When Palestinian entrepreneur Hashim Shawa looks at his homeland, he sees both challenges and opportunities. Throughout the past decade, GDP has declined steadily and unemployment has doubled, leaving a growing population with too few economic options. But the entrepreneur’s eye still sees ways to move the situation forward. It is this eye that guides Bank of Palestine, of which Shawa is CEO.
Bank of Palestine is working closely with IFC to meet several priority needs in the West Bank and Gaza, beginning with the offering of combined investment and advisory products.
Over the past year, IFC’s Advisory Services team in MENA has been working hand-in-hand with the bank’s management to help it create a solid risk management system, an important ingredient in ensuring the sustainability of any bank. IFC advisors helped the bank, for the first time, define its near- and long-term strategic objectives, as well as its risk appetite, and create an effective board governance framework.
The 11-member board went through detailed discussions about strategic alternatives, target markets, product development, customer segments, risk metrics, and performance targets. Since IFC's involvement, it has opened 10 new branches, giving thousands of people their first opportunity to save money safely, obtain small business loans, and afford higher education for their children.
IFC took on a significant role in the process, buying a five percent stake in the bank, and committed to develop new products that would be good for business, as well as development. The investment was a vote of confidence that sent an important signal to others, and has performed well since it was made.
Bank of Palestine was established more than 50 years ago. Despite the challenging situation, the bank managed to have the widest outreach in West Bank and Gaza, offering services previously unavailable to consumers.