Saudi Arabia’s market regulator, the Capital Market Authority (CMA), has granted the US’ Citi Bank a license to offer investment banking and capital markets services, marking the return of the US-based lender to the kingdom after an absence of more than a decade.

Citi, which had a presence in the Middle Eastern markets for decades, had lost it license in the kingdom after 2004 sale of its stake in Samba Financial Group.

International lenders are returning to Saudi Arabia to capitalise on opportunities as the kingdom tries to radically transform its hydrocarbon-dependent economy. The kingdom is selling less than 5 per cent stake in state-controlled oil and gas giant Saudi Aramco to public in what could possibly be the biggest ever IPO in the world. The mandates on the deal have already been won by HSBC and Citi’s Wall Street Peers JPMorgan Chase and Morgan Stanley.

Part privatisation through public floats of some of the other state assets, which is expected to trigger a flurry of deals on Saudi Stock Exchange (Tadawul), also serves as an incentive for international banks to base camps in Riyadh. Saudi debt capital market activity has seen a significant increase since last year as both sovereign and corporates are tapping the loan and bond markets to shore up finances.

The bank had helped the kingdom on its record-breaking $17.5bn bond sale last year and $9bn Islamic bond this month. It joins JPMorgan Chase, Morgan Stanley, Germany’s Deutsche Bank and UK’s HSBC, which all operate under investment banking licenses.

With its license, Citi will provide full range of “investment banking, debt and equity capital markets, markets and securities research capabilities to local and international institutional clients,” it said in a statement.

The New York-based lender has tried to unsuccessfully enter the market in the past. It has recently appointed Carmen Haddad as chief executive officer in the kingdom to rebuild its business there, according to reports.

“Saudi Arabia is a regional economic leader and a strategically important market for Citi,” Jim Cowles, Citi’s CEO for Europe Middle East and Africa said in the statement, adding that the country has embarked on an economic transformation journey and Citi was “committed to contributing to this endeavour”.

Citi has been present in the Arab world since 1955 and offers full scale corporate and investment banking services. Its institutional capabilities in the region include treasury and trade solutions; corporate and investment banking; markets and securities services and capital markets origination.