Kuwait's top woman banker on weathering the 2008 crisis
Maha Al-Ghunaim co-founded Global Investment House by innovating and boosting research
Kuwaiti investment banker Maha Al-Ghunaim may not be ubiquitous on Bay Street, but in financial circles in the Middle East, she’s a superstar.
She and four friends founded the Kuwait’s Global Investment House in 1998 and have built it an investment bank with $3.7 billion under management. She has made the Forbes list of top 100 most influential women and is among the top 10 Arab businesswomen.
But more importantly, she has steered her relatively new investment house through the 2008-2009 financial crisis, when it saw its assets under management halved amid a critical cash crunch.
“I remember when we first started in the 1980s, there were very few women in the business world and the investment world... Even in the family businesses in Kuwait, it was very rare that you would see the daughter - GIH managing director Maha Al-Ghunaim
“The financial crisis hit everyone around the globe and it didn’t matter if you were on the 1st floor or the 30th floor, you felt the effect of that tsunami and it’s also not due to just outside external factors, but also some mistakes that we encouraged in the way we do business,” Al-Ghunaim said in an interview with CBC’s Lang & O’Leary Exchange.
Al-Ghumain had invested in the phenomenal boom in the Middle East and found the bank over-leveraged when the crisis hit. Its principal business was at a level “not suitable to our short-term liabilities,” she admits.
“So when the financial crisis hit us we found ourselves in the middle of liquidation disasters to pay off our debts and simultaneously organize Global International, regionally or locally.”
Al-Ghumain had begun the bank with four colleagues from the investment banking world and was able to build it by offering funds and investment instruments that were new to the region, including index funds and fixed income funds.
She said she set out to make GIH different from other regional brokerages and asset managers by concentrating on research and innovation.
“I think when we created Global, we wanted to make a difference. We widened the capital markets rather than everybody competing for the same slice – make the pie larger. We started to create very new funds and products,” she said.
Her focus is still on the Middle East and she is bullish about prospects for the region, despite the sharp correction of 2009.
In conservative Kuwait, where only 15 per cent of women are in the workforce, compared to 73 per cent in Canada, Al-Ghunaim often stands out as the only woman in the room.
But that’s changing, she said.
“I remember when we first started in the 1980s, up to 1990 which was the invasion of Kuwait, there were very few women in the business world and the investment world. Also, I had relationships with a lot of family businesses – even in the family businesses in Kuwait, it was very rare that you would see the daughter,” said the mother of four children.
“And now 20 years down the line, meetings that I go to to see my clients, sometimes you would see the daughter sitting on the right hand side with her father. And we’re also seeing a lot of women moving up the ladder career-wise in a lot of the banking institutions and the large institutions in Kuwait. “
Al-Ghunaim studied mathematics at a U.S. university and had very little business knowledge when she joined an investment arm of the government of Kuwait, known as the Kuwait Investment Authority, after graduating.
“That gave me huge exposure, they did a lot of transactions and at that time they really took care of young Kuwaitis who were entering the workforce, so they trained us well,” she said
“I started from the bottom and learned how things are done and gradually moved my way up the ladder. I think the two most important reasons for my success were: I was passionate about learning and enjoying what I was doing and that gave me a lot of drive to continue to learn and the second issue is that I had to read a lot and commit to the task, rather than just ride the wave.” Al-Ghunaim added.