Dubai: A large segment of high networth individuals (HNWIs) from GCC countries prefer local and regional banks to global wealth managers in managing their wealth according to the findings of GCC Wealth Insight Report by Emirates Investment Bank.
Regional HNWIs are also more likely to have a local rather than international bank to help manage their wealth compared to last year, with 80 per cent saying they prefer to use a local bank compared to 59 per last year, the survey results showed.
A large number of respondents said they believe that local banks provide easier access, have a better understanding of the local market or regulations, and are safer. The top four factors for selecting a local bank have not changed since last year — HNWIs look for level of service, bank reputation and brand, fees and pricing, and investment expertise and global access.
The survey showed that an overwhelming majority of GCC HNWIs (83 per cent) are more likely to invest in assets closer to home due their confidence in their local economy’s stability and security (39 per cent) and ability to control and oversee their investments easily (20 per cent).
GCC HNWIs who invest globally (18 per cent) do so mainly to take advantage of global opportunities and diversify their risk. In the next 3-5 years, global investors from the GCC are expected to be regionally focused, with 29 per cent seeing the GCC as their best investment destination.
In terms of asset classes, the survey showed that GCC’s wealthy still prefer to invest their wealth in their own businesses (33 per cent) and in real estate (30 per cent); almost same as last year (34 per cent and 25 per cent respectively) rather than stocks and bonds.
About 81 per cent, or eight in ten expect to increase investments in real estate and 64 per cent or about two thirds expect to increase investment in their own business in the near future; compared to 65 per cent each, respectively last year. A large majority of GCC’s wealthy (84 per cent) are persistently more focused on growing than preserving their wealth.
“There are strong signs of moving beyond the days of the financial crisis, albeit with a more cautious and perhaps more regional investment approach. We believe that the continued growth-focused attitude of regional entrepreneurs reinforces the positive outlook for the GCC region and global economy in the coming years,” said Khaled Sifri, CEO of Emirates Investment Bank.