Few would have envied Muhammad Al-Jasser’s position, when he took the helm of Saudi Arabian Monetary Agency (SAMA) at the end of February.
Becoming governor of one of the region’s largest central banks, in the middle of a collapse in oil prices, and against a backdrop of a global credit crisis that was unsparing in its impact on the largest Gulf economies, the 54-year-old could have been excused a feeling of trepidation stepping into the long-serving Hamad al-Sayyari’s boots.
If he did entertain any doubts, he has not shown them. If anything, he has relished the challenges thrown up by the region’s financial turmoil, acting swiftly to limit the damage wrought on the kingdom’s economy.
Under Al-Jasser’s watch, SAMA has made it its mission to get banks lending again, implementing a loose monetary policy with a series of interest rate cuts this year. SAMA’s repo rate had fallen from 2% to just 0.25% by June.
Saudi banks have yet to increase their commercial lending significantly, despite the lowering of interbank rates, but Al-Jasser has ensured that the kingdom has achieved a soft landing.
“His standout achievement is the way that SAMA has managed the global crisis, employing counter-cyclical policies on the monetary policy front,” says Marios Maratheftis, regional head of research at Standard Chartered Bank. “SAMA has managed to ensure that the banks are still liquid, and that’s a significant achievement.”
Al-Jasser’s sure-footed handling of the aftermath of the financial crisis reflects his wide experience, including, for the past 13 years, serving as deputy governor at SAMA to Hamad al-Sayyari.
Educated in California, getting an MA and then a PhD in Economics from the University of California, Jasser started his career at the Ministry of Finance and National Economy in 1981, where he headed the Financial & Economic Analysis Unit at the Budget Department.
His career then took an international turn. He was executive director for Saudi Arabia at the IMF from 1990 to 1995, where he prepared a number of research papers and studies on fiscal and monetary policies.
This experience is reflected in the modern, cosmopolitan outlook of the governor, typical of many US-educated Saudi leaders. “He is quite happy to be spoken to by women and makes an effort to shake your hand,” says one female Saudi Arabia analyst.
But it is his sharp questioning mind that many identify as his defining characteristic; he often grills speakers at conferences for hours afterwards, relishing the discussion of the nitty-gritty of economic and monetary policy. “He is quite exceptionally knowledgable and smart as regional policy-makers go. He clearly knows his brief extremely well – SAMA is lucky to have him,” says Jarmo Kotilaine, chief economist at NCB Capital.
SAMA looks to be in safe hands as it faces another year of difficult economic circumstances. “He is a man of vision. He has the technical ability and the charisma,” says John Sfakianakis, chief economist at Banque al-Saudi al-Fransi.