An interview with Mr Amer Bukvić, CEO of Bosna Bank International
1. Looking at the profile of Mr Amer Bukvić, your exposure to the East, the West and the Middle East has gained you many personal qualities and professional skills and qualifications. How did that exposure help you become globally competent? And what challenges did you face in your journey to success?
From early childhood, I had been moving from the East to the West, being a son of engineers who worked in the Middle East and Africa. I lived for two years in Sudan, four years in Iraq, and two years in Libya. Throughout that time I had been coming back to Yugoslavia, or more specifically at that time Bosnia, as a republic of Yugoslavia, and I had been going from one educational system to another. When I reached my university level, I joined the International Islamic University Malaysia, after which I went to do my master’s at the International University of Japan. So I lived around five years in Malaysia and additional two years in Japan.
Then I came back to Bosnia and after one year of working for an American company I went to live in Saudi Arabia to work for the Islamic Development Bank for another five years. So I have been moving in and out of the Middle East, Africa, and the Far East and coming back to Europe. Generally, this has exposed me to different lifestyles, different outlooks to management, and different cultures overall. I also wrote a book on Japanese human resource management as a model for economies in transition in which, again, I compared management styles of Asia and Europe. I think this exposure helped me a lot in being what I am today. It made me understand the direction in which the world moves, because different cultures have different paths and different speeds in which their societies are moving. Experiencing both, the East and the West, the Middle East and Europe helps to understand where we are globally moving to and it definitely did help me in my life journey.
2. How would you describe your experience as the CEO of Bosna Bank International (BBI), the only Islamic bank in Southeast Europe? Could you please highlight the main opportunities for BBI to grow due to this status, and how do you use the available resources to benefit from those opportunities?
BBI was established in 2000, meaning just after the crisis in Yugoslavia in the ‘90s. That crisis was not only political or military; it was also affecting the mindset of the people, especially of those involved in economy and finance. We should remember that all banks in Bosnia, as a result of all these turbulences in the nineties, had collapsed and all depositors lost their lifesavings. So, after this period, in 2000, there was financial crisis, economic crisis, and the change of the set up from a socialist economy into free market economy. BBI came into a country which was a socialist, communist led country, with an appeal for Islamic banking and finance.
It was really a challenge. It was a challenge for us to operate in the market where there were no laws and regulations that would govern Islamic banking. It was a challenge to do this operation without trained individuals who would know what Islamic banking and finance is and what it stands for. It was a challenge to offer your products to the market that does not understand what Islamic banking and finance is. So it was a very difficult task and it took us several years to develop products, to train the staff and to educate the public about the market before BBI could enter the market and rise. Another problem is that the market had been penetrated by banks from Western Europe, which have a huge experience in setting up their operation. They expanded not only in Bosnia but in whole territory of former Yugoslavia, so they just multiplied their branches and their set ups throughout the country and because of economies of scale we had a challenge in being competitive in the market.
With all this, BBI has succeeded and it became the fastest growing bank in the market actually starting from greenfield operation while other European banks acquired small banks that were established just after the war. We did the greenfield and we became the fastest growing bank in the market and from the last position we grew to the level of being the sixth bank in the market. We are counted in the category of the medium-sized banks in Bosnia. We have grown twelve times in terms of assets in this period of fifteen years, and we continue to grow. In just last yearon-year figures, the bank’s assets grew 30% and our profitability grew equally, by 30%. So, definitely BBI is a model that should be studied on how Islamic banks can penetrate a post-socialist environment and manage to outgrow and outplay much stronger conventional banks which had economies of scale on their side.
3. Being a highly-qualified, well-recognised leader in the Islamic banking and finance industry, how would you evaluate the progress made by different players in the industry? What are the main points of strength? And what elements are currently lacking (if any) to further grow the global Islamic economy?
In my opinion, Islamic banking has mimicked conventional banking far too much and far more than it should have. Islamic banking is a completely different ball game than conventional banking and Islamic banks did not manage to show their advantage to the level they should have. However, Islamic banks have grown and reached to a certain level, after which we should focus on showing our difference from conventional riba’ banking. In a way, we can be happy about the progress that was made, but also we should be aware that we are far away from the destination where we should be. Islamic banks have to be more involved in every particular industry and operation in which they are part of, meaning they need to be more of a financial partner than of a bank.
That is why BBI is trying very much to show the market how different we are from other banks. We get involved in organizing investors to come in the market, to come to our clients; we get involved to promote the projects of our clients through Sarajevo Business Forum and to promote the products of our clients through Sarajevo Halal Fair. In this way, we are differentiating ourselves from the banking industry of Bosnia and we believe that differentiation is the key word for Islamic banks globally to move forward and differentiate themselves from other riba’ banks, meaning that they should be more involved in the actual challenges of their clients, take more risks and follow the real assets and projects in which their clients are involved.
4. As the organizer of Sarajevo Business Forum and Sarajevo Halal Fair, what is the mandate you have set for each event to achieve? How much has been achieved so far and what are the main strategies set to effectuate the outcomes of them?
We have two events currently being organised by Bosna Bank International. One is the exhibition of projects taking place in spring in April, which we have been organising for ten years, and that is the Sarajevo Business Forum. This is the exhibition of projects, mainly of our clients’, which want to expand in different fields. Since the regulator keeps us on borderlines of conventional banking when it comes to investments, we needed to establish a platform – if we could not invest in all these projects, at least we could promote them. That was our goal and our goal was to be closer to our clients by promoting their projects.
In autumn, we organise the Sarajevo Halal Fair. This is an exhibition of products, mostly of our clients’ products. So, we are promoting projects and products to the customers of BBI bank and with this we enter the market as their partner and also go a step further compared to conventional banks. We managed to open up Sarajevo through this, to promote Sarajevo as a desirable destination for doing business rather than a conflict-ridden area as it has been viewed after the crisis, and also to promote our partners which operate in this market. We have succeeded in changing the perception of our market with Sarajevo Business Forum and we have succeeded in setting a vision for our market as a halal platform that could service the needs or the demand of the halal market in Europe, which has around 51 million Muslims. We believe we have been successful, and by many, the Sarajevo Business Forum is perceived as the biggest investment conference in Southeast Europe and the Sarajevo Halal Fair is definitely the biggest exhibition of halal products, maybe even in Europe.
5. What is the level of cooperation between BBI and the banking institutions in Malaysia, as the country that pioneers the industry? Especially extensive knowledge of Malaysia’s economy and in view of your good relationships with various leaders in Malaysia.
Being a student of IIUM, more precisely in Bosnia we have been referred to as “Malaysian students” or “the Malaysian group”, I have been influenced by the model of the Malaysian market. We have seen Islamic banks in Malaysia and we wanted to have Islamic banks in Southeast Europe in a similar manner. This is the first influence of Malaysia through the human capacity building which was an enormous support for Bosnia, having in mind that a few hundred Bosnians that studied in Malaysia are doing exceptionally well in different areas and different industries in Bosnian market. Secondly, we are trying to position BBI, the Sarajevo Business Forum and the Sarajevo Halal Fair as bridges for cooperation with the Far East, the Middle East and the whole world. Of course there is always special emphasis on Malaysia, which is our hearts and we put special efforts in bridging the economies of Bosnia and region of Southeast Europe with Malaysia
We have to know that Tun Dr Mahathir Muhammad has been the patron of the Sarajevo Business Forum since the establishment and has been the founding patron of the Sarajevo Halal Fair. On any occasion when His Excellency, Tun Dr Mahathir Muhammad was free, he attended our events and promoted Bosnia on numerous occasions. Tun Dr Mahathir Muhammad has a special reputation in our country. He is a leader that stood with us and behind us throughout the most turbulent times of Bosnian history. So until today, Bosnian youth, Bosnian intellectuals and Bosnian business people perceive Malaysia with a special respect and Tun Dr Mahathir Muhammad, of course, as a special leader in our hearts.
6.Bosnia and Herzegovina is not a full member of the Organization of Islamic Cooperation (OIC), where its status has been “Observer State” since 1994. However, BBI plays an instrumental role in creating partnerships between financial institutions in various Islamic countries and also helps the formulation of new strategies for Islamic finance to grow. What are the main factors leading to success?
The fact that Bosnia and Herzegovina is not a member of the OIC makes it difficult for the Islamic Development Bank to finance directly projects in Bosnia. So the IsDB decided to establish, with partnering institutions, namely Dubai Islamic bank and Abu Dhabi Islamic Bank, a financial institution that would play the role of IsDB in the context of Bosnia, which is, I repeat, not a member of the OIC. BBI was established in such a way as to play the instrumental role and to link the financial institutions of the Islamic countries to Bosnia. I think we have achieved that and I think BBI has proven to be a successful story and proven to be the platform through which Muslim world can cooperate economically with Bosnia and Herzegovina and the region of Southeast Europe. Although there is a lot ahead of us, we can say that we succeeded in this mission so far. And, regarding the factors which led to this success, I think one of the factors is, as I mentioned before, the fact that before leading this institution, I had an exposure to Islamic banks and the Middle East, and not only me but also the top management of this institution as well. That is why we could understand the two sides of the bridge and that way we became the bridge.
7.Bosnia and Herzegovina has made serious progressive steps towards joining the EU. How would BBI strategies its operations to benefit from this inclusion within the EU?
It is too early to talk about our membership in the EU and the strategies of BBI once we are a member of the EU. Definitely, there is a huge potential in the long run to look at and there is a huge opportunity for BBI to position itself as one of the key Islamic financial institutions of the EU in the future. However, at this point in time this is premature and Bosnia and Herzegovina is still on the borderline. We don’t look beyond the present moment. Our goal at this point of time is to become the leader in financial industry of Bosnia, and once we join the EU then we would reset our strategy.
8.BBI undertakes a number of innovative initiatives that are socially-responsible including BBI Academy and the annual scholarship programme in addition to conferences and seminars on various topics. What is the significance of these initiatives to the accomplishment of BBI’s mission? And how do you fund the various activities?
As I mentioned before, differentiation for us is the key word which makes BBI visible in the Bosnian market. We are competing with top financial institutions, top European financial institutions like UniCredit, Sberbank, Intesa San Paolo, Sparkasse, and Raiffeisen. All these big institutions, European big giants are wellestablished in this market and it is not easy to compete with them on their ground. However, being an Islamic bank, we are differentiated from all of them. All of them on one side, and BBI on the other. In that context our visibility became significantly more apparent. And we have realised that this has also promoted BBI and its mission. Please note that whatever we do, we do it with full passion. We do not have an alternative market; Bosnia is the only country we have. So, growing the Bosnian market, enhancing the Bosnian population, enhancing Bosnian human capacity, there is no alternative for us to move forward. So, we do not calculate.
We put our full heart into the operation and this becomes visible through time and this is what the market has proven to respect through the fact that BBI had grown so tremendously fast in the years behind us. Most of the activities we do, we do on a market basis, when it comes to organising events, seminars, conferences. These conferences are mostly profitable at the end and this is our modus operandi. When it comes to scholarships, we are actually channelling the scholarships of people of good will and international donors such as Sheikh Saleh Kamel from Saudi Arabia who himself has contributed very much to the education of Bosnian orphans. The interview concluded with a piece of advice from Mr Bukvic to future leaders that they must be courageous, take risks, work hard and endure all the challenges in the rocky roads which are ahead of them. There will be falls and rises and a leader distinguishes from others not by being always successful but by always standing up after falls.