The Frankfurt based Deutsche Bank is growing in the United Arab Emirates and Saudi Arabia, as the bank expects sovereign bond sales and initial public offerings (IPO) to drive deals this year.
Chief executive officer for the Middle East and Africa, Jamal Al Kishi said in a recent interview in Dubai that the Deutsche bank plans to hire staff in Dubai and Abu Dhabi for their sovereigns and large corporate divisions.
Al Kishi said that this year they are definitely more optimistic on the outlook for deals across sovereign bond sales, privatizations and equity capital markets. He added that they also expect to see a lot of private sector companies tapping into both debt and equity markets.
The bank’s expansion plans in the Middle East comes as it is said to have begun cutting at least 250 jobs worldwide at its corporate and investment bank divisions to temper down expenses so as to balance losses from its securities unit.
According to people familiar with the matter, the bank recently trimmed senior and mid-level investment banking positions in locations such as the US and London in the past few weeks.
The head of wealth management for Europe, the Middle East and Africa and Switzerland, Peter Hinder said in an interview in July that the Deutsche Bank is setting its sights on the Middle East as a region of priority for wealth management and is looking to employ relationship managers. The bank is also hoping to add value to the products it provides to wealthy clients in the region.
According to data from Bloomberg, Deutsche Bank was the eighth biggest manager of bond and Sukuk-al-Islam deals within the Gulf Cooperation Council countries last year as regional sales increased by 18% to a record $85 billion. As a result of the fall in crude prices over the last two years, oil exporting countries are tapping debt markets to boost public finances.
Al Kishi said that they expect the 2018 and 2019 deal flow to be driven by sovereign bond sales as the authorities do their best to meet their budgetary targets. He said that should markets continue being stable, they anticipate a good increase in deal volumes coming to the regional markets this fiscal year.
Al Kishi also said that Deutsche Bank has shown a firm institutional and real money interest in the Saudi story, after the bank’s recent client meetings with Saudi financial authorities.