally selected - as a recipient of such capital by becoming the most attractive value creating opportunity to invest in. 

Innovation comes through personal empowerment and that means investing even more not only in our products, systems, and processes, but also in training, mentoring and nurturing all employees. We are absolutely committed to investing in our people as we move ahead as talent is the key differentiator.

Growing Sustainability

The best run companies are those that embrace the ‘triple bottom line’. This measures not only profits but also the impact that our activities have on people and the planet. The basis for this belief is straightforward: every company has a responsibility not only to its shareholders and employees but also to people and the planet. 

PEOPLE: Every operational decision taken at dunia is assessed against the impact that it may have on the people the company and its actions touch upon: our staff, our shareholders and the wider community.

PROFIT: Profitability enables all business to grow and create jobs, which is a major benefit to society. Profitable organizations may also be less likely to cut corners and we believe that by being profitable we are able to invest in systems and processes that protect the business, protect jobs and safeguard the people and planet around us.

PLANET: We have implemented many green initiatives to help protect the environment. These include reducing our own ecological footprint trough compact branches, recycling, automation, waste reduction and the active promotion of energy saving tactics such as energy-efficient lighting. In our world of limited resources, we have a responsibility to use them judiciously, while ensuring we replenish for the future. 

Reaching New Summits in 2014

Five years is often considered to be a milestone for new companies. Our performance throughout this period – from inception to profitability and beyond – has been consistently strong one that has set records, which has been recognized inherently.

We have a strong, robust balance sheet and a growing customer base. We have excellent governance policies benchmarked against global standards. We are confident that dunia is fundamentally strong, providing us with an enviable platform for growth and investment. 

We are now at a point in our growth where we are able to leverage our capabilities to take us to the next level of performance. As we look ahead, we will focus on even more growth through scale and scope, and also through constant reinvention and enhancement of our core by transforming and enhancing our capabilities. Our business is rapidly growing by every measure, most notably (and most importantly) our customer base. 

Reaching the Stratosphere

I am incredibly pleased with our progress so far: 2013 was a major milestone. I am, however, even more excited as we look ahead. I know that we are in a rare position: well leveraged, well run and staffed with some of the world’s most talented professionals. I am fully confident that 2014 will present us with many successes. New initiatives, products and services are well under way and I believe that 2014 will see us surpass expectations, rise above what has come before us and soar to even greater heights. 

I wish to especially thank all our stakeholders who have partnered and supported us in this incredible journey thus far and as we continue setting new highs in the future. My personal special thanks to the Central Bank of the UAE as our regulators, our alliance partners, our service providers, our bankers, our shareholders, board members, our employees and their family members. 

 

With my best personal regards,

Rajeev Kakar
Managing Director & CEO

Dear friends & colleagues,

We live in interesting times, and the year 2014 witnessed several developments that affected business and the macroeconomic environment in which we operate. Since the start of the year, economic growth across the UAE and the region as a whole was characterized by volatile global markets and oil prices falling, all of which measured uncertainty.

In the face of such headwinds, we are proud that 2014 was a remarkable year for dunia. Our carefully designed business model since inception has been designed to handle stress well and realize opportunities when they occur. This has provided us with the ability to deliver with an admirable resilience to global and regional challenges. We continue to flourish as a result, supported by the robust economy of the UAE, its leaders and welcoming community, and have witnessed another strong year of growth and momentum. Our profits grew during the year by 61% compared to 2013, which is yet another affirmation of our strong business model, driven by our ethos of customer centric and customer focused effort, while being true to our commitment to doing things differently. Our sustained commitment to this approach led to improved profitability resulting in our ability to announce a momentous increase of 309% in dividend payout to our shareholders.

Our unique customer centric approach, powered by technology and strong processes to ensure reliability and consistency of experience, creates the predictability that is essential for sustained growth and profitability. The new world of universal 24/7 connectivity and burgeoning social networks has created a novel set of paradigms to work within. At dunia, we are proactive and continuously respond to the evolving new normal by aiming to continuously disrupt the status-quo. Through creativity and innovation, we strive to help our customers stay ahead. Our distinctive approach to new challenges and opportunities presented by the market and to the ever-evolving needs of customers has equipped dunia to respond instantaneously to every opportunity.

This unique dunia business model, powered by the collective passion and vision of the team and the shareholders, ensures a strong commitment to focus on the customers’ real needs and has helped position dunia strongly to overcome challenges while realizing opportunities.

Ever since our launch in 2008, dunia’s Five Point Plan, has guided our approach and continues to help us forge on in the right direction, define customer delight, surpass customer expectations, and introduce industry-leading products and services, while maintaining our constant commitment to excellence. Our relentless focus on our “customers”, on our “employees”, on “innovation”, on “teamwork” and on “execution excellence” helps us deliver a reliable, consistent, unique and positive customer experience at every stage.

Our unique focus on innovation continues to offer distinctive services that adds tangible value to our customers, in line with our commitment to always place the customer first. The world is rapidly changing and the way we communicate with each other is constantly evolving. In today’s world, flexibility and adaptability not only help acquiring and sustaining customers, but also help in responding with dexterity while anticipating changes. This uniquely positions us to be able to respond to the evolving landscape with agility. This relentless focus on placing customers at the heart of all we do, has resulted in our customer base increasing every year. In 2014, our customer base increased by 19% over 2013. Over the year we have launched a number of new initiatives, products and services that offer unparalleled choice and value to our customers across their various needs – transaction, savings, borrowing and protection.

In 2014, we continued to work on maintaining a business model that is predictable, profitable, and sustainable. We have achieved this through growing our equity base steadily with a low debt-to-equity ratio, yet allowing adequately for continued growth ahead in customer assets and earnings in a sustainable manner. While doing so, we continued to focus on our risk-reward leverage approach to ensure continued momentum in building a stronger loss-absorption capacity, helping insulate us from all risks. This was further reinforced by building a highly diverse and granular portfolio on both customer assets and deposits, with positively matching tenure durations to mitigate market risks, while supporting predictable future growth.

2014 was also a year of recognition and growth for dunia. We received plaudits from world-renowned academic institutions including The University of Virginia’s Darden School of Business and the Singapore Management University (SMU). Our unique business model is now being taught and debated in classrooms around the world.

2014 Highlights

Financials

At dunia, we rigorously monitor & manage our portfolio to deliver and exceed on key top-line and bottom line targets. We monitor and manage our balance sheet for predictability, profitability and sustainability.

  • FY 2014 revenues of AED 506.7 million, up 43.2% compared to FY 2013
  • FY 2014 net income of AED 191.3 million, up 61.5% compared to FY 2013
  • AED 72 million (AED 131 per share) dividend paid for 2014 (fourth year of dividend track record)
  • 19.5% y-o-y growth in customer base, to 164.6k customers
  • 46.8% y-o-y growth in net loans and advances to customers, to AED 1,504.8 million
  • Customer deposits of AED 828.7 million, up 60.9% compared to FY 2013

Franchise

  • Fitch Ratings reaffirmed dunia’s Long-Term Issuer Default Rating (IDR) of ‘BB-‘ on a stand alone basis. This viability rating is on par with the corresponding rating of most leading local and regional banks on a similar stand alone viability rating basis.

  • We continued to expand rapidly through new strategic initiatives that focused on deepening existing relationships. This has resulted in excellent traction in our new customer segments with a strong ethnic focus.

Risk Management

This year, we strengthened our operational risk management capabilities further to support business growth and mitigate risk. We also focus on ensuring robust liquidity management to ensure sustainability and optimal shareholder return. This disciplined approach allows us to predictably and sustainably deliver healthy RAY of 27.1%, ROE of 35.6%, and Loss Absorption Capacity of 2.2x, while ensuring low levels of risk on the dimensions of liquidity, concentration and leverage risk.

People

I strongly believe that dunia’s employees and talent are our true differentiator. I also believe that continuous education, training and development of talent is the best way to empower people, enable their success and in turn enrich the lives of individuals, employees and other stakeholders of society. Our consistently reliable performance is based on the strength of our talented, passionate and energized team.

  • We continuously build a strong talent pool by investing in attracting the best and the brightest and then engage and challenge them to continuously deliver, while training them to excel and develop them to enhance their potential.

  • We expanded our team size exponentially by hiring specialized staff in various functions and now have over 1100 employees across the country.

  • As part of our commitment to build a strong UAE National workforce and serve the nation, we focused strongly on campus engagements to recruit the best and added new senior and seasoned UAE National talent to strengthen our team. Several UAE Nationals have been nominated for MBA programs at leading universities.

  • Our Dunia Associate Program intake grew significantly in 2014, as we hired ten new graduates from distinguished business schools such as the Indian Institute of Management at Ahmedabad and Calcutta, Singapore Management University (SMU), Higher Colleges of Technology in UAE, INSEAD and SP Jain School of Global Management.

  • Over 40 high potential employees were nominated for advanced management and accelerated development programs at the prestigious University of Chicago’s Booth School of Business campuses at London and Singapore, and for the Oxford Said Business School - Chicago Booth program. dunia focuses on talent building not just at the time of recruitment but also focuses on constantly refreshing seasoned employees through nominations to accelerated development programs at leading universities.

  • As part of our continued commitment to building university relationships so that we can continue to be the employer of choice while competing with other top-tier global recruiters, we launched a unique scholarship program for students of the Post Graduate Programme (PGP) in Management at the prestigious Indian Institute of Management in Ahmedabad. We intend to broaden our university relationships by offering these scholarships at other leading universities as well.

  • For employees who wish to take on specialist roles at dunia in the areas of operations, risk and sales, we have developed customized unique programs. DOORS Program (Development Opportunity for Operations, Risk and Sales), dunia’s proprietary career advancement program for front-end staff in the functions of operations, risk and sales, opened its doors to the public and to our employees in 2014. Several such employees have been given more challenging assignments within critical functions in the company to develop and grow them as long-term leaders of the company.

Strategic Initiatives

  • One of the most important initiatives this year was to ensure that dunia goes digital. We defined our digital strategy as part of our 3M dunia digital framework which revolves around the three critical factors – Mobility, M-Commerce and Managed Cloud Services, aimed at imparting a comprehensive and seamless experience to the customer, based on the pillars of flexibility, convenience and the benefit of making transactions anytime, anywhere.

  • We focused on enhancements in existing policy frameworks, governance standards and overall holding structure.

  • Our internal enterprise technologies were upgraded, further streamlining our customer engagement processes and adding value to the customer experience.

  • We integrated with the Al Etihad Credit Bureau in 2014, and its implementation across all dunia products, which will serve to increase credit quality further, manage risk better and reward customers in a structured manner.

  • We implemented the Chip and PIN technology ahead of time on all our card products, and were fully compliant with the UAE Central Bank’s guidelines by the end of the year.

  • Our distribution and reach significantly expanded through new strategic alliances and partnerships with leading players in other sectors, which in turn helped drive product innovation, brand building and increased customer acquisitions by enhancing customer value and relevance.

Evolution Through the Customer Journey

Our business has always been firmly centered around our customer, and this intrinsic focus helps us look ahead from a different perspective – that of the customer. From delivering a customer WOW, we have evolved to a stage where delivering customer delight is fast becoming the norm. In 2014, we launched ‘dunia Magic Moments’, which is an initiative that aims to surprise our customers and rewards them at their moments of truth.

We continuously invest in new age technology led initiatives in the areas of Social, Digital, Mobile, Cloud and Big Data to transform ourselves into a provider of cutting-edge solutions that address our customers’ holistic needs through the use of latest technologies. In 2014, we launched dunia Qwik Cash, a mobile platform which has transformed our customers’ mobile phones into digital payments and fulfillment channels which empower the customer with the convenience, flexibility and transactional power to transfer money anywhere, anytime through a simple text message.

Recognition

  • Financial Times Press recognized dunia for its Analytics prowress by featuring dunia’s distinctive marketing analytics model in the Financial Times Press book ‘Cutting Edge Marketing Analytics’ authored by professors at the University of Virginia’s Darden School of Business.

  • In 2014, we were also audited by regulators and awarded an exceptionally sound and satisfactory rating.

  • We have also been recognized as one of the top 100 emerging global companies by top tier global consultants.

  • Gulf News has consistently featured us in the top 10 list of ‘Top notch companies providing outstanding service’.

  • We were awarded ‘Excellence in Financial Reporting’ at the 2014 Institute of Chartered Accountants in England and Wales (ICAEW) Middle East Accountancy and Finance Excellence Awards.

  • dunia was recognized for ‘Excellence in Sustainability’ at the IAIR Awards.

  • dunia’s Annual Report for FY 2013 was awarded a Gold Award, and our Sustainability Report was awarded a Silver Award by League of American Communication Professionals.

Expanding Sustainably

In today’s world where sustainability is increasingly a theme, it is important for well run companies to embrace the ‘triple bottom line’, which not only measures profits but also the impact that its activities have on people and the planet. At dunia, we subscribe to this belief and sustainability is at the heart of our culture. This drives our financial and operational endeavors, influences strategic decision making, employee recruitment and retention policies.

Looking Ahead

As we cross our sixth year of business, while much has been achieved, we feel like the journey has only just begun. This belief leads us to relentlessly strive to further build on our existing capabilities while leveraging off our track record, and our constant commitment to service and innovation. Our focus remains on growing our customer base, while delivering top-tier value to them in order to ensure that we deliver predictably on profitability, which is important for our ability to sustain innovation, to invest by providing added services to our clients and be prepared for unplanned risks in the future.

I wish to recognize the exemplary commitment, dedication, and hard work of the dunia team that has helped make the dunia promise come true, and remain true at every moment of interaction with customers, partners, bankers, and other stakeholders. I wish to especially thank all our stakeholders who have partnered and supported us in this incredible journey thus far and as we continue setting new highs in the future. My personal special thanks to the Central Bank of the UAE as our regulators, our alliance partners, our service providers, our bankers, our shareholders, board members, our employees and their family members.

With my best personal regards,

Rajeev Kakar
Managing Director & CEO

Dear friends & colleagues,

2015 was an extremely uncertain and volatile year for the world and driven primarily by a number of factors which included the uncertainty about the US Federal rate increase, the drop in commodity and oil prices, the slowdown in China and emerging markets and the regional middle east turmoil, together with a highly vulnerable Europe, which is plagued by problems related to sovereign debt, security, refugees and problems of BREXIT which have been dominating the theme. All this in an environment where global banking has been heavily constrained because of the lack of capital and lending being under pressure. In such an environment, there tends to be uncertainty and markets tend to be volatile, investment confidence comes down, participation in employment comes down, consumption drops and businesses face pressure.

At dunia, we too faced the headwinds that were caused by such volatile conditions in the world but given the fact that we, at dunia, since inception have learned to weather headwinds, we have over time built a model that is highly robust and capable of responding to such situations. For us, it was an opportunity to prove the robustness and sustainability of our model which had been designed such that it can allow us to invest in good times and be able to absorb shocks in bad times. In an extremely challenging macroeconomic environment where many people lost jobs and business flows reduced, it was possible for dunia to widen operating margins, absorb some of the shocks in the external markets and yet be able to deliver strongly.

As a company that was designed to be an insurgent, we have tried to shape our destiny in order to realise our potential by preparing for the fact that there would always be adverse trends that we would have to face and we created the necessary buffers as well as the absorption capabilities to absorb those and yet be able to invest. Some of the key capabilities that we invested in include the power of the intangibles – where we have good governance and processes, but more importantly, we staffed ourselves with some very high quality, passionate people who are determined to be creative and have the ability to disrupt the status quo whenever there are vulnerabilities. We have not built an environment where we can’t fail, but where it is safe to fail.

At this point of time, it is the grit of our people, the versatility of our business model, and the efficiency of our operations that allowed us to be able to continue to deliver. We are happy to report that been able to stay true to our belief that we should empower people, enable success and enrich lives. It was this result that guided us through the year.

Reaching new heights

In a year of volatility and challenges, we achieved new milestones. We saw another strong and sustainable financial performance in particular, with organic growth at both the top and bottom lines, and a significant increase in customers.

FY 2015 revenues of AED 723.2 million, up 42.7% compared to FY 2014

  • FY 2015 net income of AED 217.4 million, up 13.6% compared to FY 2014
  • AED 142.0 million dividend paid for 2015 (fifth year of dividend track record)
  • 28.0% y-o-y growth in customer base, to 210.7k customers
  • 33.7% y-o-y growth in net loans and advances to customers, to AED 2,012.1 million
  • Customer deposits of AED 1,176.1 million, up 41.9% compared to FY 2014

Despite the challenges of the market, the robustness of our model got proven when we were able to reach new heights.

Driving growth through investment

All this has happened because of our focus and investment on people, processes, infrastructure, products, creativity and innovation all along. This year too, we continued to show the same focus with our ongoing product development, which in turn drove a very efficient cross sell mechanism.

We invested in more analytics capabilities and technology through which we were able to secure even better quality data, which was used to better decode our customer’s needs and offer them seamless service. This helped us retain high customer satisfaction levels and reinforced the dunia brand as a genuine enabler for people’s needs. At the same time, we invested in new strategic risk management methods, allowing dunia to maintain a predictable and sustainable growth trajectory.

Long term credit rating upgrade

It is important when we do business that we build a strong sense of credibility and that is when credible third party endorsements matter. As testament to our robust business model, dunia’s Long Term Issuer Default Rating (IDR) was upgraded to BB from BB- by the international ratings agency, Fitch. . It stated that the key drivers behind dunia’s ratings uplift reflect the company’s improved funding profile, diversification of existing bank lines, growing franchise, and additional year of track record.

Committed to developing talent

Talent is our biggest asset and since inception we have been highly committed to having the best people work with us, people who are highly focused, energetic, passionate, creative, innovative, strong on execution excellence and very high on integrity. For this, we constantly hire the best, train our people as they work with to nurture them and enhance their potential on a continuous basis.

In 2015, these efforts continued and our brand continued to grow, making us the employer of choice and as a result we continued to source a lot of talent from leading schools across the world. This year, we hired talent from leading schools including the Indian Institute of Management Ahmedabad, Indian Statistical Institute (ISI), Singapore Management University (SMU), Yale, MIT Sloan School of Management, Great Lakes Institute of Management, Higher Colleges of Technology in UAE, INSEAD and SP Jain School of Global Management.

Delivering a greater digital experience

With the advent and greater penetration of Social Media, Analytics, Cloud and Mobility solutions and the increasing ownership of smart devices and the availability of data, we too at dunia, realize the power of digital technologies and data. With the interconnectivity of devices and availability of far more information, customers are aware of products and services and are able to access them on-the- go.

In 2014, embarked on a journey to strengthen our capabilities in the areas of Social Media, Analytics, Cloud and Mobility. We strengthened the ‘duniaQwik’ brand with a host of new services in addition to our successful duniaQwikCash offering which gave customers the power to make payments and transfer money with the touch of a button.

We further enabled our customers to transact anytime, from anywhere, by empowering them through the ‘dunia Mobile’ app, which brought more convenience to their fingertips.

Strategic risk management

Strategic risk management continues to be our focus. At dunia, we have always been a risk-reward leveraged company where we always balance risk and reward in our decision making. We have never mis-priced capital or risk. As a result, while there was uncertainty about when there would be a crisis, we have designed our business to make sure that such risks are priced in over the lifetime of the assets.

We welcomed the launch of the Al Etihad Credit Bureau in the UAE, we were immediate users of the Credit Bureau and the fastest to be 100% compliant. Since then we have not only used the bureau extensively in our data-driven decision making process, but we continue to use it for credit, revenue, marketing and cross-sell purposes as it allows us to understand and fulfil our customer needs in a straight through manner.

Strategic cost management

With such synergies and investment that is a combination of digital and straight through decisions with the support of the bureau, we have been able to drive greater service levels to customers and also greater efficiencies in our expenses. This has been reflected in our cost to income ratios falling 12.4% in 2015 compared to 2014. It is this drop in expenses, in a strategic manner that allowed us to widen our operating margin, while maintaining our revenue yields. This strategic cost management focus has allowed us absorb some of the shocks and yet deliver strongly on the bottom line.

Committed to sustainability

We believe that our business must be measurable, predictable and profitable in order to be sustainable. We use our sustainable profitability to be able to invest in stronger tangible and intangible assets, grow the power of the company and at the same time, be able to absorb shock.

In line with our belief in doing good while doing good business, we remain committed towards giving back to society. We believe that just as we have shaped our own destiny, we should give back to the larger ecosystem that we live in, making it sustainable for an inclusive growth.

As part of our sustainability initiatives our corporate social responsibility efforts were focused on shaping change at the grassroots level. Our dunia Cares platform once provided the momentum for the vast majority of our activities in this area and during the year we delivered a number of important initiatives, including the Dunia Young Business Leaders Program, Dunia Young Leaders Scholarship Program, Dunia Emirati Leaders Scholarship Program, as well as Blood donation drives and social welfare initiatives. We were able to empower people through these initiatives, enrich their lives and enable their success.

A reputation for quality

dunia’s commitment to quality and excellence in everything we do has been recognized over the last seven years with a number of respected awards and acknowledgements. 2015 saw the addition of several more, including:

  • dunia Annual Report 2014 won Gold Award from the League of American Communications Professionals (LACP)
  • Global Reporting Initiative (GRI) registered the dunia Sustainability Report 2014 to be in line with GRI G4 standards
  • dunia Annual Report 2014 received the Silver Award from Annual Report Competition Awards International (ARC)
  • dunia Sustainability Report 2014 won the Bronze Award in the Annual Mercomm International Galaxy Awards
  • Entrepreneur Middle East recognized us in the ‘Finance Innovation‘ category
  • The Forbes Middle East recognized us in The Top 50 Business Leaders in the Arab World, ranked 15
  • The Indian Institute of Management – Ahmedabad (IIMA) published a case study about dunia’s journey of building the dunia brand and providing a unique customer experience through innovative marketing communication and advertising strategies

Looking ahead towards our destiny

While we look ahead into 2016 and expect it to be a period of volatility and uncertainty which is the hallmark of the times, our performance in 2015 gives us more confidence that we are well prepared and well-armed to be able to handle these challenges. While we certainly cannot claim that we will not be impacted by the ecosystem, we certainly do expect that we will be less impacted and will be faster in being able to realise the opportunities that the market presents. We will continue to focus on our customers, be efficient in our operations, embrace change, drive innovation and focus on servicing our customers even better. For this, we will continue to motivate our people, expand workforce and bring talent into the company. This combination of assets is what we are sure will help us contribute to the market and the UAE and help shape the lives and destinies of people. This is the power of dunia.With my

With my best personal regards,

Rajeev Kakar
Managing Director & CEO

Dear friends & colleagues,

2016 continued to remain a challenging year with the global markets witnessing slow growth owing to macro-economic stress driven by political uncertainty, reduction in commodity and oil prices and an overall decrease in confidence in the global banking environment. Despite these volatilities which led to an environment characterized by lower confidence, reduced employment, lower consumption and increased pressure on businesses, dunia’s performance, just like that of the UAE, has been resilient.

At dunia, we did expect to face pressure as a backlash of monetary stimulus around the world and the tense market sentiments, as a result of which we were able to adequately prepare ourselves to deliver yet another resilient performance. Resilience has been built into the design of dunia right from inception and the result of this is consistent performance over the last nine years during both good times and challenging times. With the right design, at dunia, we have built a business where our investment during good times has helped us absorb shocks in tough times and yet deliver predictable, profitable and sustainable results.

While we have equipped ourselves by widening operating margins, ensuring conservative provisioning and the right financial planning, it is the power of our investment in intangibles that has really enabled us to be resilient during challenging times.

Touching lives of customers with empathy

We understand that the market forces not only impact businesses but also the lives of all our customers. During these times when even businesses are under pressure to achieve results and tend to cut back on services, at dunia we believe that it is the time to invest in our customers and increase service levels. True to our core value of being customer centric, we pride ourselves in never diluting these standards during stress. Over the year, we have increased our service levels, communication channels and ensured that we are in constant touch with our customers, to guide them every step of the way through their challenges. In line with this approach, we proactively identify areas where we can make the lives of our customers easier to better equip them to face challenges in stressful situations. One such initiative is the debt counselling session where we invited dunia customers and customers of any bank to walk into our offices to meet with specialists who guided customers to ease their monthly payments. This personal, human touch is the dunia difference.

Driving performance through investment

Social media, mobility, analytics and big data have also been key drivers of dunia’s customer centric approach. In 2016, we continued to invest heavily in our technology and analytics capabilities. With the Al Etihad Credit Bureau being in existence for over two years, we further enhanced our data analytics capabilities by leveraging data available in the credit bureau in addition to demographic, usage and behavioural data of customers using our proprietary big data and analytical models. This helped us uniquely identify and differentiate customers who were well intentioned but temporarily unable to service their debts and provide personalized service and customized solutions to help them manage their finances better. This enabled us to stay closer to our customers, to help them in the best way possible. With this approach, we at dunia, were also better equipped to prudently provision for losses and were able to create resilience to absorb shocks in the external environment.

Through our digitization efforts, we have enabled customers to leverage our mobile platforms to get instant access to information and benefit from better service. Customers can transact anytime, anywhere through dunia’s range of mobile apps and even receive support to grow their business through some of dunia’s other digital platforms. Digitization has not only enabled us to acquire and engage with customers in a personalized manner, but has also helped us bring down our cost of doing business, which is evident in our Cost/Income ratios reducing significantly.

We have remained ahead of the market through initiatives that are relevant to customers and designed in a manner such that we transform from the core, thereby, increasing the likelihood of success and adoption by customers. For this purpose, we have leveraged new evolving technologies under areas of Social Media, Mobility, Big Data, Analytics and Cloud that are in line with current customer awareness and adoption of these solutions, while ensuring that our business model remains robust despite rapid growth and transformation. All these initiatives have been backed by the highest standards of governance and assurance, to ensure that customers have peace of mind knowing that they are always ahead with dunia while also benefiting from their concerns on confidentiality and security being addressed.

Resilient financial performance through prudent planning

dunia recorded a strong financial performance in 2016 which is testament to a business model that is designed to deliver results that are predictable, profitable and sustainable. With prudent loss recognition and impairment reserves we have grown positively and declared dividends in a challenging year.

  • 11.6% y-o-y growth in revenue, to AED 806.8 million
  • Sixth year of profitability, with net income of AED 71.3 million
  • AED 42.0 million dividend paid for 2016 (sixth year of dividend track record)
  • 20.9% y-o-y growth in customer base, to 254.7k customers
  • 7.2% y-o-y growth in customer deposits, to AED 1.3 billion
  • Cost-income ratio further reduced to 13.8% (resulting in 56.0% positive Operating Leverage)

Strategic risk management

The period between 2010 and 2015 saw massive monetary stimulus globally, which led to the availability of increased low-cost liquidity and funding. We, at dunia, as part of our strategic risk management focus ensured that, despite the availability of excess liquidity, we ensured that we maintained strong internal discipline of rightly pricing both risk and capital. With this approach, we designed our business in a manner where risks are priced in over the lifetime of the assets, providing us a healthy cushion against the crises, both in the form of increased long term liquidity as well as wider operating margins to absorb the higher provisions required for the stress conditions.

Being the first users of the Al Etihad Credit Bureau, with 100% penetration of our customer base, in 2016, we further invested in developing new scorecard based approaches to leverage the available bureau data to make better quality decisions based on data. We extensively use data in the decision making process, in the areas of credit, revenue, marketing and cross-sell purposes as it allows us to understand and fulfill our customer needs in a straight through manner.

Strategic cost management

dunia’s approach to managing costs is strategic in that, we manage cost by investing in people, process, technology and external resources such as the credit bureau which help us manage costs by intelligently increasing revenue and response while reducing risk. Through our investments in technology, analytics and digitization, we have been able to drive greater service levels through straight through processing and also greater efficiencies in our expenses. This is reflected in our cost to income ratios reducing to 13.8% in 2016. This strategic cost management focus has allowed us to absorb some of the shocks and yet deliver strongly.

Robust business model validated by credible third parties

As a testament to our robust business model, international rating agency, Fitch, affirmed dunia’s Long Term Issuer Default Rating (IDR) at ‘BB’ after upgrading dunia’s credit rating from ‘BB-‘ to ‘BB’ in 2015. dunia’s short-term IDR was affirmed at ‘B’, while its long-term IDR outlook was confirmed as stable.

Building dunia’s Human Capital

In an environment that has witnessed downsizing of staff and reduced employment across sectors, we in dunia have been different. We have used this period to invest in building our human capital as we believe that it is our team of bright, knowledgeable and talented people that positions us to better manage challenges and realize associated opportunities that typically appear in stress situations. With our continued focus on building our talent pool, we have deeply increased our quality of staff who are focused, passionate, energetic, drive execution excellence and work with integrity. With these qualities, there is a true sense of ownership and commitment to deliver business results even when there is a stress in the market. Our approach to investing in people even during challenging times has paid off in that, our people go the extra mile to drive our business results with ownership. Aptly supporting this, is a carefully instituted culture where our people have the freedom to be innovative and disrupt the status quo for positive change in an environment where it is it safe to fail.

We focus on creating a culture where people are given all resources to succeed. Our people are trained and encouraged to build skills and improve their performance continuously, given accountability early and stretched by exposure to complexity, so that they are developed to raise their potential. It is through this focus on improving performance and raising potential continuously that we build true Human Capital that have the skills and knowledge to create value that people and our customers are willing to pay for. It is this continuous approach of ‘empowering people, to enable their success, so that they enrich their lives and that of other stakeholders’, that has helped make the dunia difference where our people are our true ‘Human Capital’ and not just ‘Human Resources’.

Growing the community as we grow

We believe that we have a responsibility to the community around us and we have a deep desire to positively impact the lives around us, be it customers, youth or the community at large. At dunia, we also understand that for us to grow, it is important to also enable the community around us to grow and this understanding is what drives every action of ours. Some of our key initiatives under this objective are targeted at shaping young minds, empowering through education and spreading knowledge in the community. Our dunia Cares platform provides the momentum for the vast majority of our activities in this area. During the year we delivered a number of important initiatives, including the Dunia Young Business Leaders Program, Dunia Young Leaders Scholarship Program, Dunia Emirati Leaders Scholarship Program, dunia Knowledge Series as well as blood donation drives and social welfare initiatives. Through these initiatives, we were able to empower people, enable their success and enrich their lives.

Recognized for excellence

The dunia difference and commitment to excellence has been recognized over the last nine years with a number of respected awards and acknowledgements. 2016 saw the addition of more such acknowledgements, such as:

  • dunia received the “Dubai Endowment Sign” from the Mohammed Bin Rashid Global Center for Endowment Consultancy in recognition of the Dunia Young Business Leaders Program
  • The Indian Institute of Management Ahmedabad (IIMA) published a case study about dunia’s journey of building the dunia brand and providing a unique customer experience through innovative marketing communication and advertising strategies.
  • The Forbes Middle East recognized us in The Top 50 Business Leaders in the Arab World, ranked 15.
  • dunia signed the Dubai Declaration on Sustainable Financing in the United Nations Environment Program (UNEP) Finance Initiative’s 14th Global Roundtable, making dunia the only finance company amongst banks to sign the declaration.
  • dunia’s Annual Report 2015 won the Platinum Award from the League of American Communications Professionals (LACP), ranked 15 worldwide.
  • dunia’s Sustainability Report 2015 won the Gold Award from the League of American Communications Professionals (LACP), ranked 23 worldwide.

Looking ahead

In 2017, while we continue to face headwinds, we as an institution have the strength and muscle to succeed owing to the discipline that we followed in 2016, the timely investment in people, process and technology, the commitment and grit of our people and the support of our shareholders and regulators. While we remain resilient due to our investment in good times, the result of this investment in our customers, service, talent and the community will enable us to be the fastest to realize opportunities when the market recovers. We will realize these opportunities by focusing on partnerships, expanding in scale, expanding in scope and continuing to transform from the core, all this while remaining insurgents who are customer-centric. As we look ahead into the year, we are determined to give back to the UAE and realize our dream of empowering people, enabling success and enriching lives.

Rajeev Kakar
Managing Director & CEO