Mobile app-based transactions help MTB mobilise high deposits

While most banks in Bangladesh struggled to stay steady in a turbulent year marked by low deposit growth and shaky liquidity, Mutual Trust Bank (MTB) pulled off a rare feat—we thrived. Bucking industry trends, we recorded high deposit growth and solid profits, thanks to a mix of smart strategy, disciplined governance, and hard-earned customer trust. 

2024 saw loan disbursements slow down drastically, and deposit growth sink to its lowest point in recent memory. Yet, in the middle of this storm, MTB recorded the highest deposit growth among our peers and secured notable profits. Much of this success was driven by our bank's robust liquidity management system.

So how did MTB manage to mobilise nearly Tk6,100 crore in deposits in just one year, achieving a staggering 28% deposit growth—its highest ever—when the rest of the industry was struggling?

To put things in perspective, the overall deposit growth in the banking industry stood at just 7.5%, a sharp drop from 10% the year before. Depositors are the lifeblood of any bank. A bank earns trust when customers know they can withdraw their money on demand.

At a time when depositors were growing increasingly cautious, MTB managed to inspire confidence. In fact, following the liquidity crisis that unfolded after 5 August, many banks faced difficult moments—some couldn't meet withdrawal demands, leading to panic and long queues. But MTB was an exception. Our systems held firm, our customer service remained steady, and most importantly, our depositors didn't lose trust.

This level of stability during such a volatile year helped us strengthen our position and attract even more deposits—proving that in banking, trust is everything.

This was possible because MTB has been focusing on depositors for the past 5 years. A bank with a strong deposit base can invest in any sector. As such, banks with healthy deposits made significant profits by investing in government treasury bills and bonds. This was feasible due to the lower repo rate, which allowed banks to borrow at low cost and invest in government securities for higher returns.

Infographic: TBS

Even during the foreign currency crisis that began in April 2022, we remained stable thanks to robust liquidity management.

We ran several campaigns last year, set targets for our officers, and offered rewards. This motivated employees to bring in substantial deposits. 

MTB also introduced special recognition programmes for officers who met their targets from September to December, creating a positive energy across the bank and encouraging internal competition among staff, especially for those who had less direct contact with customers.

Our growth during the tough year was not accidental but stemmed from our own initiatives and, more importantly, from public trust in the bank.

After the events of 5 August, some banks still performed well because of strong corporate governance. Despite immense pressure, Our Board of Directors and management remained focused on governance. 

People withdrew more money than they deposited from the ten worst-performing banks last year. But since they could not keep large sums at home, they redirected those funds to stronger banks like MTB, leading to us mobilising Tk6,100 crore in deposits.

MTB'S profit growth was also impressive. Compared to 2023, our profit increased significantly in 2024. Although our investment portfolio was limited, heavy investments in government bills and bonds yielded great returns. The government also borrowed a large amount.

At times last year, the repo rate was around 8%, while government bills and bonds offered close to 12% returns. This margin allowed us to generate good profits, benefitting their shareholders.

Still, a large amount of money in Bangladesh remains outside the banking system – around Tk2.5 lakh crore in cash. This is mainly due to the public's lack of trust in financial institutions.

We also introduced a variety of products beyond fixed deposits, including millionaire schemes and double deposit plans. We also offer services like cash management solutions, corporate banking platforms, and payroll systems, with innovation being a key focus.

Putting a strong emphasis on mobile app-based transactions, our bank is currently able to serve 180,000 customers. This not only helps with deposit mobilisation, but also makes them more efficient. 

As fewer customers now need to visit branches, they can carry out all kinds of daily transactions through the app. RTGS and EFTN functionalities are fully integrated, allowing everything except large-scale transactions. 

MTB also has a large lounge network across the country, offering a wide range of facilities and driving up interest in our credit cards.

MTB's Board and brand value also helped us. Over the past few years, we have significantly improved our service quality and delivery, attracting loyal customers who act as ambassadors.

Looking to the future, we have launched multiple foreign deposit schemes with attractive interest rates and have conducted overseas campaigns. According to the bank, foreign companies won't suddenly start banking here without proper effort put into building that relationship.

We are working to bring more non-resident Bangladeshis into their foreign currency deposit programmes. Our website and Facebook page promote how anyone from abroad can open an account with MTB through our feature-packed app, leading to increasing engagement from expatriates.

Furthermore, we are also engaging in offshore banking through foreign loans, and have already made several breakthroughs. Although, more awareness and campaigns are required to make this even more popular.

That said, the recent negative rating by Moody's on the banking sector may have some impact. But if law and order improve, we believe remittance inflows can be significantly enhanced.