The U.K. lender, which is cutting 7,000 investment banking jobs over the next two years, plans to increase the number of corporate bankers in the Gulf by more than 10 percent this year, Rezwan Mirza, head of that business in the United Arab Emirates and Gulf countries, said in a May 26 interview in Dubai. He declined to give more detail on banker numbers.
Mirza said operations in the six-nation Gulf Cooperation Council won’t be affected by the plan announced on May 8 to cut a quarter of employees at the investment bank and 19,000 jobs across the company. Chief Executive Officer Antony Jenkins is focusing on cutting costs, rebuilding relations with regulators and responding to shareholder demands to curb bonuses.
Barclays is pursuing growth in emerging markets such as Africa, while scaling back its investment bank in the U.S. and Asia. The bank is injecting fresh capital into its African business as returns from the continent exceed its 2016 profitability targets, Stephen van Coller, head of Barclays’s Johannesburg-based Absa Capital unit, said in May 14 interview.
“From where I am sitting, the only pressure I have from my London headquarters is how quickly we can position ourselves to grow,” Mirza said. “For us, it’s been business as usual across all divisions of the bank here.”
Barclays agreed to sell its retail banking business in the United Arab Emirates to Abu Dhabi Islamic Bank PJSC (ADIB) for 650 million dirhams ($177 million) in April. The bank will maintain its branch presence in Dubai and Abu Dhabi for its corporate clients in the U.A.E., Mirza said.
Economic growth in the Gulf Arab region is accelerating amid higher oil prices, increased infrastructure spending by states and a revival in property prices. The UAE’s economy expanded 4.8 percent in 2013, the fastest pace in seven years, according to data compiled by Bloomberg.
Companies are expanding into places such as Africa, creating opportunities for Barclays, Mirza said. The London-based bank increased lending to trade finance customers by more than 15 percent this year, he said.
“Pretty much everyone I meet in the region say that their business is growing,” Mizra said.“When your business is growing, you need to grow your working capital.”
Barclays participated in eight transactions in the loan market by companies such as Dubai port operator DP World Ltd. and Abu Dhabi investment fund Mubadala Development Co PJSC last year, according to data compiled by Bloomberg.
The bank expects to see more borrowers tap the loan market to refinance existing debt facilities and also seek fresh capital, the executive said.
“From a borrower’s perspective, there is liquidity in the market and rates are low so it’s time for them to look at reducing their funding costs.”
To contact the reporter on this story: Dinesh Nair in Dubai at email@example.com