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Middle EastJanuary 2 2014

The Middle East's biggest movers and shakers in 2013

A profile of the appointments who made an impact in banking and finance in the Middle East in 2013.
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The Middle East's biggest movers and shakers in 2013

Alex Thursby, group chief executive, National Bank of Abu Dhabi

Alex Thursby took the helm at National Bank of Abu Dhabi (NBAD) in July 2013, replacing Michael Tomalin, who had been in the role for 14 years. NBAD stood as the United Arab Emirates’ largest bank by asset size at the end of the third quarter of 2013 with assets of Dh345bn ($93.9bn).

A veteran UK banker with decades of experience in the Asia-Pacific region, Mr Thursby will be instrumental to the bank’s current international expansion drive as it pushes into fast-growing emerging markets. He has just unveiled his 2013-18 vision and strategy for NBAD, based around three geographical pillars to be achieved primarily through organic growth.

“NBAD’s strategy will pursue growth by building the largest, safest and best performing bank, first in the UAE and over time in the [Gulf Co-operation Council countries], second by deepening our wholesale network and third by building five international bank branches in the largest and fastest growing economies in the West-East corridor,” says Mr Thursby.

The second pillar aims to further integrate its existing European and North American platforms into its wholesale network. In December, NBAD announced plans to add about 900 jobs to its current headcount of 6500 across 18 countries in 2014, with a focus on new hubs in emerging markets, as well as retail and commercial operations at home.

NBAD has set its sights on quadrupling its annual earnings to Dh16bn by 2021 by setting itself up as a trade bank for emerging markets between the Middle East, Asia, Africa and Latin America.

The bank opened offices in Shanghai and Malaysia in 2012. It has hired a head for its Latin American operations based in São Paolo and is planning to open offices in Lebanon, South Sudan, Turkey, India, Iraq and South Korea in the next two years.

During his six-year career at ANZ, Mr Thursby served as the chief executive of Asia-Pacific, Europe and the US, among other positions, and he was the architect of the bank’s international expansion. Prior to that, he worked for 21 years at Standard Chartered Bank, managing its business in diverse geographical areas, including Africa, the Americas and Asia-Pacific.

Tamim Al-Kawari, chief executive, QInvest

Tamim Al-Kawari was appointed chief executive of the wholly Islamic QInvest in November 2012, having previously served as QInvest’s deputy chief executive. QInvest is Qatar’s largest investment bank and, with operations across the Middle East, Africa and Europe, is one of the most prominent Islamic financing institutions in the world.

Mr Al-Kawari has wasted no time in streamlining operations at the bank and, in October 2013, announced that QInvest would focus on three core business lines: investment banking, asset management and investing its own capital. Areas such as wealth management and brokerage services have been discontinued.

With an authorised capital of $1bn and paid-up capital of $750m, QInvest will now focus on catering for companies that are seeking access to capital in Qatar and the broader region. It is keen to bridge the gap left by the retrenchment of large global banks in advising big family-owned and state institutions that are seeking to expand investments.

QInvest served as one of the advisors to the Turkish government on its $1.25bn sukuk sale in October 2013. The bank also served as an advisor to Kingdom Holding, the investment firm controlled by Saudi Arabia’s Prince Alwaleed Bin Talal, in its $400m acquisition of a stake in Chinese online retailer 360Buy. It will also advise Qatari entities deploying capital abroad and co-invest in long-term deals such as management buy-outs and buy-ins, and leveraged buy-outs.

In April 2013, Mr Al-Kawari brought in Michael Katounas to run QInvest's investment banking division. Mr Katounas was previously a director at Credit Suisse’s investment banking division in Dubai.

Prior to joining QInvest, Mr Al-Kawari worked with Goldman Sachs for five years, most recently as a managing director and chief executive for Qatar. Prior to this, he was the chief financial officer for Qatargas Transport Company (Nakilat) where he implemented a $8bn programme to finance 27 vessels that ship liquefied natural gas from Qatar to end-users worldwide.

Brett Schafer, chief executive, Dubai International Financial Centre Properties

Brett Schafer was appointed to lead the growth strategy of Dubai International Financial Centre (DIFC) Properties in May 2013.

In July 2012, DIFC announced the restructuring of the centre’s core functions into independent entities, with DIFC Authority the new business development and legislation arm, and DIFC Properties established as part of DIFC Investments to manage the centre’s real-estate portfolio and deliver DIFC’s masterplan.

In October 2013, DIFC announced it was seeking investment worth Dh15bn through joint ventures to develop its remaining 930,000 square metres of building potential as further growth and market demand drive expansion. DIFC Properties will develop this on a joint-venture basis with appropriate developers and investors. The expansion will be completed over the next 10 years and will comprise 65% offices, 20% homes and 15% retail. DIFC also plans to develop two hotels, including a 150-room specialty hotel that will start in 2014.

Mr Schafer has already updated and revalidated the entire DIFC master development, ensuring all elements are interlinked. One of his objectives is to physically connect all the key buildings together, for example, Index Tower, Central Park, Emirates Financial Tower, Damac Park Towers, Daman Tower and Sky Gardens. More than 1000 companies currently operate within the 1.4 million square metres of completed buildings in DIFC.

Mr Schafer brings more than 30 years of experience in the commercial property sector across the Middle East, US and Canada to his role at DIFC Properties.

Ahmed Ali Mohamed Al Sayegh, chairman, Abu Dhabi Global Market

Formerly the chief executive of Abu Dhabi’s Dolphin Energy and chairman of the emirate’s renewable energy company, Masdar, Ahmed Ali Mohamed Al Sayegh was appointed chairman of the Abu Dhabi Global Market (ADGM) in August 2013.

A financial free zone being built in Abu Dhabi to rival the DIFC, the ADGM aims to bridge the time gap that occurs during the slowdown of international financial markets between 7am and 11am United Arab Emirates time (3am to 7am Greenwich Mean Time). Indeed, ADGM’s biggest selling point will be its potential to serve investors in global securities during the so-called ‘blackout zone’ when most Asian, European and American markets are closed. During this time, it aims to take a lead in financial markets by market-making and price-producing across a range of foreign exchange and over-the-counter products. Outside these hours, it will offer a full range of financial services and aims to act as a strategic link between financial markets in Asia and Europe.

Speaking at an industry conference in Abu Dhabi in October 2013, Mr Al Sayegh said: “ADGM will include commodities trading, storage and transport, derivatives trading, custody, settlement, clearing, depository service, foreign exchange and wealth management.”

An official briefing document published in October 2013 outlines the development plan for ADGM going forward. “The focus will now be on preparing the operating model for implementation, along with the associated regulation and regulatory frameworks,” the document says. “During that time, ADGM will deal with applications for participation and partnership in the market and free zone, so that it will have critical mass by the third and fourth quarter of 2014.”

The ADGM hopes to optimise international participation and will have capacity for 75,000 employees. It is viewed as a key part of the Abu Dhabi government’s broader economic strategy, contributing to the further establishment of the financial sector and the emirate’s ongoing economic diversification away from oil.

Unlike the DIFC, ADGM also aims to specialise in the handling of physical commodities, which will be shipped in via Abu Dhabi's Zayed and Khalifa seaports, the airport and railway. Located on a 114-hectare site on Al Maryah island, the free zone will include offices and commercial premises, as well as residential, hotel and leisure facilities.

Dr Jamil Ak El Jaroudi, chief executive, Bank Nizwa

Dr Jamil Ak El Jaroudi was appointed chief executive of Bank Nizwa, Oman’s first standalone Islamic bank, in March 2012. Established as a retail bank with capital of $389m, Bank Nizwa officially opened its doors to the public in January 2013 and has already become a key player in the local banking market.

It currently has a network of eight branches spread across the country and is planning to add another five by the end of 2014. Its growth is being fuelled by the introduction of new products and services to the market and ongoing innovation.

Bank Nizwa currently offers products such as current and savings accounts, personal finance, as well as corporate business services and treasury operations. It was set up to tap the demand for Islamic products and services that was previously being met by Oman’s neighbouring Gulf countries. It was estimated that the equivalent of $11bn in Omani rials had been deposited in Islamic banks across the Gulf Co-operation Council. The pent up demand was made apparent by the bank’s successful initial public offering of a 40% stake in May 2012, attracting $1.77bn-worth of bids in the form of 37,000 subscribers, making it 11.3 times oversubscribed.

In 2011, Ernst & Young forecast that a successful roll-out of Islamic banking infrastructure could see the industry in Oman gaining up to $6bn in Islamic assets over the next few years. The country’s total banking assets stand at about $45bn. Initially Bank Nizwa plans to build its presence at home but the long-term goal is to become an international bank.

Mr El Jaroudi has extensive experience in the region’s banking industry, joining Bank Nizwa from Elaf Bank in Bahrain, where he was the chief executive. In the mid-1990s, he co-established the Middle East Capital Group in Lebanon, the region’s first merchant bank with a pan-Arab focus.

Shayne Nelson, group chief executive, Emirates NBD

New Zealander Shayne Nelson is Emirates NBD’s new group chief executive, assuming the role in January 2014. Emirates NBD ranked as the United Arab Emirates’ second largest bank by assets after NBAD at the end of the third quarter of 2013 with assets of Dh332bn ($90.5bn).

Along with the reshuffle at NBAD, it represents another changing of the guard at one of the major UAE banks. Emirates NBD is Dubai’s largest bank by asset size and is 56% owned by Investment Corporation of Dubai.

Mr Nelson previously worked with the UK’s Standard Chartered since 1997. He has extensive experience in the Middle East, having been regional chief executive for the Middle East and north Africa and UAE chief executive for Standard Chartered before being tapped to head its private bank in July 2010. In this most recent role, he also held additional responsibilities for the UK lender's small and medium-sized enterprises banking section.

He has also served as chairman of the bank's Islamic banking unit, Standard Chartered Saadiq, and was a director of the bank's China business. He replaces Rick Pudner who joined Emirates Bank as chief executive in early 2006. Mr Pudner oversaw the merger with National Bank of Dubai in 2007 in what ranks as one of the region's largest tie-ups to form the current Emirates NBD.

Along with most large Gulf banks, Emirates NBD has been increasingly looking outside its home market to generate revenue due to fierce competition and limited growth opportunities at home. With 23 national banks and 28 foreign lenders servicing a population of 8.3 million, the UAE’s banking sector is arguably the most saturated in the Gulf and competition is intensifying, making the need to expand overseas all the more important.

In June 2013, Emirates NBD acquired the Egyptian business of France’s BNP Paribas for $500m, marking its first foreign buy and a major step towards diversifying beyond its Dubai base.

Mr Pudner announced in November 2012 that Emirates NBD was targeting international revenues of about 15% to 20% of its total in five years’ time, up from 5% at the time. At the time of announcing his resignation in April 2013, Mr Pudner said that the upcoming change in chief executive would not derail the bank’s overseas expansion.

Abdulla Saleh Al-Raisi, chief executive, Commercial Bank of Qatar

Abdulla Saleh Al-Raisi was named as the new chief executive of Commercial Bank of Qatar (CBQ), the country’s second largest lender by assets, in August 2013. Mr Al-Raisi joined the bank in 1998 and worked in both the retail and corporate banking divisions before being appointed as deputy chief executive in March 2007.

Mr Al-Raisi’s appointment will enable Andrew Stevens, who remains CBQ’s group chief executive, to focus on the bank’s international strategy, as well as the management of its existing overseas presence. CBQ successfully acquired a 34.9% minority stake in National Bank of Oman in 2005 and a 40% stake in United Arab Bank in 2008.

In July 2013, CBQ completed the acquisition of a 70.84% majority stake in Alternatifbank, paying two times the book value as of June 30, 2013. In September, it acquired a further 3.4% stake in Alternatifbank through a public tender offer, increasing its total ownership to 74.24%. The remaining shares are held by the public (0.76%) and Anadolu Endustri Holding (25%).

"The acquisition is an important step in Commercial Bank’s strategy to expand its footprint in retail and corporate banking outside the [Gulf Co-operation Council] region,” CBQ notes in a statement. The deal also represents one of CBQ’s biggest investments, its first investment in Turkey and its first acquisition of a majority stake in another bank.

Turkey and the Middle East have an increasingly close financial and economic relationship, with the Middle East and the Caucasus accounting for 28% of Turkey’s exports, twice the level seen in 2008. Exports from Turkey to Arab countries increased 11-fold in the past decade, while imports from Arab countries grew 12-fold, with the total level of bilateral trade standing at nearly $50bn in 2012. Turkish investment in the Middle East and north Africa region has grown from about $5bn to more than $34bn in just under a decade.

Adnan Chilwan, chief executive, Dubai Islamic Bank

Adnan Chilwan was appointed chief executive of Dubai Islamic Bank (DIB), the United Arab Emirates’ largest Islamic bank by assets, in July 2013. He had previously served as deputy chief executive and replaces Abdulla Al-Hamli, who has been appointed managing director.

The management reshuffle at DIB comes as the bank is staging renewed growth after it set aside about Dh5bn ($1.36bn) against bad loans that surfaced following the 2009 Dubai property crash, which saw prices plunge by nearly 60%.

Mr Chilwan says the bank has cut real-estate investment to 28% of its portfolio from 37% in 2008 and that it would be happy to trim its exposure further. He also says the financial crisis has forced a rethink of how the bank should structure its portfolio and prompted a shift away from a focus on real estate towards being more centred on consumer and wholesale banking.

After spending the past five years cleaning its books and strengthening its core banking operations, Mr Chilwan expects DIB to record about 17% growth in net profit in 2013. In March 2013, DIB enjoyed considerable success when it launched a $1bn hybrid perpetual Tier 1 sukuk (Islamic bond) that attracted $14bn in orders. The sukuk increased DIB’s Tier 1 capital ratio to 18.7% from 13.9%, making it only the second Gulf bank to issue such a sukuk after the Abu Dhabi Islamic Bank $1bn issue in November 2012.

During 2013, DIB also took almost full control of Islamic mortgage lender Tamweel, enhancing its ownership to nearly 90% from its previous stake of 58%. In September, DIB announced it had settled all Tamweel’s bilateral liabilities, amounting to nearly $1.2bn, two years ahead of scheduled maturity. The outstanding liabilities were part of a five-year moratorium agreed with Tamweel creditors in late 2010 and were scheduled to mature in October 2015.

DIB is now eyeing possible geographical expansion into Asia, east Africa and the Middle East, with particular interest in Indonesia and maybe India. It has also expressed an interest in the European markets once the current problems in the eurozone have been resolved.

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