Islamic finance has gathered momentum and gained quite an extraordinary reputation these past few years, and is now a mainstay of the global financial system, thanks in part to the work of those leading its many sharia-compliant constituents. First among the regions to have benefited is the GCC, which has seen a remarkable rise in Islamic banking of late and has come to represent a key focal point for the industry going forward.
Since Islamic banking entered its ‘modern phase’ a little over three decades ago, it has undergone numerous fundamental changes to its makeup, in addition to having overcome the many and diverse challenges posed to it by the international financial community.
Qatar First Bank’s newly appointed Acting CEO, Ahmad Meshari, has overseen the development of Islamic finance in Qatar. “After demonstrating its resilience to economic downturns, Islamic finance has gained global interest with non-Muslim countries like Britain looking at ways to tap into this emerging market. In Qatar, many initiatives were undertaken to ensure proper regulation and encourage the introduction of innovative retail products to allow this niche sector evolve into a profitable oriented industry,” said Meshari to Investvine. “Islamic finance still has a lot of potential for growth. According to a study undertaken by Ernst & Young, it is expected to cross the milestone of $2trn [worldwide] by 2014.”
Meshari’s proficiency in navigating the region’s complex financial landscape is due to 30 years of experience in financial services and his capacity to conquer the obstacles that have arisen throughout his career.
Meshari’s proficiency in navigating the region’s complex financial landscape is due to 30 years of experience in
Meshari’s first steps in the industry were taken in 1982, studying Business Administration at Kuwait University and specialising in banking and finance at the same time working as a public relations officer for the Kuwaiti government. Meshari progressed to commercial and administrative manager for Meshwar Al-Kuwait Commission Agent, of which he was also the co-owner, where his business administration training was employed to full effect.
Meshari later returned to the Kuwaiti government in 1988 and assumed the role of loan officer, participating in preparing the annual budget, setting criteria for loan applications, coordinating the timely collection of payments and generally putting to practice his penchant for financial affairs.
His experience in dealing with these matters would remain with him, as he went on to open his own convenience store in Ottawa in 1993, and manage the day-to-day operations, whether they were financial planning, procurement or selling. It was a mere four years before he was awarded an MBA and soon after crossed the Atlantic to join Qatar Islamic Bank as a relationship manager.
Climbing the ladder
Meshari’s beginnings in corporate banking saw him combine the attributes he’d honed on the job previously, as his experience dealing with clients and financial prowess were put to use when identifying prominent clients for the bank. After four years in the role, he began a new tenure as contracting and real estate department manager for the firm. With this responsibility would come a portfolio worth QAR 2.8bn, as well as a raft of new responsibilities.
He would move up the ladder again in 2004, as he took on a role as an executive manager and assumed responsibility for a portfolio worth QAR 6.5bn, as well as for the division’s strategy, business plan and goals.
It was from this point that onlookers began to take Meshari’s achievements seriously, and he became sought-after as a top talent in corporate Islamic banking. Following a year-long stint at Sharjah Islamic Bank as head of corporate banking and senior vice president, Qatar Islamic Bank rehired him in 2008, and he was appointed to the positions of assistant general manager and head of corporate banking.
It was on his return trip to Qatar Islamic Bank, and a short two years after his promotion to general manager in 2008, that he would finally be appointed acting CEO, go on to lead the firm’s transformation and promote a performance-driven culture from the top down. After having acted out his three-year strategic plan and identified a number of new market segments and value propositions, Meshari stepped down in 2013 and acted instead as deputy chief executive to focus on developing a business strategy and extending the bank’s market share.
The firm is continually scoping out
Meshari’s experience in financial services is far from confined to his work with Qatar Islamic Bank. Quite the contrary, he is a Fellow at the Arab Academy for Banking and Financial Services and a Certified Lender of Business Banking since 2003, appointed by the US Institute of Certified Bankers.
Meshari’s valuable contribution to the world of Islamic banking looks on course to continue with his recent appointment as Qatar First Bank’s (QFB) new Acting CEO, a position he will no doubt relish given his experience in the market and proven ability to identify emerging market opportunities.
Established in 2009 and formerly known as Qatar First Investment Bank (QFB) ranks among the region’s most enterprising sharia-compliant financial institutions and offers a comprehensive suite of financial services and products. With fully paid up authorised capital of QAR 2bn ($550m), QFB is well positioned to negotiate the burgeoning Islamic finance market in the wider MENA region, and having appointed Meshari as Acting CEO, the firm’s prospects look bright.
Regulated by the QFC Regulatory Authority (QFCRA) and ISO 27001 certified, QFB offers services spanning principal investments, asset management, corporate and finance, and recently introduced commercial banking services on a personal and wholesale basis.
The bank is entirely unique in Qatar, in that it’s simultaneously independent and central to the market, providing clients and counterparties with access to one of the region’s deepest pools of capital. Underpinned by Meshari’s expertise in the sector, QFB adopts an investment strategy that centres on sector and geographical diversification, and targets the sectors it considers to be key drivers of economic change, these being energy, financial services, industrials, real estate and healthcare.
Among the most impressive contributions to these sectors is a $111m investment in the healthcare sector – a 20 percent stake in Memorial Health Care Group in Turkey; and a 4.78 percent stake in UAE-based Al Noor Medical Company. Both investments, as with a great many others, performed strongly, Memorial Healthcare in particular, having registered a CAGR of 52 percent from 2010-13. Another of the firm’s many impressive investments can be seen in the industrial sector, with the acquisition of a 71.3 percent stake in Emirates National Factory for Plastic Industries (ENPI), which after 3.4 years QFB exited and generated an internal rate of return of 31 percent.
The firm is continually scoping out investment opportunities in and beyond the aforementioned sectors (see Fig. 1), and invests in businesses that maximise shareholder value through robust growth and significant capital appreciation. QFB’s investment track record is proof of the bank’s success, and since its inception the bank has invested $579m in 18 transactions spanning the GCC, broader MENA and Turkey, managing to generate profits annually and successfully exiting four investments and one partial exit thus far.
Not least of QFB’s achievements is its strong financial record these past few years. The bank’s earnings per share rose 45 percent from 2.48 cents in 2010 to 3.61 cents in 2012, and its net income also exhibited 45 percent growth through the same period, amounting to $31.1m in 2012. Owners’ equity was up 2.4 percent through the same period, to $465m, and a progressive dividend policy for shareholders has seen the bank distribute five percent, six percent and seven percent of paid up capital through 2010, 2011 and 2012 respectively.
Under Meshari’s leadership, the bank has set in place an ambitious plan for the future, and is hoping to soon list its shares on the Qatar Exchange, which would reaffirm its stature as a formidable sharia-compliant financial institution. QFB will no doubt continue to build upon its achievements thus far under Meshari’s watch and expand further still on its MENA footprint. With the new Acting CEO’s eye for financial opportunities and keen understanding of the marketplace, QFB is on course to reap a far greater share of the market and spearhead growth in Islamic finance.