Could you provide a brief journey of how you arrived where you are today?
I started my career at KPMG and PricewaterhouseCoopers in the advisory and business services, working mainly on international assignments in a wide variety of industries. Later, I moved to corporate M&A in a Swiss blue-chip company. My job required extensive travels to the US, Africa and Asia to acquire companies, start new ventures and structure new companies. It was during that time that I gained a hands-on exposure to international investments. I joined Faisal Private Bank (FPB) in 2003.
What does your role involve?
As head of investments at FPB, my job involves managing funds for our clients who comprise private and institutional investors, each with specific needs. Devising the investment strategies and structuring new products are also core activities of the bank.
The investment team is composed of some 15 people and one of my key tasks is to make sure they deliver professional and efficient work as a team. In addition to this, I am also member of the management committee of the bank where, together with the CEO and other colleagues, I contribute to the day-to-day management of the company.
What is your greatest achievement to date?
We came a long way (and in the shortest possible time) together with all the employees of the bank from a licensed security dealer and finance company to become the first Swiss Islamic private bank. The merit for this outstanding achievement goes mainly to our CEO but the management committee did contribute to this by working towards that goal.
Which of your products/services deliver the best results?
As an Islamic bank specializing in what I call tangible asset based investments, in other words, private equity and real estate investments, these products have delivered the best risk-adjusted performance in the last five years. Our real estate investments have achieved an average return of 12%-15% per year in the US and 20%-30% per year in Europe and Eastern Europe. We are in the process of developing other Islamic products in different asset classes to offer our investors a wide range of Shariah compliant products.
What are the strengths of your business?
We are in a niche market and we offer something that cannot be found at other banks in the world. Our group has always operated exclusively in the Islamic banking sector and have a strong history as pioneers in this industry. We did not enter the Islamic banking field opportunistically but have been active in it uninterruptedly for the past 25 years, which gives us a certain level of legitimacy. Our group also has the culture of innovation within the Islamic banking industry. Recently we launched the first Shariah compliant real estate fund investing in the Central and Eastern European markets.
What are the factors contributing to the success of your company?
In any given business the key success factor lies among its people. We are a very strong team at FPB. It is also fair to say that we are in a field that grows at about 15%-20% per year which most definitely helps to overcome some obstacles.
What are the obstacles faced in running your business today?
Islamic banking is not yet appropriately understood in some countries.Some people believe that they can easily convert conventional products into Shariah compliant ones and do not quite understand what it takes and that the process, in case it is possible, does not allow any compromise. In reality this is a competitive hedge and can also be seen as a competitive advantage.
Where do you see the Islamic finance industry, maybe in the next five years?
Islamic finance will always remain a niche market in the global banking environment. Recent estimates show that its assets represent US$1 trillion, a substantial growth within a very short period from US$200 billion in 2003. This trend will continue, driven by demand in GCC and Southeast Asia. One of the most promising markets in Southeast Asia could be Indonesia. In an effort to position ourselves in this region, FPB is opening a representative office in Kuala Lumpur, as Malaysia is acknowledged as one of the most advanced markets in Islamic product structuring together with GCC countries.
Name one thing you would like to see change in the world of Islamic finance?
There is definitely a need for more consistency in the approach adopted by the different markets. This could give more credibility to the industry and improve clarity in the rules which is acceptable to all. It will also leave less room for interpretation. There are solid signs that we are heading in that direction but my guess is that it will be some time before this materializes.
Faisal Private Bank is the first Swiss bank exclusively dedicated to innovative wealth and asset management in accordance with the principles of Islamic finance.