How one Kiwi’s drive and passion helped shape the World Bank Treasury

Perspectives of WB Treasurers Series as Treasury celebrates 70 years of connecting capital markets to development

Graeme Wheeler, a New Zealand national, had always wanted to work at the World Bank—so much so that he applied three times before joining the institution. Prior to joining the World Bank, he was Treasurer of Debt Management Office and Deputy Secretary of New Zealand Treasury. When he finally came on board in 1997, as Director of what was then Treasury’s newly formed Financial Products and Services, he was electrified. 

 “If you were interested in development, if you were interested in finance, the World Bank was the place to be. Quite frankly, this was the greatest job in the world.”

But it was when he became Vice President and Treasurer, in 2001, that Graeme really hit his stride. Initially, it was a huge leap: in his previous role, he had managed a department of 15 colleagues. In his new role, he would lead 250 people—a tremendous responsibility.

Graeme was committed to creating an environment that fostered innovation. To achieve this, he focused on building the finest management team possible, increasing morale, and empowering colleagues. This emphasis on people paid off, and resulted in one of Treasury’s key business lines: its client advisory services. By harnessing the expertise, skills and creativity of his team, he was able to build the foundations for what are three advisory service offerings: banking and risk management, debt management, and asset management.

At that time, Graeme was responsible for the functions performed by banking and risk management as well as debt management teams today. These teams were not part of Treasury at that point but when Graeme was appointed Treasurer, he decided to bring the teams as part of Treasury. 

Banking and risk management advisory services

Their work transformed the Bank’s lending products from a complex, pooled currency instrument to the Libor based products that it offers today.  At the same time, his team introduced various hedging products.

“The hedging products would enable our clients to transform the risk characteristics of their existing portfolios so it was a very big deal and it was very well managed by Treasury,” remembers Graeme.

Today that team, called Financial Products in the Financial Advisory and Banking Department (FABBK), continues to advise clients on the Bank’s lending and risk management products.  Its risk management tools have now extended to include commodity hedges as well as catastrophe risk products to help clients manage the risk from natural disasters like earthquakes, hurricanes and even droughts.

Debt management advisory services

Under Graeme’s leadership as Treasurer, Treasury began its debt management advisory services to help countries manage their sovereign debt.  

“Finance Ministries are charged to manage large debt portfolios, which are often the largest portfolios in a country and which can generate substantial risk to its balance sheet,” says Graeme. “I felt it was our responsibility to provide capacity building in sovereign debt management to our clients.”

Graeme, with his deep experience on Public Financial Management, in particular, on debt management, authored “Sound Practice in Government Debt Management”, a revolutionary book published in 2004 that served as a handbook for debt management practitioners.

From an initial 12 country clients in 2005, the program reached to 49 client countries. Initially focused on technical assistance to help countries design reform programs and debt strategies, in 2011 the objectives expanded with the introduction of the  Government Debt and Risk Management Program (GDRM)—one of Treasury’s flagship programs. Today, the Financial Advisory and Banking Department Government Debt & Risk Management Advisory (FABDM) team draws on the expertise of colleagues across World Bank Group to help countries design debt strategies, execute financing transactions efficiently, develop government bond market and manage risks coming from contingent liabilities. In addition to the advisory services the team offers a range of training and knowledge products. 

Asset management advisory services

Graeme also helped create the Reserves Advisory Management Program (RAMP) during his tenure as Treasurer.  Launched in 2001, RAMP provides capacity building and investment management services to central banks, sovereign wealth funds, and national pension funds to help countries efficiently manage foreign currency reserves and other investment portfolios.  From an initial two clients, RAMP grew to 20 clients during Graeme’s tenure, and today serves 65 clients.

Risk and analytics monitoring

Graeme, when he was Treasurer, also set up a dedicated quantitative strategies risk and analytics team, known today as Quantitative Solutions, SAA & Analytics (QSA) department, to house all the risk management work being done in the various Treasury departments. This created what he calls “a power house” of risk management, strategic planning and quantitative analysis department that offered quantitative advisory for capacity building of central banks which evolved today to include sovereign wealth & pension funds, office of debt management & strategic partners. The department promotes the World Bank Group image and global standing by working as a research hub through partnerships, peer-reviewed articles, internal & external publications, and conferences. QSA today has become the focal point of all World Bank Treasury quantitative needs.

A lasting legacy

With all these innovations, one element was consistent: Graeme’s investment in people. And it paid off: when he retired in 2006 as Treasurer, he left behind a strong team driven by creativity and innovation—the DNA of Treasury today. His career at the World Bank did not end in Treasury.  Graeme continued and worked as the MD for Operations from 2006 to 2010.

His legacy and contribution is best summarized in his own words: “The World Bank Treasury is a pioneer in using capital market products to meet clients’ needs, and a center of excellence in providing advice to clients and managing the Bank’s own portfolios. This innovation and excellence is recognized around the world, and achieved thanks to the tremendously talented and dedicated Treasury colleagues.”   

Written by: Jane Kathleen Manahan in collaboration with Audrey Mpunzwana, Alexandra Klopfer Hernandez and Christine Divov

Video produced by: Rita Stankeviciute