Our Wholesale Banking Group plays a vital role in the UAE's diversifying and growing economy, serving the entire spectrum of clients from large corporate and government-related entities, to mid-corporates, and smaller sized enterprises. The low oil price economy and tighter credit and liquidity conditions in the UAE market have had varying impacts on these segments, hitting hardest on the smaller end of the spectrum. Yet each segment continues to grow and so does our business share with them.
Wholesale Banking Group delivered year-on-year growth of 3% in operating income at AED 2.579 billion and 9% growth in operating profit before impairment allowances at AED 1.878 billion. Customer deposits increased 12% to AED 66 billion and net loans and advances to customers increased 11% year on year to AED 87 billion as at 31 December 2016. Loans to banks decreased 52% year on year to AED 3.6 billion due to conscious decisions to reduce this portfolio. Whilst external market conditions were challenging in 2016, the bank stayed on plan and posted strong results for our wholesale business.
We continue to grow our wholesale loan book faster than the market, whilst maintaining our well-known disciplined approach to pricing, lending conditions and counterparty risk. We avoided non-economic loan business during the year. This business remains focused on taking market share where we believe we can be competitive, managing and building on our relationships, and delivering a differentiated level of service.
Despite the current economic environment, we continue to invest in our business and infrastructure, including an upgrade of our core banking system and a set of digital initiatives to improve our offerings and enhance the customer experience. These are costly and lengthy endeavours but important for keeping ADCB at the forefront of the UAE banking sector, and for delivering regular functionality improvements for clients.
We grew our business in serving small to medium size enterprises (SMEs) in 2016, where we remain positive on business opportunity despite present pressure on some firms. SMEs remain a net contributor of liabilities to our balance sheet. Our SME client roster is now over 19,000 strong, and our focus has been to grow our share of wallet with these customers in a controlled manner. We also have increased the number and proportion of new loans that are collateralised. ADCB remains one of the few providers still fully open for business in this critical segment of the UAE economy. We will therefore continue to invest in this segment. In 2016, we increased the number of relationship managers by 25% to help us serve and build out further capabilities for the SME segment.
Mid-corporates also face a challenging time in a rapidly changing risk environment. ADCB benefits from having built a clean loan book in this segment, with high quality lending and stringent discipline in client selection. Our focus on mid-corporates is relatively new, and we have built substantial market share in this segment over the past five years.
Both our SME and mid-corporates businesses remain self-funded and self-contained, earning growth client by client. In 2016, our loans to SMEs increased by 10% whilst loans to mid-size corporate clients increased by 40%. ADCB continues to have appetite for both these segments and continues to invest in serving them better.
We maintain our position as a large and growing force in serving large corporates and government-related entities in the UAE. In large part, this segment has been well-prepared for the current more difficult market, having deleveraged or restructured financing. We are very clear on the type of business we want to do in this segment. We will not do business on non-economic terms, and are known to walk away from underpriced loans. We are still able to provide investment and transaction banking solutions to such clients successfully.
Aldar Head Office
In all our segments, our teams focus on transactional banking, because it broadens our relationship with the client and gives us good client retention. Our transactional banking business had a record year in 2016, in every market segment. We continue to invest in and focus on transactional banking because of the breadth of new client relationships it can provide, and the accompanying strong client retention.
Our leading cash management business once again delivered a record number of new client mandates and a record number of cash management clients across all segments, with payment automation now at 86% of all activity. These clients tend to be loyal; more than 95% of the cash management clients who banked with us in 2011 are still customers today.
Pro-Cash, our award-winning online transaction banking platform, is key in securing business with large corporates and government clients. It also supports smaller clients; more and more SMEs have embraced this technology, leading to a 25% increase in transactions in 2016. Many of these clients have not yet reached a level of growth where they can invest in enterprise resource planning systems of their own. Our portal provides them the automation and visibility into their banking and finances they need. As an additional enhancement, our Pro-Cash platform is now mobile.
Much of our payments processing is straight-through, which reduces error rates and lowers the cost of doing business for both the Bank and our clients. Our world-class cash management and client services also enable strong current account and savings account (CASA) growth. CASA are low-cost deposits which help to support the Bank's funding needs. In addition, we have re-engineered our commercial credit processes to simplify and minimise time. Three years ago, our average turnaround time to approve SME loans was 128 days. Now it is 39.
ADCB has received numerous prestigious awards for cash management over the years, and been ranked by Euromoney magazine as the top cash management provider in our home market in its last two rankings. The publication also awarded the Bank global “Five Star” status for cash management, based on an extensive survey of client feedback worldwide. This puts ADCB in select company — fewer than ten banks around the world earned this accolade in 2016.
Euromoney also recognised ADCB as the “Best Domestic Trade Finance Provider in UAE” for the second consecutive year. This prestigious award is based purely on client feedback and reflects ADCB's position as a preferred bank of choice for our clients' working capital needs. Early in 2016, to strengthen the real estate market and protect buyers and sellers, the Government of Abu Dhabi established a legal requirement for escrow related to real estate development projects. As a leader in providing such escrow services elsewhere in the UAE, ADCB was asked to consult on structuring the regulation and became the first registered escrow bank in Abu Dhabi. The Bank has been cultivating efforts to provide industry-leading escrow services since 2007 when similar laws were first announced in Dubai. Initial clients include the Tourism and Development and Investment Company (TDIC), the master developer of major tourism, cultural and residential destinations in Abu Dhabi. TDIC has signed an escrow accounts agreement with ADCB for its upcoming projects, as has Aldar Properties for its Yas Acres development, a golf and waterfront community of 1,315 villas and townhouses on Yas Island.
ADCB continued to benefit from its strategic banking relationship with Bank of America Merrill Lynch, providing their business clients access to our cash management and transaction banking services while giving our clients access to a truly global network.
Our high-quality services to business clients across the UAE include cash management, transaction management, trade finance, corporate finance and investment banking. In addition, our Wholesale Banking Group is also responsible for ADCB's Indian branches and has representative offices in London and Singapore, as well as a selected offshore offering through ADCB's Jersey branch.