Chinese banks are growing their presence in Dubai, according to Jeff Singer, chief executive officer (CEO) of Dubai International Financial Centre (DIFC).
They are growing, upgrading their licences to be able to offer all the services a lender can deliver from DIFC, he says.
He adds that some banks have already upgraded their licences, while others are in the process. DIFC is also in talks with Chinese asset management companies and insurance providers to set up in the financial free zone.
Currently, the top four Chinese lenders Bank of China, Agricultural Bank of China, Industrial and Commercial Bank of China, and China Construction Bank have a presence in DIFC. These banks manage more than 50 per cent of Chinas assets. Singer expects them to offer services related to trade routes between China, Africa, Kazakhstan and the Middle East. The UAE is Chinas largest export market in the Gulf, with bilateral trade between the country and Beijing increasing 16 times since 2002 to reach $40.42bn in 2012.
Of course they will be financing companies from China, but I wouldnt be surprised if they started becoming part of syndicates as well, he says. There is huge wealth present in these banks. They have a balance sheet they can deploy, and understand the risk.
Taking into account the capacity of its recently completed towers and the upcoming Central Park development, DIFC will be able to house 30,000 additional employees, according to Singer. In the first six months of the year, 1,000 new jobs were created at the free zone.
Lenders looking to establish a presence in a new region typically start off by opening a representative office, before bringing in a sales team to help sign on more clients. The most sophisticated licence type is one that allows a financier to offer full banking operations to its regional clients.