Combining his Western education with his Omani heritage and complimented by unwavering work ethic, Rashad Ali Abdullah Al Musafir has worked his way up to the rank of Chief Financial Officer at Bank Sohar. He shares his story of starting one of Oman’s newest banks and the lessons learned in the top finance job…
BORN THE son of a diplomat and businessman and educated at top universities, Rashad Ali Abdullah Al Musafir has always recognised his deep interest in the world of business.
After completing his first year in Economics at Boston University, Al Musafir saw an opportunity to expand the scope of his education. Instead of going for only one undergraduate degree in economics, he pursued a unique cooperative programme called BUCOP, which is a special package where a student can attain two different degrees and certifications at the same time.
Under this service, Al Musafir added Finance as his second major with a specialisation in Business Administration.
“Getting the combination of Economics and Finance was perfect for business. You need to understand what is happening to the markets, both locally and globally, and then you need to be able to understand what is happening from a financial perspective to the company. I would later add accounting to this mix, which I believe has been very helpful in regards to my career,” says Al Musafir.
A unique perspective
Immediately after finishing these two degrees in the States, Al Musafir returned to Oman to the Central Bank to handle regulatory returns and the licensing of banks and branches.
“I was working hand in hand with the top management of the banks and oversaw their licensing of branches and their financial positions. This gave me a unique perspective to what was happening in Muscat at the time. You need to be in an environment that helps you learn, facilitates your development, and helps create the bedrock of your future. This was what happened for me at the Central Bank in those early years, where I was able to get the needed exposure and strong networking opportunities.”
He reflects that with his education in economics he had a solid understanding of what the banking sector was doing, and with his education in finance he understood the actual business of banking.
After his time at the Central Bank, he was hired at Oman International Bank in the accounting department where he took on new responsibilities that included managing a small team that handled all of the central banking reports. It was then that he realised he needed a stronger understanding of accounting to become globally competitive. Despite being recently married and having his first child, Al Musafir decided to set aside time to pursue a CPA certification.
Power of CPA
When Al Musafir sat for the CPA exam in 2002, it was required to write all four papers over two days, beginning at 8am and finishing at 5pm. Because the CPA is a US based certification, and he had to take the exams in the United States, there were topics which required us to know a lot about US regulations and US accounting and tax laws; all of which would be foreign to Al Musafir.
He overcame these bumps in the road and passed the exams. Al Musafir gives this advice about the CPA: when considering an attempt at this certification, he suggests to do as much reading as possible before enrolling, to test the waters a bit and try things slowly. He acknowledges that many people believe it to be too complex, but he encourages those interested and says “it is not impossible, just start slowly and take your first few steps. It won’t take long before you will see value in what you are doing and you will begin to enjoy the learning process.”
“It was tough, the exams were grueling and I had a full time job and a family to raise. In between all of this I had to find time to study. That is where the real gift of the CPA is, not in getting the certificate but in the studying, in the actual learning of the accounting principles. Once you learn these concepts and then you start applying them in your job, you will get great satisfaction,” says Al Musafir.
Natural progression
Upon completing his CPA, he was called upon to join and help establish a new insurance company, Al Madina Gulf Insurance Company. Al Musafir became the financial controller there, but soon realised that insurance was not his cup of tea. However, he picked up valuable experience in every aspect of operation that polished him to a shine, a new coin to be picked up by Bank Sohar in 2007.
“By this point I had picked up all the necessary experience, from working at the Central Bank and understanding the regulations, to getting Green Field experience with the insurance start up, to having an academic pedigree that spanned economics, finance and accounting. So I felt it was a natural progression to do the start-up of Bank Sohar,” says Al Musafir.
In April 2007 the Central Bank of Oman raised the minimum capital for new banks to 100 million rials, and the shareholders of Bank Sohar, which comprises of a consortium of government and private investors, and the founding committee headed by a leading business man Salim Macki, made it happen. When Bank Sohar opened, there had been a dearth of new banks despite numerous mergers and acquisitions. People were hungry for fresh ideas and innovation, and the founders of Bank Sohar answered that call with new products and services.
They started with OMR 100 million authorised capital and have become the fastest growing bank in last six years in Oman. Despite losses in the first two years of operations, they quickly turned profitable in the third and their credit growth significantly increased.
In 2009, Bank Sohar invested in Al Musafir and sent him to Harvard Business School for a four month intensive programme called the General Management Programme. This course prepares executives for larger leadership challenges, by equipping them with new skills in leadership, business strategy, and best practices in management.
A devastating loss
During his professional success, Al Musafir’s mother had fallen ill with cancer. Even though he was working long hours at the new job, he made time to take her abroad for treatments and spent most of his spare time with her. In 2009 she succumbed to her illness, but Al Musafir did not fall into depression.
“The toughest thing I have ever been through was the death of my mother. She was so young to die at the age of 65. There is no way to prepare for the loss of a loved one, especially your mother. Trying to manage everything and deal with such a devastating loss was tough. The only way I got through it was with the support of my family. There was a lot of support and a lot of gatherings. That is one of the positives of life in Oman. Family is big here and my family is really close,” says Al Musafir.
He says that his mother was “always an advocate of education, faith, and positive thinking. She had been in the education field all her life and was very much loved by her family, friends and all those who had come across her, and with that in mind she always told us to always be positive, no matter what happens; it’s all written in the books. Your destiny is set so your best strategy is to be optimistic, to be positive.”
After his mother’s passing, Al Musafir realised that he would have to make the most of every moment he had.
He reflects, “My mother passed away at a relatively young age, so one of the things I learned was that you don’t get to live forever and you need to experiment and do things in life. Don’t procrastinate. Don’t be passive. Now I travel more and try new things, I am more open to taking risks than before.”
Strategy for success
A similar challenge appeared in Bank Sohar – how to effectively organise the company for productivity and success and how to avoid letting projects drift over long periods. Al Musafir and his colleagues wanted to create a strategy for success without imitating anyone else’s. He says there were “no maps, no ground rules” when they began so they as a team created all procedures and policies. By studying how other banks operate, they assembled a new plan in order to meet the vision for the founders.
Due to this innovative approach, Bank Sohar has succeeded and exceeded expectations. In six years, the bank has grown to 588 employees from just over 100 staff when the bank opened its offices in April 2007, and has grown to OMR 1.79 billion in assets from a small 159 million 2007.
“We are growing from strength to strength under the visionary leadership of Dr Mohammed Kalmoor, the CEO of the bank,” says Al Musafir.
Aside from their brand-new business plan, one of the keys to their success was a focus on efficiency. Rapid growth can cripple an unprepared business, but Bank Sohar finessed this progression by leveraging three main areas: IT, Centralised Operations and Risk Management.
Growth of Islamic banking
In addition to those manoeuvers, Al Musafir stresses the importance of having a solid recruitment team to hire qualified and effective people without any excess.
To keep things efficient, the CFO says the core team will not increase by much in the coming months, but they will be hiring as they add new branches. The focus now is to grow their Islamic banking window, Sohar Islamic. The bank now has three Islamic banking branches and expect to open more in the coming years. He says that the Islamic window is practically a bank within a bank because it has its own staffing teams, core banking system, and infrastructure and most of it is entirely independent.
If this sounds new, you’re right to think so. It was less than two years ago that the Central Bank of Oman allowed Islamic banking to set up shop, but already it has attracted many new clients at all the major banks who have opened Islamic windows.
“It’s a small market and [it’s] tough for everyone to come in at the same time,” Al Musafir says.
Right now he is most concerned with keeping the business growing in this new era.
Weakness in accounting
Al Musafir believes that accounting is the core of any business. He believes that the SME in Oman is struggling because of weakness in accounting.
He says, “Without the knowledge of accounting, it’s like driving in the dark: if you can’t see where you are, you won’t know where you are heading. You have to know your cash flow position and what your future earnings will be in order to optimise your growth. Even worse you could run into a cash flow problem. This is something a Chartered Accountant can do for you. Problem is, there are very few Omani Chartered Accountants in the landscape. The number is growing, but very slowly. Historically we have imported our accountants from the Indian Sub-Continent.”
It is predicted that the local populations of Oman and other GCC countries will see a sharp increase in the number of qualified professionals such as Chartered Accountants in the next five years and Al Musafir believes this will drive economic growth and stability in the region.
He encourages his staff to get certified in accounting despite the stereotype that it is boring or only for those in the field of accounting. He agrees that indeed it is basic, but in the way that tyres are a basic part of a vehicle.
He explains, “Without tyres, the vehicle will not move,” and without accounting you won’t be able to go very far. Accounting is the language of business and one of the stepping stones of executive management.
Investing in yourself
Al Musafir does not hesitate with his first piece of wisdom: “Sacrifice time to invest in yourself. Develop your capabilities and opportunities will come. What is the point of having an opportunity you can’t capitalise on because you are unqualified? The Oman market is teeming with opportunities but the problem is finding qualified Omanis. It is true we have developed faster than most GCC states and in fact have one of the most qualified local workforces in the region. So we are moving in the right direction, but we still need more Chartered Accountants, especially Omani nationals.”
He explains that professional certifications and qualifications don’t come easy, but one must invest time and effort to push themself into more education. He warns that this becomes more difficult as one ages, and it is much easier to do these things at a much younger age. He however says that that shouldn’t stop older executives from furthering their education, saying as a married man with four children, he has achieved two advanced certifications while working.
Future of Oman
But what it boils down to, Al Musafir says, is the real work, not just the plaques that signify certifications and degrees. He states that, “The largest benefit I got out of my certification was during study time, not at the time I received the certificate. The certificate is only a piece of paper that you receive at the end saying you’ve done the work. What is important is the actual work. That’s where you gain the most knowledge and insight.”
When asked about the future of Oman and the accounting profession Al Musafir says; “to me this is the land of opportunity.”
“Oman is growing rapidly, and we have not suffered the way other countries have during the financial crisis. We are investing heavily in our infrastructure, and are developing in all sectors. I believe there is now more opportunity in the market than ever before in history. For example, Oman witnessed the opening of its first fully fledged Islamic bank, Bank Nizwa and the second one, Bank Al Izz, is about to open. We have billion dollar tourism development projects under way and an SME sector that is ready to rise and contribute to the economy. So wherever you look you can’t help but feel confident about the future of this nation,” he proudly says