Investment banking not popular among Gulf nationals

Gulf Arab states should invest in promoting investment banking as a career choice for graduating nationals because of the growing importance of the industry for the development of the region's economy, a senior banker said.

Majed Al Mesmari, a UAE national, who is head of financing solutions at boutique investment bank Rothschild Middle East, said there were too few nationals in investment banking.

"There is still a perception among the local workforce that working for government is a safer bet but they don't realise that the experience you get for a couple of years will set you apart in future," Mesmari told Reuters in an interview.

"Every corporate action, every major government initiative will in one way or another be influenced by investment banking professionals. They are such an integral part of the economy that they are effective players in determining its pace and direction."

From humble beginnings in Fujairah, one of the smallest of the seven emirates that make up the United Arab Emirates, Mesmari described himself as a "village person", and said he knew no other senior Emirati investment banker.

Most Arab financial services professionals in the Gulf come from more established banking centres such as Lebanon or Egypt.

Mesmari said he benefited from the insightful approach of his well-travelled parents towards education, at a time of few opportunities, and he began his career in local firms.

Before joining Rothschild over a year ago, Mesmari worked at HSBC's Islamic banking capital markets division.

"If you look at nationals in financial services, you notice clearly that most are working for banks, but particularly retail banking. It's a simpler and straightforward kind of profession."

"It is still quite disappointing that there isn't effective awareness programmes for... Emirati graduates to recognise the world of banking beyond retail banking."

The impact of the global financial crisis on the investment banking industry has been significant in more developed economies. But nascent Gulf capital markets have a healthy pipeline of bond issues and initial public offerings awaiting a turn in market conditions.

Mesmari noted that committing to long hours and lack of a social life may well deter youngsters in this part of the world, and says that cultural issues also play a part.

A few years in an investment bank could prepare future generations to better run their inherited family businesses, which still dominate the private sector, he said.

"There is a clear evolution of many family businesses towards better corporate governance, better financial reporting and more robust succession plans.

"Many well educated members of new generation will work directly in family business without having put their hands in the mud, without working as wheelers and dealers with organisations which will give them a better mindset in running their organisations in the future."