UBS secures Saudi licence to open unit

Riyadh: UBS plans to start an investment and corporate banking affiliate in Saudi Arabia this year and is hoping for further expansion in other Gulf countries, the Swiss bank said on Tuesday.

The bank, which remains under the threat of more writedowns linked to the subprime crisis, has won a licence to open an investment banking branch in Saudi Arabia, the world's top oil exporter and the region's largest economy, it said in a statement.

UBS joins a growing list of western banks boosting their presence in the booming Gulf Arab region, which is struggling to manage excessive liquidity from record oil receipts and a slowdown in the industrialised economies.

Qatar plans

UBS has also applied for a licence to operate in Qatar, which has the highest GDP per capita in the world. The Swiss-based bank hopes the license will come through this year.

The Saudi operation, called UBS Saudi Arabia, will enable the bank to extend its position in wealth management in the Gulf and aims to bring its activities closer to its clients in the kingdom, John Fraser, chairman and chief executive of UBS Global Asset Management said in the statement.

Fraser will become chairman of UBS Saudi Arabia.

Vice-chairman Mohammad Al Dhoheyan, whose Development and Management House for Investments gave up its licence for UBS Saudi Arabia, said the new entity may start by the end of 2008.

UBS Saudi Arabia will focus on UBS's global core securities businesses offering international and domestic clients wealth management, asset management and investment banking services.

UBS appointed Mohammad Sammakia chief executive of UBS Saudi Arabia. Sammakia is currently managing director of UBS's fixed income division and president of the Middle East region.

UBS first set foot in the Middle East 40 years ago in Lebanon and is a founding member of the Dubai International Financial Exchange (DIFX).