The UAE is well positioned to become a global centre for private banking as it offers an attractive home for high-net-worth individuals with good infrastructure and services, and low taxes.

“We would like to see the UAE evolve in the direction of Singapore and Switzerland," says Khaled Sifri, CEO of UAE-based Emirates Investment Bank. "We think the UAE has all the attributes to become a successful wealth management hub. One of the differentiators for the UAE is that it is a low tax jurisdiction. It also offers a good quality of life, good services, good infrastructure and high quality facilities. It is a great place for independently wealthy people to live.”

With the basic building blocks in place, the government is keen for the sector to be developed further. “There has been a strategy communicated to banks in the UAE with a variety of objective for the coming years, and one of those is to become a serious hub for wealth management,” says Sifri.

Sifri is also chairman of the wealth management group of the UAE Banks Federation (UBF) and frequently interacts with government agencies and regulators, such as the Emirates Securities & Commodities Authority (Esca), to help develop private banking.

“There is a lot of good modern regulation that is coming through and continues to evolve, in particular when it comes to dealing with markets and investments,” he says.

Increased competition

As private banking in the UAE develops further, there will be more competition, and while this may be considered negative in other industries, for private banking it gives the UAE the critical mass needed to compete on the global stage.

“Yes, it would be helpful [to have more competition], for the purpose of making the UAE a more recognisable and attractive hub for private wealth to come and benefit from the services here,” says Sifri. “It is useful to have others doing the same thing. Then we can compete on service.”

A strong private banking sector will help the UAE avoid some of the challenges that the retail banking industry is currently facing. In recent years, large retail banks have had to change their operations as financial technology (fintech) applications automate many of the functions that were performed by people.

Jobs in private banking are also higher paid. “Jobs in private banking and wealth management require a certain amount of experience, talent and knowledge, so not your typical bureaucratic or operational type stuff,” says Sifri.