Acquisitions and subscriptions in the region seem to be the focus of attention of international banks, whose competition is burning between them to enter or expand in the region and win a share of commissions and fees, the last of which was the desire First Abu Dhabi Bank In submitting a compulsory purchase offer for a possible acquisition of a majority of no less than 51% of the issued share capital of EFG Hermes Holdings.
CitiGroup also announced its intention to expand recruitment operations to strengthen its presence in the region.
The Spanish investment bank Alantra also announced the launch of an office in Dubai to expand its international client network and win more business from the wealthiest companies and individuals in the Gulf region, in addition to other European investment banks that announced their intention to have a strong presence in the region, including the French Natixis. Standard Chartered Bank also announced its entry into the Egyptian market.
International banks are competing for a larger share of the wealth that has accumulated in the region in recent years with the rise in oil prices and the launch of reforms in the economies of the region, which has led to fierce competition among investment banks to attract billions of dollars from clients.
The size of private wealth in the Middle East is estimated at 4.7 trillion dollars.
In addition, there is a significant recovery in the activity of initial public offerings, which amounted to $23 billion in 2021, in addition to the government’s momentum – especially in the UAE and Egypt – to support the operations of future offerings by offering about ten government companies for public subscription in both the Egyptian and Dubai stock exchanges. during the coming period.
Another important reason is the attractive returns. According to the Refinitiv Investment Banking Report last year, investment banking fees in the MENA region totaled $1.4 billion last year.
Capital markets recorded their strongest year in 13 years, with revenue of $334 million from fees, which was a 251% increase over 2020.
The subscription fees for shares constituted 23% of the total fees, the highest percentage since 2008, that is, before the financial crisis.
The countries that paid the most fees in terms of market share included: Saudi Arabia with 38%, UAE (31%), Egypt (11%), Qatar (7%), and Oman with 5%.