Ahmed Hundubey, the Executive Director of Currency, Banking Operations: Central Bank of Somalia, outlines the priorities of the CBS.
Ahmed Hundubey was born in Central Somalia, in the state of Galmudug, to a construction worker father. After high school, he left the country for a better life and education. His journey took him to Canada, where he did his undergraduate and Master’s studies and began his career as a practitioner in the field of finance. For 30 years, he was out there, battling it out on the global stage in the world of finance. He joined as a banker at Keys Bank NA in the State of Oregon, and a few years later, he moved to Wells Fargo Bank, one of the largest financial institutions in the United States, and on and on it goes.
The Somali Investor Magazine had a lengthy conversation with him. We bring you his exciting and illuminating take on the priorities of the Central Bank, technology for financial inclusion, and a sneak peek into the behind-the-scenes preparations for the re-issuance of the Somali Shilling and more…
Tell us about your time at the University of Northern British Colombia where you did both your Master of Economics (MA) and Bachelor of Commerce.
You can understand how as an immigrant, it is not easy to study and support yourself at the same time. When I joined campus, in the beginning, I was interested in Computer Science; Information Systems. However, one of my lecturers persuaded me to take up accounting and finance, and the first few classes I went to were so enjoyable that I was permanently sold to the world of figures.
What are some of your favorite memories from your time there?
My best memory would be the friendships I made at the university. I met people from all corners of the world. Africans, Indians, Frenchmen, Canadians, etc. Some of these people later became Ministers, members of the Canadian Parliament, and colleagues at the financial institutions that I worked in while still living abroad.
I remember the winter walks… The university was located at the top of a hill in the city of Prince George; in winter there were no bus services on the weekends. I had to walk to school and to work; in high altitude, snow, and harsh winds for an hour and a half.
I am glad you have mentioned work… how did you get here?
I started at Keys Bank in 2001 (branch and retail management), then went to Wells Fargo Bank, where I did Credit Underwriting and Commercial Lending for five years. After this, I returned to Canada and joined the Royal Bank of Canada, where I worked in different positions, starting with Business Banking, Commercial Banking Operations, and Corporate Relations. All adding to 22 years of the banking industry.
Where do you derive your resilience, inspiration, or strength when faced with a challenge or adversity on the job?
For me, when faced with adversity or some tough situation, I fall back on the ‘why’; I fall back on what motivated me (from the start) to get on the task in question. For example, returning to Somalia to join the Central Bank wasn’t easy. The challenges were great; security issues in the country, structural challenges, systemic concerns, a completely different corporate culture, etc.
At such times when the odds looked overwhelming, I fell back to the idea that I believed it was my duty, my obligation, to come back and help rebuild Somalia. I grew up here as a child and enjoyed certain benefits before the conflict. I have to be part of the process of rebuilding my homeland.
What exactly does being the Executive Director of Currency at the Central Bank entail?
My office is responsible for providing strategic and organizational leadership in relation to Currency and Banking Operations, which includes: a) banking operations, including Public Sector Operations, Cash Management, and Foreign Exchange; b) Branch Operations. I am also responsible for the deployment and management of banking services and bank operations; and overseeing the development of policies in areas of foreign exchange procedures, Central Bank Reserve management, currency issuance, commercial gold, and branch operations.
In addition, I provide information, relevant recommendations, and reports to the Governor/Deputy Governor regularly and as needed. Further, I am responsible for assuring the quality of the Financial Markets Department’s work, performance, and implementation via the approved methods and according to the CBS policies and strategies.
What kinds of initiatives are you, as the Executive Director of Currency, looking to put in place regarding the Somali shilling?
Somalia has yet to issue its legal tender (the Somali shilling) since 1990. However, in the last 6 years, the Central Bank of Somalia has been working towards re-introducing the shilling. We are moving in the right direction in conjunction with the International Monetary Fund (IMF) and the World Bank. It is a priority for us, and we are working on laying down the right structures, policies, and infrastructure, organizing capacity building for staff, arranging for secure storage facilities, ironing out the legal aspects, and others. This is our priority now, and we are committed to reintroducing a safe and legal Somali shilling when the time is right.
You have been at the Central Bank for 3 years now. What are some of the Central Bank’s biggest achievements within this period?
We have had a good run, with countable milestones; the first one is the launch of Somalia National Payment (NPS) in August 2021, the system of inter-bank payment, clearing, and settlement systems in Somalia, and itconnects the Central Bank and the 13 licensed commercial banks. It is a buyers’ and sellers’ market. The Central Bank of Somalia is the owner, operator, and participant.
Today, Somali citizens can transact with anyone in any bank without presenting themselves in person. The CBS does the clearing and settlement. For this reason, the National Payment of Somalia was awarded (in 2022) by the Committee of Central Bankers based in London as one of the best financial market infrastructure national payment systems in the world after 30-plus years without National Payment.
The second achievement is the CBS strategy to transform the financial sector of this country. Last month, we implemented (International Bank Account Number – IBAN) compliance. This was launched on March 20th. It will allow our financial institutions to connect to the rest of the international banking services and make validating their transactions easier.
The third project in the pipeline is Somali Payment Switch (SPS). We leverage technology to solve some of the challenges we face. To continue the digitalization of our financial institutions, we adopted a national QR Code. This will ease the interoperability of retail payments. The National Payment System (NPS) has an Automated Transaction System (ATS). The Somali Payment Switch connects the interoperability of ATMs, debit cards, credit cards, mobile wallets, etc., and infrastructure to support 13 commercial banks, all connected to our ATS. The Somali Payment Switch is owned by Central Bank and 13 commercial Banks.
What leadership qualities are essential for success as the Executive Director of Currency, Banking Operations at the Central Bank?
When you are a leader, you need to be charismatic, task-driven, and have the ability to get things done while motivating your team. Empowering my team is a big part of realizing our vision; subordinates were my biggest assets.
What is the greatest challenge the Central Bank has faced in the recent past, and how did the institution deal with it…
Our greatest challenge is that we have not issued a legal tender for the last 30 years. The questions from the public… you would not believe how much concerned Somalis are about this. The other challenge is that the Central Bank is an autonomous institution, but we had (in the previous government) situations that drew us into politics, causing us unnecessary distractions. When the PM and the President are not working well together, and the spillover leads to the organization being pulled into it, it affects our operations.
And the third challenge was proving ourselves within the international community that we could implement complex projects in Somalia. There was a tendency in Somalia for projects often to be completed over a long time. However, after a while, we earned their trust and gained more support from them. We are grateful for their continued technical and financial support.
What is the greatest challenge you have faced at a personal level since you returned?
My safety and security were some of my greatest personal challenges. Somalia has on-and-off outbursts of violence, most of which happen in Mogadishu, where we are based. The other was being away from my family; it wasn’t easy since they were in Canada. The long months of separation. However, I look at all these as the sacrifices that I have to make, and I take it in my stride.
How do you see the role of communication in building public support and understanding? And how have you been able to communicate some of the Central Bank’s policies to the public?
Communication is a management tool and a tool for increasing our efficiency as a team. Whenever we have any project we are working on, whether it is with all 13 commercial banks, the Somali Bankers Association, or any other stakeholder, we ensure that the lines of communication are open. There is a free flow of information. We are open to feedback, even from the public, and make adjustments based on this feedback.
What role do you see technology playing in fostering financial inclusion in Somalia?
Fostering financial inclusion is one of the pillars of the currency reform project for Somalia. Today, the lower economic individuals are the ones who use the Somali shilling. We are working on modernizing how payment is made through the QR Code that we recently adopted. All our transactions, retail, commercial transactions, person-to-person, person to bank, business to business will be affected by this. It is important to have the entire population participate in this. We expect this to increase financial inclusion and for many people to utilize the new Financial Fractures by opening new banking accounts, mobile Wallets, etc.
For the past few years, The Ministry of Finance in Somalia has been on a path to reform financial governance in Somalia. As a key industry leader, how do you view those efforts?
The Central Bank is an autonomous institution, but we have very close cooperation with the Ministry of Finance and have been with them every step of the way in the various reform initiatives. As you know, we are the Bankers of the Government and manage their Single Treasure Account (TSA).
What advice would you give to young Somali scholars pursuing economics as a discipline?
Do something that you like. And for those who studied in the diaspora, the country needs you. No one will rebuild this country for us; you must get it done.