Middle East

Euromoney recently sat down in Dubai with the heads of investment banking for HSBC in the Middle East. The conversation focused on the burgeoning trade and deal flow between the Gulf region and Asia, what investors on both sides are looking for and why they like what they see.

Global money is flooding into India to profit from high-performing stocks, a booming economy, and the ease of investing via Gift City, a growing financial hub in Gujarat. Local wealth is flowing the other way, notably to Dubai. It’s a gold mine for private banks, and the process has only just begun.

Bankers in the Middle East are intensifying their focus on succession planning as the first wave of intergenerational wealth transfer looms.

Abu Dhabi and Dubai sell themselves as international hubs for tech companies, with new initiatives to support start-ups and scale-ups, but rules around eligibility for equity listings will hinder the Emirates’ tech sectors if they aren’t changed.

Barclays hopes to win over investors with new return targets and buyback commitments next February, but it really needs a revival in investment banking.

Regulators are starting to take a more messaging-based approach to sustainable finance, but stopping greenwashing won’t automatically lead to a transition to net zero.

The 28th Conference of the Parties starts in Dubai tomorrow. Dubbed the finance COP, conflicting priorities could turn it into a fossil fuel investor roadshow.

The local sector is in good shape to weather a short-term conflict. If the war drags on and spreads throughout the region, however, the position is far less clear.

Data hoarding, ESG illiteracy and credit risk are roadblocks for regional banks looking to establish sustainable supply-chain financing programmes in the Gulf, just as COP28 approaches.

Turkey’s central bank took another step on the path to normalization when penalties for exceeding interest-rate caps on lending were scrapped last week. It is good news for banks, but will it last?

The risk of a new war with Israel will derail any fledgling economic recovery for Lebanon as it attempts to convince private-sector investors of its gas and renewable energy potential.  

Ahead of COP28, the sector needs to focus on lending for energy efficiency in the emerging markets before climate tech startups in developed markets, if decarbonization is the goal.

Digital sukuk issuance still faces the issue of uneven Shariah interpretation.

The relaxation of visa rules has turbocharged the recent flow of wealth into Dubai. The nature of these flows can, however, make them a mixed opportunity for the UAE’s private bankers.

The Lebanese diaspora has come home to pump fresh cash into the country’s economy, but the resulting price surge is a further blow to the lira-earning population.

ADIB’s almost 10-times oversubscribed additional tier-1 issuance shows interest in the product is alive and well for the right issuer, but demand won’t be the same for every bank.

Wealth management had a tough 2022. Assets under management fell across the board, undermined by global uncertainty. But one region is not struggling. More wealth than ever is being formed in the Middle East, and more of it than ever is staying there. Private banks are hiring as fast as they can and expanding their repertoire in Shariah-compliant asset classes.

The Kingdom’s government has announced that international firms – many of whom are based in Dubai – that want to work with the state will need to base their regional headquarters in Saudi.

2023 is shaping up to be the year of the pause for the region’s capital markets.

Several Gulf Cooperation Council countries have bank consolidation at the core of economic visions. As governments push for national champions, pressure is building across the industry as banks jostle for position.

If Olam Agri’s planned dual-listing IPO goes ahead in June it will have a bit of everything: a Singapore-Saudi listing, geopolitics and sovereign funds jostling to defend their nations against strain in global food security.

As the Gulf IPO boom subsides, will better allocations for international investors, dual listings and better secondary-market liquidity be enough to ensure that the region’s equity capital markets can mature?

Jordan Kuwait Bank has issued the country’s first green bond, a key milestone for sustainability driven capital investments in the country. But getting momentum going in the sector will be an uphill battle.

Both Egypt and Turkey have recently been able to tap dollars more cheaply through sukuk.

First Abu Dhabi Bank’s recent interest in a bid for Standard Chartered and an ill-fated investment in Credit Suisse by Saudi National Bank have put the spotlight on Middle East banks as potential acquirers of international firms.

SLLs offer more flexibility for borrowers targeting sustainability, but the structure is coming under scrutiny around the world for potential greenwashing concerns.

A month ago, First Abu Dhabi Bank said it had looked at Standard Chartered but decided against a bid. Now, it is believed to have changed its mind. What has changed?

Across the Middle East and North Africa, Egypt and its banks boast august credentials when it comes to climate and sustainability. But frameworks and agreements are one thing, creating substantive change across an entire financial sector is quite another.

First Abu Dhabi Bank looked long and hard at Standard Chartered, and others will do the same so long as it’s cheap. But any suitor must win the approval of Temasek.

The Middle East’s capital markets were awash with plus-sized IPOs in 2022, with a growing belief in its future.