David Proctor: The banker who can’t get out of Qatar

"Nightmare over” for UK banker held in Qatar 
Euromoney, April 30 2010 

Qatar? Be warned
Sydney Morning Herald, February 10 2010

Qatar overhauls financial centre’s strategy 

Euromoney, February 1 2010

Qatar changes tack to boost financial centre
Financial Times, February 1 2010

The dangers of working in Qatar
The Independent, January 27 2010

Banker's 12-month ordeal as 'hostage' of Qatari sheikh
Daily Mail, ‎January 19 2010‎

UPDATE: Nightmare over” for UK banker held in Qatar 

April 30, 2010

DAVID PROCTOR’S biography as a career banker remains proudly displayed on the website of Al-Khaliji Bank, the three-year-old Qatari bank where "we pride ourselves in finding ways to do things differently".

Outwardly, there’s nothing particularly unusual about that. Bank executives often have their CVs puffed on the ‘About us’ tab of their banks’ websites. And Gulf banks do it often, both projecting a progressive image and boasting about the foreign talent they’ve lured to modernize their oil and gas-drenched emirates as emergent financial centres.

And what bank, particularly an ambitious start-up like Al-Khaliji with regional ambitions, wouldn’t puff a CV like Proctor’s? He’s Cambridge-educated, 25 years a banker, solidly trained at Midland and then with a long stint at Bank of America, rising to be its boss in Bangkok, where he chaired the foreign bankers’ lobby during the 1990s Thai financial crisis. In 1999, he made a move to what would seem the natural habitat of this Peterhouse alumnus, Standard Chartered, as its global head of client relationships. He was made CEO of StanChart’s European group, then its boss in the Gulf until 2006, and was a favourite of its former executive chairman Mervyn Davies – now Baron Davies of Abersoch, Britain’s minister for trade and investment.

Indeed, as Al-Khaliji gushes of its "special adviser to the chairman and managing director", Proctor’s "breadth of understanding of the banking market – honed in the course of his 25 years in the industry – has equipped him as a natural leader with a proven track record of success at all points in the economic cycle". Proctor reads as a combination of process man and safe hand, combining emerging market exotica with the ambassadorial polish of an international banker. His experience leasing planes, ships and oil refineries would also seem perfect for the resource-rich Qatari story.

So, what’s wrong with this picture? And why should anyone care?

Because as with much in this reclusive, gas-rich Gulf monarchy, one of the world’s richest yet least transparent countries, not everything is as it appears. Proctor’s "special adviser" designation on the Al-Khaliji website seems as phony as what many anxious foreign bankers and businessmen in Doha posit is Qatar’s genuine commitment to due legal process. Qatar widely advertises a "world’s best practices" mantra but that is increasingly questioned internationally of financial centres across the Gulf as once-soaring Arab ambitions dissolve in a desert storm of bad debt and finger-pointing.

But Qatar’s claims to openness and transparency are questionable in Proctor’s case. Search the Al-Khaliji website and there is no official announcement that David Proctor is no longer the bank’s CEO. The only public pronouncement on the matter was a statement posted on the Doha Securities Market’s website in March last year announcing his new position as special adviser. No reasons were given for the sudden change.

Moreover, Proctor – hired in February 2007 to create and build government-controlled Al-Khaliji into Qatar’s first regional bank – hasn’t actually provided any advice or management for almost a year, not since Sheikh Hamad Bin Faisal Bin Thani Al-Thani was installed as the bank’s new chairman in February last year. Proctor appears to be caught in a power struggle within Qatar’s ruling elite over control of the emirate’s emerging financial sector. A senior member of Qatar’s remote ruling Al-Thani family, Sheikh Hamad is a former colleague of Qatar’s powerful finance minister Yousef Hussain Kamal. The sheikh was Kamal’s recent deputy at the finance ministry and is himself a former commerce minister. The wealthy Kamal is a prominent businessman in the emirate. He’s best-known for his long-time chairmanship of the country’s biggest bank, Qatar National Bank, an Al-Khaliji competitor. His former vice-chairman at QNB? None other than Sheikh Hamad.

A long way from home

Since his ouster from Al-Khaliji last March, Proctor has been trapped in Doha against his will. He’s been denied a visa to leave, his living conditions reduced to a month-to-month tenancy of a one-bedroom flat. He drives a borrowed car, communicates by pre-paid SIM cards and Skype, and has an uncertain future. Separated from his young family in Singapore – he has seen his new-born son for just two weeks, when his wife Trinh visited him in October – Proctor is unable to work or earn an income in Qatar. He is steadily going broke, and is under considerable psychological pressure. Although he frets that his movements and possibly his conversations and electronic traffic are being constantly monitored by Qatari security services, Proctor is under no personal restriction or formal house arrest by any Qatari authority. Proctor is able to go wherever he likes within Qatar’s sandy 11,000 square kilometres – he just doesn’t have permission to leave the emirate, return to his family and resume normal life.

His small support group of sympathizers in Singapore, Britain and Australia insist there are no formal legal proceedings against him. The only suggestion of anything wrong comes from Al-Khaliji’s Lebanese-born investor relations officer Charbel Cordahi, who in December told Euromoney that there were "external investigations pending", without providing evidence or details. In September, the British government said they were advised by Qatar’s attorney-general that Proctor has no legal case to answer in Qatar. In December, the Foreign Office told Euromoney it believed that to still be the case.

Over the Christmas period, Euromoney learned that Proctor’s lawyers had informed him that Qatar’s public prosecutor had said it was unwilling to issue him with an exit visa. As his desperation increases, friends of Proctor say he may soon have little option but to seek the sanctuary of the British Embassy in Doha and try his chances from there.

So why can’t David Proctor leave Qatar?

No one in Doha seems willing or able to say. Al-Khaliji’s Cordahi told Euromoney that he’s "too scared" to talk about Proctor’s plight for fear of personal impact on him at the bank. Ex-staff talk of a "climate of fear" at the bank. Sheikh Hamad and Proctor’s successor as CEO, South African Robin McCall, refuse to respond to questions about Proctor’s status, or to key questions about the bank’s accounts under their management, as do the various board members sprinkled across the Gulf. The Qatar Central Bank and finance ministry also don’t respond to questions, nor do Qatar’s legal authorities.

David Proctor is mired in some indeterminate legal purgatory. His own efforts to find out why he is stuck there have been rebuffed. Over the course of three months investigating his case, Euromoney has made numerous attempts to discuss his status with Qatar’s central bank, its finance ministry, the prime minister’s office, the public prosecutor, and executives and other board members at Al-Khaliji. Most requests for information or interviews have been ignored. Among Qatar’s well-remunerated, there-but-for-the-grace-of-God-go-I expatriate business community, what’s happened to Proctor is a phenomenon euphemistically known as "going to China", something best not discussed because you might be next.

Conversations in Doha’s few expat haunts – the Harp, the Irish pub at the Sheraton, if you’re British, or the ‘cholesterol corner’ strip mall of chainstore eateries for American taste, or the W Hotel’s Crystal Lounge if you’re young, chic and culturally ambiguous – have been going like this in recent months:

"Anyone seen David Proctor from Al-Khaliji?"

"He’s gone to China."

"Really? What happened?"

"Not sure. Another round?"

Qatar’s foreign detainees

The "Chinese" nightmare endured by Proctor is one of many similar dramas facing foreign bankers and businessmen in Doha, Dubai and elsewhere in the Gulf in the aftermath of the global financial crisis. He is just the latest in a lengthening list of foreigners who have somehow found themselves on the wrong side of a powerful Qatari in a tradition-bound and secretive monarchy where important sheikhs can never be wrong.

Qatar Airways executive Ian Heywood spent much of 2008 "in China" after he was headhunted to a job at British airline BMI after a year in Doha. On May 1 2008, during his notice period, he was detained by Qatari police as he was boarding a return flight for a business trip to Bahrain. Then he disappeared, without any contact with his distraught family. It was eight days before Qatari authorities told the British embassy he had been detained and another three weeks before he was released from solitary confinement. There were hints of industrial espionage – Heywood’s family insisted he’d done nothing wrong but the British government said it couldn’t intervene. Eventually a case of "breach of contract" was brought against him by Qatar Airways, but six months later it was thrown out after a brief hearing. Heywood left Qatar in December 2008, his BMI job filled months earlier, his career in tatters.

Then there was the case of the Belgian Philippe Bogaert, a broadcast media specialist. He was denied an exit visa by his Qatari sponsor when a business deal with a government agency went sour in 2008. Bogaert publicly claimed he was "held hostage" for 13 months, even though what he says was a confected criminal case against him was thrown out in November 2008. Near-penniless, Bogaert had moved to the Belgian Embassy in Doha, becoming a curiosity around town by busking in malls to earn money, and on the internet with his hostageinqatar.com blog.

His departure in September last year is the stuff of derring-do. A support group hired a yacht to give the appearance they were on a recreational sail around the Gulf. They moored in Doha, Bogaert was smuggled on board and the boat sailed on its festive way. It was only when it was outside the Gulf, in the genuinely international waters of the Arabian Sea five days’ sail from Doha, that Bogaert first felt comfortable to appear above deck. He made it to India and now, reunited with his family in Belgium, is writing a book about his drama. "The Qataris are unembarrassable," says Bogaert. "They have more than $100 million coming out of the ground every day which means they think they can do what they want."

Tracy Edwards is another who fell foul of the Al-Thanis. The world champion British yachtswoman was bankrupted after a $15 million deal with the Al-Thanis to promote Qatar as an international yachting centre went sour. She wasn’t able to leave the emirate for a month. Her take on Qatar? "Get a flight to Dubai, Abu Dhabi, Oman, Bahrain, Lebanon, Jordan, Saudi or in fact anywhere else except Qatar. If you still feel compelled to make your life significantly more complicated and experience the wonderful and as yet unexplored world of ulcers and drinking Gaviscon direct from the bottle, then by all means head to Doha."

Proctor’s plight is known among Doha’s tight-knit banking community. In October, as Euromoney did the rounds of bankers and regulators at the Qatar Financial Centre – one of whom suffered a similar drama in Dubai – his dilemma was clearly an open secret: after all, he was one of them only a few months earlier. But his are circumstances bankers only discuss off the record and even then very gingerly lest walls have ears. One Australian banker said what was happening to Proctor was a "fucking disgrace"; the British long-time CEO of a local bank echoed his sentiments in slightly less colourful language.

That Proctor’s plight is not well-known outside the Gulf seems to suit the Qatari authorities, who care deeply about how the country is perceived in the outside world as it tries to broaden its economy for a post-resources future.

In recent years, Qatar has emerged as a pivotal player in Middle East politics, which pleases its Western patrons if not always its Arab neighbours. It has brokered the Doha Agreement between warring Lebanese factions, and has sought to mediate an end to Sudan’s Darfur crisis and an emerging civil war in Yemen. Since 2003, it has been the headquarters of the US military assault on Iraq, waged from the Pentagon’s massive Al-Udeid military base.

Tiny Qatar has ambitions to be big in world sport too. It hosted the 2006 Asian Games, which was dogged by dramas and maladministration. It bid unsuccessfully for the 2016 Olympics and has lured several foreign athletes with massive deals to change nationalities and compete for Qatar (although that strategy has brought little Olympic success, yielding just two bronze medals in seven Olympics). Today, Doha’s broad avenues are festooned with bunting touting Qatar’s ambition to host the 2022 football World Cup.

But the most important part of its makeover is its ambition to be a global banking centre. In 2005, it set up the Qatar Financial Centre in a tower in Doha’s West Bay district. Some 70-odd foreign and local firms have since been drawn to the QFC, which promotes a mostly British-inspired financial legal system as an alternative to Qatar’s Islamic Shariah-based law. Some lawyers say its very creation suggests the Qataris know their traditional legal system is ill-equipped for a modern financial services centre. Desmond Holmes, the QFC’s managing director of business development, says the "vision" is that the largely untested QFC jurisdiction will eventually spread beyond its building and overtake the emirate’s legal system. It’s still early days at the QFC, but most of the new arrivals seem to be modest representative-secretary-and-the-tea-lady affairs, ostensibly "rep" offices to enable more convenient dealmaking in the region. The QFC lists "10 reasons to choose" its system, citing Qatar’s fast-growing economy and world-record GDP per capita, the gas reserves and the $130 billion investment plan for the country. In point nine, the QFC specifically boasts that it has its own immigration and employment laws – which in theory means that a foreign banker should be able to work in Qatar and not end up in "China" if things go awry.

But that’s cold comfort for David Proctor, hired outside the QFC environment.

Proctor had been headhunted from StanChart in Dubai to create the bank in early 2007, lured by the then chairman Tariq Al Malki, an adviser to Qatar’s prime minister Sheikh Hamad bin Jassim bin Jaber Al-Thani. The prime minister is a cousin of Qatar’s long-ruling emir and is one of the country’s richest men. He controls the flag-carrying Qatar Airways, and is also executive chairman of the Qatar Investment Authority, the sovereign fund set up in 2005 to secure an economic foundation for Qatar for the still far-off day when its massive natural gas reserves – tiny Qatar controls the world’s third-biggest reserves after Russia and Iran – are exhausted. That fund invests the $180 million-a-day earned from those gas fields and now controls about $60 billion in assets, including big stakes in UK retailer Sainsbury’s, German carmaker Porsche and London’s Songbird Estates, which owns much of Canary Wharf.

The prime minister is seen by diplomats as a business and political rival to finance minister Kamal, a banker and gasman, and another of the country’s richest men. In what could seem a conflict of interest in the west, Kamal is also the long-standing chairman of Qatar’s dominant commercial bank, state-owned Qatar National Bank (QNB), which controls about 50-60% of the Qatari banking market and often acts as a de facto central bank for the emirate. The law of conflicts in Qatar are more uncertain.

Says a foreign banker in Doha familiar with Al-Khaliji: "The finance minister absolutely hated that Al-Khaliji was established, because the prime minister was delving into his patch." Mr Kamal did not respond to Euromoney’s questions about Al-Khaliji.

The chance of a lifetime

For Proctor, going stale at StanChart in Dubai, Al-Khaliji had presented as an exciting proposition when he was asked to come on board: a multi-million dollar salary and $2 billion in capital to build the bank with. There would be shareholders from all the economies of the Gulf Cooperation Council except Saudi Arabia, not just the financial backwater of Qatar, where the banking sector is massively overshadowed by the hydrocarbons behemoth and QNB.

However much "cooperation" is notionally stressed among the six members of the Gulf Cooperation Council, the old tribal rivalries of the region are hard to erase and banking can be parochial. But here, as Proctor saw it, was a chance to re-draw the Qatari financial map in line with the modernizing message the emirate seems keen to portray internationally, and create a bank built to international standards, world’s best this and that, adhering to the various international protocols – a "new generation bank" as Al-Khaliji continues to claim.

It was that vision that lured Proctor. His associates say that had it been a pure domestic bank, "it would have been much less interesting" for this experienced banker.

There was a third rationale behind Al-Khaliji. Some 80% of the Qatari economy is resource-based, and nearly 100% of that is export-oriented. Project financing is pretty much the only reason why foreign banks have been present in Qatar and there was rumoured to be increasing resentment among the tiny domestic banking community that the best deals went to overseas banks. That Proctor was experienced in project finance and leasing from his time at Standard Chartered speaks to that theory: he was no retail banker.

And there was a fourth equally plausible reason to usher in a new bank. Qatar’s economy is effectively a cartel divided up among members and aides of the Al-Thani family. Qatar is ruled by discretionary decrees, loosely making up a monarchy. But with Gulf orientation, Al-Khaliji was portrayed as very different from domestic-focused Qatari banks. It was seen and sold to Proctor as providing genuine competition to Qatar’s old family empires. Through 2007-08, Proctor assembled a team of 30 foreign executives from 20 nations, and set about meeting the vision for the new bank. He had a brief to make Al-Khaliji – the name is the Arabic term for the Gulf – Qatar’s first genuine regional bank. Directors and shareholders signed on from Dubai, Oman, Bahrain, Lebanon and Kuwait, and by mid-2007 Al-Khaliji had gone public on the Doha Stock Exchange in an IPO.

Life seemed pretty good for Proctor. Socially, Doha and its 50-plus degree climate can be dire but Proctor was well-paid and, after a horror period in the very basic company lodge, moved to a new home with his wife Trinh. And there was a new Porsche, the Ritz-Carlton gym, the yacht club and the dinner party circuit to embrace, where the unfathomable intrigues of the emirate were often discussed.

Al-Khaliji launched its corporate operation in August 2007, an Islamic business, at end of that year, as per banking’s trend of the day, and a retail business in June 2008. The retail side was slower than Proctor had hoped but there was a struggle to find locations for branches, with the bank bumping up against Qatar’s then massive building boom. Branch sites were also too expensive, and for contractors and fitters there were richer pickings elsewhere. According to an insider, the bank also had big trouble with its IT systems – ATM, online banking, connecting branches – and went through a succession of consultants – and $100 million – before getting it close to right after US bank IT expert Steve Shipley was signed on as troubleshooter. Bank insiders say Sheikh Hamad is now going through the procurement contracts with a fine-tooth comb to unearth any possible wrong-doing.

The deal that Proctor hoped would take his tenure at Al-Khaliji to a new level came about only 18 months ago.

In 2005, the Qatar government acquired control of the small Paris-based Banque Libanaise pour le Commerce for $236 million from the Lebanese central bank, which had bailed it out in 2002. Founded in the 1950s, BLC catered to France’s Lebanese community and had reach into the Gulf via branches in four key UAE emirates, where it also catered to Lebanon’s far-flung diaspora.

The UAE is the six-country Gulf Cooperation Council’s biggest market outside Saudi Arabia and Proctor was keen to cement his new bank there, as befitted Al-Khaliji’s Gulf-wide brief and name. But GCC member economies issue only one banking licence per country and, for Qatar, Doha Bank had that licence, not the dominant Qatar National Bank as might have been expected. Proctor moved to buy BLC from the Qatari sovereign fund. In November 2008, Al-Khaliji secured BLC from the QIA for $250 million, enabling Proctor to get set in the UAE by the back door.

The deal was also a coup for Tariq Al Malki, Al-Khaliji’s then chairman and an adviser to the prime minister. Al Malki was then on the board of the QIA. With BLC, Proctor had the base to build the full regional bank that was his remit.

All change at Al-Khaliji

Then the global financial crisis changed everything.

As the full impact began to bite in late 2008, Qatar and its banking sector was confronted, as in most countries, by cashflow issues as liquidity dried up. New banks need cash to grow, and the fast-expanding Al-Khaliji didn’t have as much of it as before. With asset values plummeting, Qatar’s anxious emir entrusted the emirate’s external business affairs and sovereign fund to his prime minister, who is also Qatar’s foreign minister. The domestic economy was left to finance minister Kamal, and there ensued a $5 billion-plus series of stabilization moves by the central bank. In February, Al Malki was removed as Al-Khaliji chair and replaced by Kamal’s old underling at finance, Sheikh Hamad.

Still, sudden though the global financial crisis was for Proctor’s team, management overhaul is as common in the Gulf as elsewhere. But Proctor knew the game was up. On Sheikh Hamad’s first day as chairman, Proctor told his new boss there could only be one leader of a bank. He explained that as the sheikh was a Qatari, and an Al-Thani no less, and as Proctor was a foreigner, "let’s just agree that this doesn’t make sense". Says an insider: "There was no point saying it any other way. He was an Al-Thani, he was the big cheese." Friends of Proctor say he had decided it was time to move on. "It wasn’t done in a confrontational way," the insider says. "It was simply a matter of fact. The game had changed, and this was the best way to move forward. "

But Al-Thani was apparently blindsided, reacting that he knew little about Al-Khaliji and he needed Proctor to stay around. Proctor decided to bide his time with the new arrangements but it soon became clear his tenure was doomed so he moved to negotiate a termination of his services in February 2009.

As Proctor negotiated exit terms, he closed his affairs and spent much of February and March on gardening leave in Doha awaiting Al-Khaliji’s paperwork and severance before moving on to the arms of a headhunter. And waited, and waited some more. Relations with the sheikh outwardly seemed cordial and Proctor was wished well, with a hope of working with him again in the future.

There was nothing to suggest anything was irregular or untoward, but the paperwork simply didn’t arrive as promised. Far from paying him a severance and bidding him farewell, Al-Khaliji’s new chairman Sheikh Hamad has refused not only to pay what was agreed to Proctor, he has also refused him permission to leave. In the difficult months that have followed, Sheikh Hamad simply refuses to engage with Proctor.

Sources close to Proctor say that he is concerned that Al-Thani’s root and branch review of supply and procurement contracts may in part be designed to unearth a reason not to honour the standard terms agreed with Proctor. His camp say the terms concerned an amount of money "but not enough to retire on". The sheikh made life hard for others in Proctor’s team: the head of IT, Steve Shipley, had to pay back his $500,000 signing-on fee before his passport was stamped with an exit visa.

In a previous job in the Qatari civil service, Al-Thani was the head of the customs service, part of the finance ministry, where it is believed he cemented links with finance minister Kamal. A Proctor supporter says: "In his mind he’s a straight-shooter, protecting the rights of Qatar from all these foreigners who are trying to rip the country off."

In their increasing desperation, and in view of the lack of response from Al-Thani, Proctor’s camp have searched for reasons why the exit visa wasn’t issued and why he has effectively been held hostage in Qatar. They liken his detention to a cat playing with a stricken bird.

Bank staff were unhappy at not being paid bonuses after working hard during a difficult 2008, money being the point of being in Doha for the expatriates. Australian banker Michael Priestley in corporate at Al-Khaliji had taken a staff loan to buy a Porsche, but when the bonuses weren’t paid he made for the airport, left the car in the car park, left on a plane and sent the keys back to the office in lieu of the loan. This incensed Al-Thani when he learnt about it and he immediately cancelled all exit visas for the foreign staff, which made up 80% of the bank. Thereafter any staff member wanting to go abroad needed to get personal approval from the sheikh. On one occasion during this February waiting period, however, an unwitting Proctor made a social visit to Dubai, a 45-minute shuttle away, returning without incident a few days later to Doha. His supporters say that if he had had any inkling of what was to come, he would have flown on.

His party believes the only possible way of fixing this is the time-honoured regional way – money and possibly a darker version. Except, as an experienced global banker, a former CEO with a reputation to uphold and a career to resume, any action which does not comply to international standards is not an option for Proctor. A supporter says: "You do it once, you can never be on that other side again." Proctor has offered to pay back various fees and bonuses but the offers have been ignored.

It is not clear what role if any Kamal or others played in the due process problems Proctor has experienced. All attempts by Euromoney to reach Kamal, Sheikh Hamad, the prime minister and the emir’s office have been ignored.

The only remark from any Qatari entity directly addressing the Proctor matter comes in an email from the bank’s investor relations officer, Charbel Cordahi: "With external investigations pending, we are not authorized to respond to your questions, neither by the board of directors, nor the governmental bodies involved in the matter. Further, please take note that, under our applicable legal and regulatory regime, we are not required to disclose any of the purely internal and confidential information requested by you to any third party." David Proctor’s supporters categorically refute there is any outstanding legal matter before him concerning his tenure at the bank.

A bailout by any other name

After the unexpected cataclysm that has been the global financial crisis, it is a very good question for us all – what are "normal market conditions"?

Al-Khaliji’s quarterly reports for the first three quarters of 2009 make for fascinating reading. The Q1 report, prepared by Deloitte’s local audit partner Muhammad Bahemia and the first one signed under the new chairmanship of Sheikh Hamad and Proctor’s successor, the South African acting CEO Robin McCall, shows Al-Khaliji having posted a net profit of QR51.7 million ($14.2 million). That’s more than seven times the $1.93 million posted for the same period a year earlier, when Proctor was running the bank.

Outwardly it looks as if the Sheikh’s new regime has not just weathered the financial storms of the day, but managed the start-up bank into rude health against the most difficult operating conditions in global banking since the Great Depression.

But again, in Qatar, things are not always as they seem. Some QR34.4 million is booked as "other income". What other income? Note six of the statement reveals that Al-Khaliji received QR78.93 million "within the government plan to support national banks". That means it got a handout. Some QR34.4 million of it was applied directly to the profit and loss account, allowing Al-Khaliji to pump up the numbers. The infusion amounted to 66% of the bank’s Q1 profit.

The rest was deferred, to be posted to the P&L for the next quarter ending June 30, only this time with a bigger impact on the bottom line – some 85% of net profit. Al-Khaliji justified the handling of the handouts with a remarkable statement, describing the "government assistance [as] representing the difference between the actually achieved margins during stressed market conditions and the margins that would have been achieved under normal market conditions". It seems Al-Khaliji was in denial that the world had changed, and had a central bank willing to imagine that there hadn’t been any sub-prime impact in global banking at all.

In Q3, the third period under the stewardship of Sheikh Hamad and McCall, the state’s helping hand proved to be the difference between a modest profit and an embarrassing loss. Although now more than a year from the low-water mark of the global financial crisis, Al-Khaliji still seems to be struggling with what constitutes "normal market conditions". Is it the actual business environment a year on, or what it wants it to be, the conditions before the financial crisis? In Q3, another government dollop, this time of QR96.95 million, went straight to the bottom line, enabling Sheikh Hamad’s Al-Khaliji to declare a profit of QR27.93 million for the three months, and QR136.34 million for the nine months, compared with the QR21.21 million on Proctor’s unassisted watch a year earlier. The Qatar government had made available a handy QR179.6 million to keep Al-Khaliji’s books blooming.

On August 9 last year, Al-Khaliji’s acting CEO McCall and his fellow South African chief financial officer Christiaan de Beer presided over a press conference in Doha and proudly unveiled the Q2 numbers, noting that "half-year results reflect ... the continuous expansion in consumer and Islamic banking activities, to gains from corporate lending and trade finance activities", while trumpeting a 750% increase in profits. The only hint there were government handouts in the P&L mix was McCall’s note of the "proactive approach and support given by the Qatari government and Qatar Central Bank in supporting the stability of the banking sector during difficult times".

Euromoney met McCall in his office on October 29 – six months after Proctor and many of his former colleagues were removed and detained, but before the full extent of the plight facing Proctor became apparent. Flanked by bank spokesman Cordahi, McCall claimed: "David Proctor was moved out to adviser to the chairman and I was asked to come into an acting position. The new chairman has a tremendous amount of gravitas. We work very well together."

He said Proctor’s removal was because a "different skill set" was now required at the start-up bank. "It’s natural in the evolution of the company. We are starting to get some air beneath the wings and we are taking off now, and our Q3 results reflect that."

He said Al-Khaliji was "making money from day one", describing it as a "wholesale-led bank, a quasi-corporate and investment bank". McCall said its large capital base of $1.2 billion "gives us capacity to play with the bigger players". Asked how Al-Khaliji was impacted by the global financial crisis, McCall said that because Al-Khaliji was a new bank, its exposure to the "overflowing" real estate market was limited. He said that because Al-Khaliji was "born into the financial crisis ... we haven’t been exposed to the perils that others have".

"Indeed, it was with great pleasure that we could walk out of the meeting [with the Qatar Central Bank] and say, ‘We’re not affected ... we don’t need your help.’"

Euromoney: "You didn’t get any infusions or anything like that at all?"

McCall: "Indeed."

He said that Qatar’s banking system is perceived as being secured by an "implied government guarantee" but denied this fostered an atmosphere of "moral hazard" among local bankers but that it rather encouraged a "sober" prudence. As per the QFC, McCall noted that an advantage of the new jurisdiction was that it "made the processing of visas a lot easier".

"We are operating very comfortably here, we’ve not had any undue related issues in terms of the legal or regulatory environment," said McCall. "I think David Proctor has moved on now."