Morgan Stanley, Rothschild among elite focusing on UAE

Rothschild & Co. and Morgan Stanley are among global investment banks opening up in Abu Dhabi as the deep-pocketed United Arab Emirates’ capital continues to attract more international money and financial firms.

The Paris-based boutique bank secured a license to operate in the Abu Dhabi Global Market, the emirate’s main business zone, according to a statement on Thursday. 

Separately, JPMorgan Chase & Co. this week said it’s expanding in the city by offering deposit taking and payment processing to its wholesale banking clients from the capital and is seeking a full banking license in ADGM. The plans signal the Wall Street firm’s “intent and commitment to the size of the opportunity here,” Chief Executive Officer Jamie Dimon said in the statement.

JPMorgan’s expansion come about a month after Morgan Stanley CEO James Gorman told analysts that the bank plans to open an outpost in Abu Dhabi. Earlier this year, Goldman Sachs Group Inc. said it was opening an office in the capital that would initially focus on asset management. 

Global investment banks are making inroads into Abu Dhabi at the same time hedge funds, private equity firms, crypto companies and asset managers are being drawn to the city that’s home to sovereign wealth funds overseeing more than $2 trillion. Ray Dalio has set up a branch of his family office in the UAE capital, while Brevan Howard Asset Management, one of the world’s biggest hedge funds, also opened an outpost in ADGM. 

TENFOLD EXPANSION

The arrival of such big names in Abu Dhabi meant that the city’s financial sector grew almost 30% on an annual basis in the second quarter, while the ADGM’s recent tenfold expansion now makes it one of the world’s largest financial districts. 

Abu Dhabi faces competition from neighboring Riyadh and Dubai which are are also expanding their financial hubs as part of efforts to diversify their oil-reliant economies. In Dubai, hedge fund heavyweights like Izzy Englander’s Millennium Management and Michael Gelband’s ExodusPoint have set up shop.

On Tuesday, Alan Howard, the billionaire co-founder of Brevan Howard, said Abu Dhabi could become a global financial center and pitched the emerging hedge fund region as the best time zone to trade for macro money managers. In a rare public appearance, Howard counted the city’s robust regulation, rule of law and favorable taxation as a lure for financial firms moving to the capital of the UAE. 

Veteran investor Rajiv Jain’s GQG Partners LLC plans to start operations in ADGM early next year, Mark Barker, head of the asset manager’s international division told Bloomberg earlier this week. The firm with more than $100 billion of assets under management plans to have about 10 to 20 people, including an investment team, based in the city by the end of 2024, he said.

Elsewhere, London-based Centricus, which oversees $40 billion in assets, received approval to open an office in ADGM and activist investor TCI Fund Management Ltd. said it would open an office in ADGM to broaden its regional investor base and support its climate action efforts.