Search the results Ahli United Bank has begun to open up the Middle East private banking business on a regional level, outperforming global rivals in the process
Ahli United Bank ranks fifth in Euromoney’s best private bank in the Middle East category, outpacing heavyweight international rivals such as Credit Suisse (6), Merrill Lynch (8) and Pictet (13) and big regional competitors including National Bank of Kuwait (7) and Saudi Arabia’s Samba (10).
AUB’s private banking success is built on its strong consumer banking franchises in key markets such as Bahrain, Kuwait and Qatar, and on its alliances with international investment managers Mellon Financial and Henderson Global Investors.
The strength of the bank’s consumer business in more than one market in the region is unique for a Middle Eastern regional bank. Regional banking champions such as NBK and Samba have offices across the region but do little business with domestic customers outside their home markets. Through its group companies – the Bank of Kuwait and the Middle East, Ahli United Bank and Ahli Bank – AUB has 10% of deposits in Kuwait, 20% in Bahrain, and 7% in Qatar.
AUB also has a joint venture with Iran’s Bank Melli Iran and Bank Saderat Iran with branches in Bahrain, the Iranian special economic zone of Kish, Qatar and Oman. In October 2000 the bank also acquired a 49% stake in Commercial Bank of Iraq.
AUB has an unusual history. It began in London in 1966 as the United Bank of Kuwait, owned by a consortium of Kuwaiti banks. It served mainly Kuwaiti expatriates in the UK until in 1998 it decided it needed to get closer to the home of its core clients. In 2000 it agreed to establish Ahli United Bank with Ahli Commercial Bank of Bahrain, with the two becoming wholly owned subsidiaries.
AUB then began accumulating a stake in Bank of Kuwait and the Middle East that now stands at 75%.
In 2004 it bought a 40% stake in Al Ahli Bank of Qatar and won a 10-year management contract.
AUB launched its private banking business in 1990. Its London and Guernsey branches focus on asset management, although larger client portfolios are managed under agreement by Mellon. UK fund manager Henderson handles its UK and European real-estate investments.
Although the private banking market has been booming in the Gulf as a result of high oil prices and the stock market, and a real estate boom, it has not been so easy for offshore private banks to reap the full rewards. “At the moment, the challenge is that Gulf equity and real estate markets are roaring, so investors are not aggressively looking for overseas opportunities,” says Adel El-Labban, group CEO and managing director of AUB. “There are thousands of new millionaires being created by the stock market and real estate booms in the region. As the boom fizzles, clients will gravitate to redeploying and diversifying their wealth through offshore private banking and investment opportunities.”
