Gonzalo Gortázar, CEO of CaixaBank, talks about the crucial importance of digital transformation.
Global Finance (GF): What are the key drivers of CaixaBank’s performance in the last year?
Gonzalo Gortázar: There are many different drivers across various business areas that have progressively contributed to our success in 2018. Over the last few years, CaixaBank has focused on fuelling growth and driving our customer experience-centric strategy. Our innovation has left no area untouched: branch segmentation for value-added service, internal process digitalization for enhanced efficiency, investment in talent development to ensure the best-skilled teams, and the creation of new partnerships to broaden our offering and build a “beyond banking” ecosystem.
This strategy has also resulted in strong financials. In 2018, CaixaBank reinforced its leadership with market penetration, among Spanish retail clients for whom CaixaBank is their primary bank, of 26.3%. We have also improved across all margin lines and posted a net profit of almost €2 billion ($2.25 billion). These results came on the back of robust revenue growth, and an improvement in profitability to adequately cover the cost of capital, with ROTE [return on tangible equity] achieving 9.3%.
GF: How central is digital transformation to these results?
Gortázar: Very much indeed. Digital transformation is the key to the future of the banking sector, and at CaixaBank, we believe that it has to be focussed on offering the best customer experience and continuously adding value by means of innovative solutions. We mustn’t forget this is a people business, and we are committed to our clients.
Today, CaixaBank is the leader in the digital banking market in Spain, where it has the largest base of digital customers: 6 million, or 57% of the bank’s retail customers in the country, 5.2 million of whom are mobile banking customers. More relevant than that, 1.5 million customers visit our site daily, so new technologies are a platform with huge potential which allows our customers to be with us more often.
Even our physical branches have experienced a profound digital transformation process. We have implemented new technology, ranging from paperless transactions to innovative ATMs in order to enhance customer experience. For instance, I am pleased to announce that CaixaBank is the world’s first bank to offer ATMs that use facial recognition to withdraw cash without the need for a PIN number.
GF: How is innovation going to lay the foundation for future success?
Gortázar: New technologies and customer expectations require constant transformation and adaptation, and it is crucial that companies become more open, agile, collaborative and innovative.
Our new Strategic Plan 2019-2021 will prepare CaixaBank to face the upcoming challenges of a rapidly changing industry. One of the plan’s main pillars is to put technology not only at the service of our 15.7 million Iberian clients, but also, and above all, our 37,000 employees. In the coming years, we will accelerate our digital transformation to boost efficiency across all our business areas and processes, through continued investment in technologies such as AI (artificial intelligence), predictive modeling and robotics.
Our commitment to innovation is reflected in the high level of investment in development and technology: €844 million in 2018 alone. We are focusing all our efforts to become a leading and innovative financial group with the best customer service and a benchmark in responsible banking.
GF: How does the bank approach corporate social responsibility (CSR)?
Gortázar: A commitment to CSR is at the core of CaixaBank’s activities. As heirs to a 100-year-old institution dedicated to Spain’s socio-economic development, the bank carries in its DNA responsibility and social commitment. Our social vocation focuses on financial inclusion, promoting a savings-focused mentality, and active policies that respond to global societal challenges.
One example is MicroBank, the largest social bank specializing in microfinance in Europe, serving segments of the population whose financial needs are not catered for sufficiently by other institutions. Over the last decade, it has provided over €4 billion in microfinance.
Regarding environmental sustainability and climate change, in 2018 we became the first listed Spanish bank, and one of just a few European banks, to fully neutralize its carbon footprint, reflecting a commitment that goes beyond our legal obligations.
It all comes down to being prepared to fulfill our mission: contributing to the financial well-being of our customers and the progress of society.
