Rania Nashar: Saudi Arabia’s First Female CEO Of A Commercial Bank

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SOURCE: Forbes Middle East

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Publicly, it happened overnight. Within the space of a few hours, the name of Rania Nashar name went from one little known outside the insular Saudi Arabian finance industry to a clicked and hash-tagged global news item anointing the first female leader of a listed Saudi commercial bank.

Privately, however, Nashar’s ascension to CEO of Samba Financial Group was a journey 20 years in the making marked not by meteoric rise but by slow, persistent advancements.

When she joined Samba in 1997, Nashar’s biggest professional concern was Y2K, the phantom digi-pocalypse that never was. Now, overseeing real assets in excess of $61 billion, Nashar must lead Saudi Arabia’s third largest financial institution through a sluggish economic climate while the Kingdom’s leadership pursue historic reforms—all under the glare of newfound spotlight.

Nashar’s appointment is more than a mere management change. “This is big,” said Lubna Qassim, an Executive Vice President at Emirates NBD and a member of the 30% Club’s GCC chapter which advocates for broader female inclusion in business.

“This needs to be celebrated in every form, because this is how we demonstrate to young women (and men) in the region that there is no limit to your dreams and becoming a CEO is a career option not only limited to men”.

In her own telling, however, Nashar’s career at Samba has been defined less by gender than by the bank’s evolution. When she came on board, Samba was a Citibank affiliate with Wall Street-style culture and a largely brick-and-mortar business model in keeping with the times.

“The consumers were more focused on the classic banking where they come in and have to meet someone with a suit at a brown desk—this classic conventional banking,” Nashar recalls.

After working on the merger with United Saudi Bank in 1999 made Samba one of the largest financial institutions in the Middle East, Nashar flexed her degree in Computer Science and Technology from King Saud University to develop digital services for the expanding business.

In 2003, Citibank terminated its Technical Management Agreement with Samba and the bank became a Saudi institution, fully exposed to both the advantages and adversities of the Kingdom’s oil-based economy. Nashar recalls 40 days of almost nonstop work between Citibank’s announced departure and their offices clearing out.

Riding the tide of the Kingdom’s steady economic growth and relatively stable oil prices, Samba’s assets grew over the following decade from $25.3 billion to $57.8 billion in 2014.

Nashar’s career followed suit: she was tapped to lead major projects, which included building a centralized regulatory compliance department and developing company-wide anti-money laundering strategies while serving as as the bank’s Head Compliance Officer.

During these boom years Samba expanded regionally, acquiring assets in Pakistan and opening branches in Dubai, Qatar and the U.K.

But the global crude glut and resulting low oil prices witnessed since 2014 recent years have taken a toll on the Saudi economy as the long-flush government grows accustomed to a tighter belt. The government’s slimming checkbook translates to a pared down loan book for national banks, including Samba.

Samba’s “balance sheet growth has slowed down markedly over the past year, down to the low single digits,” says Murad Ansari a Managing Director of Financial Research at EFG Hermes.

“This has largely been driven by the fact that you have an economy that is going through reforms, and low oil prices certainly aren’t helping.”

With welcome candor, Nashar acknowledges the unseasonable chill in Saudi’s economic climate. “Currently there is uncertainty in the oil prices which is challenging for an economy like Saudi Arabia where you have a single commodity: oil. The country has changed its vision and the way it does business. We also have to react to the changes in the economy,” she said.

It was amid this uncertainty that Nashar was called into a meeting with the bank’s Chairman, Eisa Mohammed Al-Eisa, and told she was being nominated for the position of CEO. After thinking for a moment, Nashar describes her reaction to the news in one word: speechless.

Increasing responsibilities and managerial roles had set her on track for a senior position in the company, but Nashar says she had little inkling that she was under consideration for the role of CEO.

If Nashar’s surprise may be attributed at least in part to professional modesty, the lack of precedent was surely also a factor. Never before has a woman led a publically listed commercial bank in Saudi Arabia.

The dearth of women in executive positions at banks and financial institutions is far from exclusive to Saudi Arabia, Nashar quickly points out. “All over the world, you don’t see the inclusion of females on the boards or the senior positions across the financial sector.”

Historically, however, exclusion has gone well beyond the financial sector in Saudi Arabia.

Women comprise just 22% of the workforce in Saudi Arabia and still require the permission of a male relative to conduct important transactions. In a number of written decrees, King Salman bin Abdulaziz Al Saud has committed to relaxing the male guardianship system that prevents women from obtaining passports or getting married without the permission of a male relative.

It remains to be determined exactly which legal services women can attain without male oversight, however.

Nashar acknowledges female empowerment may not be happening fast enough in the Kingdom. “Change is happening, but its not at the pace that works with the ambitions of [Saudi] women,” she said.

“Currently there are a lot of wonderful females in Saudi. They are talented, well educated, hard workers. They just want the opportunity to prove themselves.”

There are, however, some indications that a real cultural shift is taking place. Just as news of Nashar’s historic appointment broke, the Saudi stock exchange, Tadawul, announced that its new chair of the board would in fact be a chairwoman—Sarah Al-Suhaimi, the CEO of NCB Capital, was selected for the post.

Within the same week, Latifa Al-Sabhan had been named as CFO of Arab National Bank, one of the Kingdom’s ten largest financial institutions.

“I think Saudi Arabia is going through a genuine reform process,” says Bessma Momani, a Professor at the University of Waterloo, of the recent appointments and legal amendments. “It’s driven by necessity—the necessity of recognizing that economically the exclusion of women is basically keeping 50% of its economic potential completely dormant.

“For decades, Saudi has been trying not only to diversify [its portfolio] but also trying to find a way to tap into its existent resources and known input goods. What it has is human capital and talent that is underutilized.”

Others, however, question whether the rise of female leaders will make a meaningful difference for women in Saudi Arabia who may lack the education, resources or network to reach similar professional heights. “This does not open doors for those at lower levels of the economic spectrum—particularly those who are more vulnerable,” says Myriam Sfeir, Assistant Director at the Institute for Women’s Studies in the Arab World at the Lebanese American University.

“However, this symbolizes a breaking of the glass ceiling, they have transformed unrealistic aspirations to an achievable reality.”

Breaking the glass ceiling, however, is only part of the battle. As a pioneer in the industry, Nashar will be the object of intense and gendered scrutiny, says Nadereh Chamlou, a former Senior Advisor at the World Bank.

“If she takes a ‘Go getter’ approach, she may be branded as too aggressive. If her approach is, to use to use a cliché term, ‘ladylike’ she can be seen as being too soft. The range of behaviors comportment by men is so much wider than for women executives,” Chamlou explained.

Nashar, however, is confident in her managing strategy. Maintaining Samba’s asset quality through the economic slump is the first order of business, and playing it safe is the prudent course of action, she says.

“We don’t want to tap riskier areas just to increase our income but suffer from that risk later on down the road,” she says. “Maybe some will perceive us losing certain opportunities, but we believe that it is better that we always go forward with the business steadily and surely.”

Despite the economic pressures, major ratings agencies say Samba’s fundamentals are solid. “It’s very strongly capitalized. It is very profitable and its asset quality has remained very stable, in fact more stable than most other banks we rate in Saudi Arabia,” said Andrew Parkinson, a Director on the Financial Institutions team at Fitch Ratings.

“Samba has very resilient financial fundamentals and resilient capabilities. The challenge is to continue on that track,” agreed Christos Theofilou, an analyst with Moody’s Investors Services.

While staying the course may be the order of the day, the Saudi economy is changing. No longer able to be the sole provider of services and industrial growth, the government is looking to galvanize the private sector and diversify its oil-heavy holdings. Samba hopes to capitalize on new private sector partnerships both as a creditor and in an advisory capacity.

“We will see a policy focused on diversifying sources of income by investing the kingdom’s huge resources, activating the role of the private sector and promoting trade and industrialization,” Nashar explains.

The centerpiece of the privatization push will be the public listing of Saudi Aramco, Saudi’s national oil outfit. Aramco is believed to be the world’s most valuable company with Most industry experts estimating its market capitalization to be approximately 1 trillion. Saudi authorities have announced their intention to list Aramco both on an as yet undetermined foreign stock exchange and on the local Tadawul.

Samba has been selected to advise Aramco on its local Tadawul IPO. Quizzed about the deal, Nashar revealed only that discussions were still in the early stages.

Even though some of the challenges may be new, Nashar has rehearsed the company playbook by heart over 20 years. “I am not a stranger to Samba,” she says. “It’s the place where I have been all my career. I have seen it all. I know the smell of each and every brick in the building… It’s home for me.”

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