06 Sep Interview with Gregory Maheia, CEO, Atlantic Bank, Belize
What is your strategic vision and goals for the bank and the key industry issues on your agenda for this year?
The bank’s vision is to be the leading financial partner in Belize, empowering our customers to achieve their goals and realize their dreams. That resonates with everything that we do.
We opened in 1971 with seven employees at that time. Now 52 years later, there are 530 employees. We have the largest lending portfolio and the largest savings base in the country; we represent 60% of the savings base within the country. That speaks a lot to the relationship that we maintain with our customer base. It’s built on confidence and trust, that people are willing to save their money with us, for us to use their funds to lend and develop the country in its entirety and that’s what we do.
A past chairman said what’s good for the country is good for the bank. That is what we’ve always premised our actions and decisions on, the development of the economy, the development of the country and that the bank supported and then grew in tandem with that. The group has always been a significant supporter of the drivers of the country’s GDP. We are a corporate bank from a lending point of view, but from a deposit-based point of view, we’re materially funded by retail depositors. We take these deposits from salaries, we take care of them and make sure we invest and lend them strategically for the development of the economy, which translates back to retail customers as a better way of living, better quality of life, etc.
When you look at it from an economic point of view, we’re the largest supporter of tourism. Tourism is responsible for 30% of GDP. We are responsible for more than 75 cents of every dollar lent to tourism. Similarly, with agriculture, we’re responsible for about 60 cents for every dollar lent to agriculture.
Belize’s economic growth and resilience have remained notable, with 4.5% GDP growth in 2023 and 3.5% forecast for this year. What is your outlook on Belize’s economic trajectory, including the significant opportunities and risks you anticipate?
Belize has a population of a little less than 400,000 people. But from a landmass point of view, our land is significantly underutilized. There are a lot of opportunities in Belize, in agriculture and tourism. When you look at our tourism product, within an hour, you can be on a reef, an island, sipping a margarita, in San Ignacio looking at a Maya ruin and then go down to Placencia, be barefoot and enjoy a drink. It is a very unique product. When you look at our cruise tourism, it’s a completely different product that you don’t get anywhere else. There are a lot of opportunities there. More immediate opportunities lie in services. Over the last few years, there has been an explosion of call centers and business process outsourcing, that has helped to support the economy coming out of COVID. Belize is a very resilient economy, we are resilient people and Belize is poised to go to the next level.
What are some of the most pressing economic challenges and what measures can be taken by both the government and financial institutions like Atlantic Bank to address them effectively?
The government has been very proactive in the way that it has been treating any perceived risk or perceived shortfalls within the investment infrastructure and economic infrastructure in Belize. The Central Bank has been progressive in looking at policies that govern foreign direct investment and the way that foreign exchange moves. That is key.
An investor bringing funds into Belize wants to know that it is a safe economy—politically safe and generally safe—and that when they are ready, they will be able to take out their profits from their investments. Both the government and the Central Bank have been very progressive in treating those things very systematically since this government came into power. They’ve introduced the Investment Summit that has been doing very well. You have people from all over the world coming in and looking at what Belize has to offer.
Now from the banking sector, what we’ve done to prepare ourselves to support this, is we’ve ensured that our capital position is the strongest in the system. We currently have the largest paid-up capital in the banking system and we’re looking to bolster it even more.
In terms of tourism, if you look at the quality of resorts that people want when they come to Belize, you will have a segment of the market that will want the eco-friendly and backpacker version. But where you get true foreign exchange generation from is the higher-end resorts that require larger investments. To support that we’ve decided to bolster our capital base to be able to lend to these things and assume that level of risk.
We’ve done that for agriculture as well, the emerging markets, or reemerging markets in agriculture. Back in the day, coconuts were a huge business in Belize. Lethal yellowing came and then that phased out. But there’s another huge push for coconuts again. You walk into a grocery store in the US or wherever, if you look at the shelf space that’s dedicated to coconut products or coconut-based products, you see the level of opportunity that exists there. That’s what we’ve been doing, ensuring that our capital position is the strongest within the system and that our relationship with our International Financial Institutions (IFIs) remains strong.
Last year, we were the only bank with strong correspondent relationships, the Bank of New York and US Century Bank. Today, we have expanded that to include organizations within Central America. Now, we’re able to tap into two correspondent banks in the US as well as we’re able to service our wholesalers. Most of the wholesaling that happens in Belize, whether it be food or clothing, comes from El Salvador, food from Honduras, or clothing from Panama. So, we’ve established correspondent bank relationships with a bank in each one of those countries to be able to service our customer base.
We’ve partnered with Inter American Development Bank (IDB) and the MSME sector has become one of the most robust and dynamic sectors. The reason behind that is simple. Coming out of COVID, there were many people under-employed and unemployed. They say necessity breeds innovation. These people became self-employed; they became entrepreneurs. The government saw that. We started to support that sector significantly. The government then stepped in and put in place a legal infrastructure with the support of the Belize Trade and Investment Development Service to formalize the MSME sector, making it a strong growing one. Coming out of that and seeing our work with that sector, the IDB renewed that loan with us and increased it by 50%. That’s a tap on the shoulder to say we’ve been doing it right. We got a loan from them to support that sector and we’re continuing to support that sector.
Could you provide an overview of the bank’s key services and how they support economic activities?
From a lending point of view, we’re a corporate bank. The suite of products and services has been developed to support that sector over the last few years. Over the last three years, the bank has been repositioning itself to service all sectors within the country. We’ve built a strategic purpose where we want to be the preferred partner to our corporate clients, the driving force behind the development of the MSME sector and a key player within the retail market.
We’ve been tailoring products to satisfy the unique needs of each of these sectors, lending and deposit-base. The key advantage or our strategic advantage in Atlantic Bank is that we have a foreign exchange to meet the needs of our importers and those in tourism, agriculture, etc. That is simply because we’ve been the strategic partner to the tourism and agriculture sectors and the drivers of the GDP that generate foreign exchange. We’ve developed key products to support MSMEs because that is a very unique sector that needs very unique structuring products. The competitive advantage there is access to foreign exchange.
The correspondent banks and our relationships with the other IFIs, the fact that we are a Belizean bank and we make our decisions here at home, make us a lot more flexible in the way that we structure these things. We understand the real risks of operating within Belize and doing business in Belize. What’s good for the country is good for the bank. We will take risks that no other bank would normally take, because we understand those risks and to have the capital base to accept the risk is the reason that we take those risks.
What specific digitalization initiatives has Atlantic Bank Ltd. implemented and how have these initiatives transformed the bank’s interactions with its customers and operations?
The onset of COVID was when we were transitioning into the first world-class core banking system from SAP. In the region, we would have been the first to transition to them. That’s a testament to our commitment to full digitalization and moving all of our customer base towards that and utilizing and leveraging much safer and more efficient digital platforms. We’ve been looking at the core banking online and integration to make Belize a more cash-light society which makes everything a lot safer and more efficient.
We have the largest point-of-sale network in the country. If you add up all the other banks, we are still double the network in the country. That has been a very long and strategic move for us but one that has paid off because that is where we get our foreign exchange from. Our strategy was to get our point of sales terminal in every nook and cranny of this country where people can access it. Now, where we’ll be focusing is getting the customer base used to actually using it and stepping away from what everybody’s used to in Belize, which is cash. Everything else, all of our products and services are built to be utilized and leveraged on our digital platforms and we’ve spent a lot of resources to get there.
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