Dubai: French banking behemoth Société Générale is ready to deploy more capital and resources in the Gulf region particularly in Dubai and Abu Dhabi, the bank’s Chairman and Chief Executive, Frédéric Oudéa told Gulf News in an interview.
“We are very committed to the region. The Gulf market is going to be a key component of our growth strategy. Dubai, Abu Dhabi and the rest of the GCC are very important in our plans for balance sheet expansion in this region,” said Oudéa.
Société Générale which cleaned up its balance sheet and built up strong capital buffers following the global financial crisis and European sovereign crisis said, it is ready to deploy capital in the Gulf region which has significantly higher economic growth compared to many countries across the world.
“We are going to put more capital and liquidity at work to fuel organic growth in this region. We are going to selectively recruit more people on the ground in certain areas of expertise to accompany the growth of our business flow, and deploy more resources in the region” he said.
The expansion in the Gulf is going to be focused on the wholesale banking, especially structured finance activities such as advisory and arranging of project finance in various key sectors,The bank believes that the region has huge opportunities in infrastructure developments such as oil and gas projects, power projects, airport, port, motor way, and other infrastructure financing, industrial clusters and companies that want to expand into international markets.
“We are well positioned to play an active role in funding some of these projects. On the one hand we are a leader in project finance and energy finance. In power we have world leading expertise and can provide financing with a mix of loans and access to capital markets,” said Oudéa.
Available liquidity
Société Générale sees the Gulf region as an important market as it meets the bank’s expectations on safety, security and return on capital. “There is a lot of liquidity available to be deployed, but we have to be mindful of the safety, quality of assets we acquire and the returns. Considering these factors we believe there lots of opportunities in the Gulf region,” said Oudéa.
He said there is ample opportunity for companies from these regions to raise relatively cheap capital from Europe and the US for commercially sound projects.
A number of international banks, particularly European banks curtailed their medium to long term funding activities in the Middle East region following the financial crisis. The bank sees huge potential for project financing in the region. With its presence in 80 countries, the bank says it can provide access to capital markets across the world.
Société Générale is also keen on expanding business in the high growth African markets. With a number of Middle East companies expanding into Africa, the bank wants to leverage on its presence in both regions to augment business.
“With a number of large companies from the Middle East seeking to expand internationally, we see an opportunity to support these businesses with our global presence,” said Oudéa.
