UK-based Barclays Capital has six mandates for initial public offerings (IPO) and bond issues this year across the GCC.
“We have regional IPOs, but they are not domestic, they have bigger ambitions than just listing locally,” says Makram Azar, vice-chairman of investment banking at Barclays Capital.
The bank is expecting growth from the GCC in 2012 as UK lenders such as Lloyds TSB and Royal Bank of Scotland (RBS) look to reduce exposure to the region. Lloyds is looking to sell its assets in the GCC and RBS is offloading parts of the business and downsizing due to economic problems in the UK.
Barclays Capital aims to target family-run corporations in the region, which account for about 90 per cent of non-oil gross domestic product (GDP).
“The region is economically quite healthy and we don’t see signs of that changing. With regards to deal flows, 2012 will be a reasonable year,” says John Vitalo, chief executive officer, Barclays Middle East & North Africa (Mena).
High oil prices, which averaged $100 a barrel in the past year, have given rise to strong budgets, fiscal standing and liquidity of the Gulf economies, says Vitalo.
Growth in Dubai’s tourism, services, trade and logistics sectors has also improved, he says. Dubai’s economy grew by about 5 per cent in 2011 and Barclays Capital is keen to provide funding to the government if requested.
“I would not rule out financing to some of the state-owned enterprises in Dubai. We are optimistic about Dubai’s ability to manage its way through it [the debt restructuring process],” says Vitalo.
Barclays Capital will delay expansion in the wider Mena region for at least the next three years Vitalo adds.