HSBC Holdings is to relaunch its Dubai-based merchant bank in October or November to respond to the growing opportunities for investment banking in the region. The bank is to be relaunched as HSBC Financial Services (Middle East), and will operate under the investment bank licence of the HSBC subsidiary Wardley Middle East.
Wardley Middle East has operated since the licence was issued in 1975, but its activities have remained low key, the bank says. The new operation will offer a full range of investment banking services, and will have about 18 members of staff, who are now being recruited. The chief executive officer is Mukhtar Hussain, who has been based in the UAE for two years and was previously with another HSBC subsidiary, the London-based Samuel Montagu & Company.
‘There are a number of developments in the region, which offer opportunities for dedicated investment banking,’ Hussain says. The revitalised investment institution will offer expertise in project finance, privatisation, capital markets, equity brokerage and private banking. All these services will be backed up by HSBC’s subsidiaries which are specialists in each of these areas, Hussain says.
The financial packages recently put together to finance the expansion of two aluminium plants in the Gulf, Dubai Aluminium (Dubal) and Aluminium Bahrain, have demonstrated that large companies in the region are keen to explore what financing can be raised on the international markets, Hussain says.
HSBC Financial Services, will have capital of Dh 49 million ($13 million), the same as its predecessor Wardley.
British Bank of the Middle East (BBME), another HSBC subsidiary, is also seeking to broaden its activities in Dubai, by appointing a senior Japanese executive to its branch in Jebel Ali. Japanese firms are showing an increasing interest in developing in the free zone as a regional base, and the new appointment will help develop business in this sector, says Brian Frederick, BBME’s senior manager for the UAE. BBME also opened a new branch office in Sharjah on 12 June (see UAE).