Risk defines the career of former Scotiabank CEO Rick Waugh. Calculating and pricing risk was his life’s work, according to Howard Green’s new book, Gimme a Crisis: In the Room with Global Banker Rick Waugh.
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For bankers reading Waugh’s professional biography, the book offers a deep look into the Canadian bank’s culture throughout Waugh’s 43-year career. The book describes how the country’s third-largest bank navigated numerous specific challenges, including the first big one Waugh faced as CEO: The 2007 collapse of mortgage-backed securities.
Gimme a Crisis describes Waugh’s rise through the ranks, which took him through the bank’s credit department, and details how the self-described “deal junkie” treats lending like value investing: An art rather than a science.
Green, a veteran business journalist, chronicles Waugh’s rise from a teller in Winnipeg to the corner office in Toronto. Throughout this well-sourced work, he doesn’t shy away from the sensitive subjects, even touching on a time he publicly challenged Waugh on his compensation and the time Waugh denied Donald Trump a loan.
For industry professionals, the book serves as a history of Canadian banking, a study in leadership during turbulence, and a reflection on what exactly the executive leadership teams of banks do to earn their paychecks.
Waugh’s long climb
The author dedicates the first eight chapters — the bulk of the narrative — to Waugh’s pre-CEO career. This structure provides a deep appreciation for the decades required to cultivate the judgment necessary for the role.
Waugh spent 43 years at the bank, navigating roles in treasury, corporate credit and international banking before taking the helm.
This lengthy timeline highlights a structural inequity in the industry: the historic exclusion of women from the rungs of the corporate ladder necessary to reach the top.
“Does she mind going down one floor?” asks the title of Chapter 11, referencing the era when women were barred from Scotiabank’s executive floor washrooms. Green details how the industry systematically boxed women out of the experience required for executive roles — experiences Waugh was privileged to have.
Waugh went on to try to dismantle these barriers. He championed an “advancement of women” initiative and established a “human investment committee” at Scotiabank to review high-potential talent and fill vacancies, ensuring leaders looked at diverse slates of candidates, according to Sylvia Chrominska, the bank’s former head of human resources.
In 2007, Waugh’s push for gender diversity eventually led to Scotiabank receiving an award from Catalyst, a nonprofit research and advocacy group that helps build workplaces that work for women.
The Argentine affair
For readers like me who deal with stresses primarily behind a desk and keyboard, Waugh’s experience in Argentina offers a counterpoint involving physical danger and a total economic collapse.
In 2001 and 2002, Scotiabank’s Argentine subsidiary, Quilmes, faced a catastrophic run on deposits as the country’s economy imploded and the government imposed a restriction on withdrawals. Waugh, then head of international banking, traveled to Buenos Aires at least a dozen times during the crisis.
The situation escalated when Argentine authorities prosecuted Alan Macdonald, the CEO of Quilmes, for the bank’s failure to dispense cash — a direct result of government restrictions.
Scotiabank convinced a judge to let Macdonald return to Canada for a country manager meeting, but the judge required a stand-in who would face the same travel restriction. Scotiabank picked Jim Shields, already the head of retail and small business banking in Argentina, to remain in Macdonald’s stead.
Not long after, Scotiabank decided to stop injecting capital and sell Quilmes. The bank’s Canadian employees would be able to leave without much trouble, but Waugh needed to come up with a plot to extract Shields.
The plan involved naming the CEO of another Argentine company as the CEO of Quilmes, which would technically free Shields up to leave. However, Shields still had to worry about making it through customs on his way out of Argentina.
Scotiabank sent Waugh and Anatol von Hahn, a former head of Scotiabank’s Argentine unit, to escort him. The trio would have to fly commercial to Uruguay, where the company jet would pick them up and take them the rest of the way. (The jet faced confiscation if it entered Argentina.)
Eventually, they made it out. As the wheels left the tarmac on their flight to Uruguay, von Hahn recalled thinking, “Holy shit. We’re out of there.”
Throughout the ordeal, Green describes Waugh maintaining his trademark composure. Once safe on the company jet in Uruguay, the team drank Scotch, and Waugh revealed he hadn’t left empty-handed.
“I arranged to have a couple cases of Argentinian wine, Malbec, put on the plane,” Waugh said.
Captaining a crew
Green’s narrative encourages the reader to ponder: What does a CEO actually do? The answer, according to Gimme a Crisis, largely involves reading and managing people.
While Waugh is the protagonist, the book illustrates that a CEO’s success depends heavily on an ensemble cast — a point Green directly addresses in his introduction.
Green spills significant ink on key lieutenants such as Sabi Marwah, the chief operating officer whom Waugh trusted implicitly to run the bank day-to-day during his tenure as CEO.
The book also highlights Bob Brooks, the treasurer who managed liquidity at Scotiabank during the 2008 crisis. Waugh convinced Brooks to delay his retirement by a year to help manage the choppy environment.
The story also shifts focus frequently to country heads in places including Argentina and the Dominican Republic, showing that while the CEO sets the tone, the bank’s survival often rests on the judgment of executives in the field.
Avoiding first in tech
Waugh took a somewhat conservative view on technology that prioritized risk minimization over innovation.
In the book, Waugh describes technology as a tool rather than a strategy. He prefers Scotiabank to be a “quick follower” rather than a pioneer, arguing that second-movers save money by adopting proven systems.
Former Bank of Canada governor and Scotiabank board member David Dodge felt the bank underinvested in technology. Dodge argued that the bank “misjudged the importance of technology,” characterizing Scotiabank as “probably the slowest” of the big banks to modernize.
Years later, Waugh maintained his skepticism of automation. “I’d rather have a pilot in the plane rather than relying on an algorithm,” he said.
On the cybersecurity front, the book reveals a fascinating (and, for some, perhaps cringeworthy) dynamic between Waugh and his COO. Sabi Marwah admits he intentionally withheld certain details about cyberattacks and privacy issues from Waugh.
“Rick, I’ll tell you everything, but there’s some things you really shouldn’t know,” Marwah told Waugh, reasoning that if things went wrong, Waugh needed plausible deniability to fire Marwah and save the bank’s reputation.
Gimme a Crisis offers bankers a detailed look at the decision-making processes that defined a golden era of Canadian banking. It portrays a leader who thrived on chaos and understood banking as, ultimately, a people business.