It was quite a shock to hear that the UAE has replaced the governor of its central bank, Sultan bin Nasser Al Suwaidi, who has been in the job for 23 years. His replacement is the CEO of the Emirates Investment Authority, a sovereign wealth fund, Mubarak Al Mansouri.
When men like this go suddenly there is always the question of what went wrong but this is just speculation as we have no idea. Clearly it might just be thought a change at the top was overdue. Bankers have long been critical about the internal mechanisms of the UAE central bank.
Time for a change?
Could the problem now be that global regulators are demanding greater levels of compliance from the UAE and that Mr. Al Suwaidi has become a block to this change?
Or it could be that Mr. Al Suwaidi has paid the price for calling a halt to the latest Dubai real estate boom with the raising of mortgage criteria last autumn? Then again he was very supportive in Dubai’s hour of need in 2009 and assisted with the $10 billion in emergency funding that the bank bought as a bond towards the $20 billion bailout package.
Abu Dhabi has been particularly keen to ensure that Dubai did not over borrow again and get itself into financial difficulty. However, fears that the emirate might need a second bailout proved wide of the mark amid a very strong recovery.
Mr. Al Suwaidi has certainly played a vital part in the epic transformation of the UAE over the past 23 years from an oil-rich backwater into a much larger and cosmopolitan nation with world-class infrastructure.
He’s always been a safe and reliable pair of hands at the helm. Perhaps it was just time for a change.
Again we don’t know. It is just speculation. But the removal of such a key figure usually has a reason that may never be known or only become apparent much later.
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