Friday, April 19, 2024

Charting Oman’s Financial Future: Standard Chartered’s Approach

Charting Oman’s Financial Future: Standard Chartered’s Approach

Hussain Al Yafai
Chief Executive Officer and Head of CCIB, Oman

Hussain Al-Yafai is the Chief Executive Officer, Managing Director, & Head of CCIB (corporate, commercial, and institutional banking services) for Standard Chartered Bank Oman, a position he has held since 2019. In this role, he has executed a major restructuring of Standard Chartered Bank Oman to become the nation’s leading provider of corporate, commercial, and institutional banking services.
Hussain is a visionary CEO with a proven history of executing strategic initiatives, motivating teams, and driving profitability. He effectively partners with governments, government-related entities, financial institutions, and multinational corporations to provide financial solutions and services, and has been recognized by the Omani government for excellent service.
As a strong advocate for sustainability, Hussain established Oman’s first sustainability- linked financing and became the market leader in ESG advisory and ESG finance. Hussain has achieved over $75 billion in financing in Oman, boosting the national economy through debt capital markets, syndicated loans, ECA financing, and product financing. He draws on his extensive industry experience, market knowledge, and client relationship management skills to generate business growth. Since 2005, Hussain has held multiple titles at Standard Charter Bank, including Head of Wholesale Banking in Oman, Co-Head of Debt Capital Markets in the MENA region, and Regional Business Planning Manager of Financial Markets in the MENA region.
He also brings entrepreneurship and logistics experience from work with previous employers. Hussain studied Business Administration at the University of St. Thomas in Houston and at American University in Dubai. He is also certified in Behavioral Finance through INSEAD and developed robust leadership skills and a global mindset through multiple elite training and mentorship programs. Hussain was also recognized as one of the 100 most influential CEOs in Oman by United Press & Publishing LLC & SyndiGate Media in 2021. He is native speaker and Arabic and fluent in English.

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How does your past experience influence your outlook for 2024, and what is the critical element in your strategy to guarantee the success of Standard Chartered Oman?

Hussain Al-Yafai: Oman’s journey has been quite intriguing, particularly starting around
2015 when there was an oil dip. The trajectory began to shift from that point. However, I
would mark 2019 as the turning point. This period witnessed substantial structural
changes in the country, including the establishment of the Oman Investment Authority
and Energy Development Oman, and the introduction of the medium fiscal plan. The
implementation of the medium fiscal plan played a pivotal role in propelling the country

The implementation of the medium fiscal plan played a pivotal role in propelling the country forward.

Hussain Al-Yafai

From 2019 to 2023, we have seen the implementation of numerous several structural
reforms and the introduction and execution of various government initiatives. If you look
at the country’s ratings, it is on an upward trajectory, showcasing a strong turnaround in
terms of economic reforms. For instance, the debt-to-GDP ratio, which began at 7% in
2014, surged to 80% and now stands at 38%. The country’s primary focus is on
diversification, making Oman one of the few countries committed to an ESG strategy.

Going forward, the key is to strengthen these pillars and execute them effectively. The
opportunities are immense, with the government taking an active role in developing
infrastructure, particularly in the hydrogen sector, aligning with sustainability goals.
Additionally, the country is expected to experience a decrease in net borrowing due to
surpluses, with a prevailing trend of cutting along that notion.

Could you shed some light on Standard Chartered’s significant role in major
fundraising initiatives and its involvement in the debt capital market issues for
government, government-related entities, and corporations?

Hussain Al-Yafai: From the standpoint of Standard Chartered, we have been highly
engaged in the country’s financial landscape. Over the past 5 to 7 years, we have
facilitated more than $75 Billion in transactions, making a substantial impact. This
support extends across various advisory roles in capital markets.

Over the past 5 to 7 years, we have facilitated more than $75 Billion in transactions, making a substantial impact. This support extends across various advisory roles in capital markets.

Hussain Al-Yafai

To put it in perspective, we have taken the lead in 12 out of 13 sovereign issuances, essentially supporting the spearheading of  the financial activities of government entities in Oman specifically with Oman Investment Authority (OIA) verticals. The majority of structured debt raising, including ECA funding, senior unsecured debt, and project financing, has been orchestrated through Standard Chartered.

It is important to highlight that, as a branch of London, we stand as the sole international bank in the country. Our role is to be complementary to the local banking landscape; we do not compete with local banks but rather serve as bankers to them. This dynamic makes us a vital and active player in the financial sector.

Operating in multiple dynamic markets requires a keen understanding of diverse regulatory landscapes. How does Standard Chartered manage regulatory challenges and ensure compliance, especially in markets with diverse regulatory landscapes, and what steps are taken to align with local regulations in Oman?

Hussain Al-Yafai: We take compliance very seriously. We are regulated by the UK, and New York, and have major hubs in Singapore and Hong Kong. The entire industry is heavily regulated. Given our footprint in the Middle East, Africa, and Asia, we started prioritizing compliance decades ago, putting us ahead of the pack. Our regulators are very strong, and we work closely with them. In Oman, we have a dedicated team on the ground ensuring our regulations align internationally and locally, while also adhering to the directives of the local regulator.

The collaboration between Standard Chartered and China Energy Engineering Shanxi Electric Power Engineering Company (CEEC-SEPEC) in green financing, marked a milestone. Can you detail the joint efforts leading to the first green guarantee for the Oman solar project, and how does it underscore the bank’s commitment to sustainability?

Hussain Al-Yafai: This collaboration truly leveraged our extensive presence. It serves as a testament to our strategic approach as a network bank. Unlike local banks focusing solely on local businesses, we operate on a broader scale. Our footprint in Asia is extensive, and this inaugural green bond issuance exemplifies the strength of our network.

The cross-border business, whether originating from China, Indonesia, or Japan, is well-supported by our robust presence. We handle inbound mandates and facilitate businesses, offering support to both our clients entering these regions and Omani clients expanding either east or west through our offices. 

How does this collaboration contribute to the strengthening of economic ties between China and Oman? 

Hussain Al-Yafai: It checks all the boxes—the cross-border dimension, the collaboration between the two nations, and the ESG angle emphasizing sustainability. Standard Chartered has publicly pledged $300 billion in sustainable finance by 2030 and aims for zero emissions by 2050. This aligns with a bold statement we’ve communicated to the market.

What future opportunities does Standard Chartered foresee in fostering sustainable growth through international collaborations?

Hussain Al-Yafai: It’s a key pillar not just for corporations but also on how we conduct business. Collaboration is a must. I liken it to compliance 15 years ago; it was considered good to have, but now, if you are not compliant, you will face penalties.

The journey of sustainability and ESG is on a similar trajectory. It is something we need to address swiftly. Being on this sustainability journey not only aligns with our values but also brings pricing benefits. Looking ahead, countries and corporations may face penalties if they do not follow this path. As a financial institution, we have embraced this early, and I believe Oman and many other countries will need to do the same.

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