Credit Suisse Group AG and a unit of Qatar Investment Authority, the Persian Gulf emirate’s sovereign-wealth fund, plan to start an asset-management joint venture, three people with knowledge of the matter said.
The unit will be based in Doha and focus on Middle East and North African investments, according to one of the people, who asked not to be named and declined to give more details on the venture, citing the sensitivity of the talks. The venture may be announced this year after 12 months of negotiations between Zurich-based Credit Suisse and Qatar, two people said. It will also solicit third-party funds, according to one of the people.
Qatar and Credit Suisse are boosting ties after the nation took a 6 percent stake in the bank and bought its London headquarters. The country, which has the world’s third-largest gas reserves, is snapping up assets across the globe as it seeks to reduce its energy dependency and has $30 billion to invest this year, QIA board member Hussain Al Abdulla said in April.
Credit Suisse may “see the opportunity to use the relationships in the Gulf to build a business and cement the relationship with Qatar, which has been a big capital supporter,” said Christopher Wheeler, a London-based analyst at Mediobanca SpA.
Economic expansion and high oil prices are driving prosperity in the Middle East, boosting demand for wealth-management services. The Qatari economy is set to expand 6 percent this year, the fastest pace in the Gulf Cooperation Council, a survey of 12 economists compiled by Bloomberg shows. That surpasses the expected average growth of 1.4 percent for the Group of 10 industrialized nations.
Private wealth in the Middle East and Africa may rise 6.6 percent annually to $6.1 trillion in 2016 as the region’s oil-rich economies continue to prosper, the Boston Consulting Group said in June. Wealth in the region increased to $4.5 trillion last year, up 4.7 percent from $4.3 trillion in 2010, the consulting firm said.
Credit Suisse announced in November that it was planning to expand its product offerings in Qatar in 2012 by providing asset-management services to local and international investors, once it had secured regulatory approvals. The bank’s board of directors met in Qatar about a year ago, and the lender has also been shifting staff to Doha from Dubai, two people familiar with the matter said in September.
A spokesman for the QIA declined to comment. Sofia Rehman, a spokeswoman at Credit Suisse, also declined to comment.
The venture will expand into other emerging and frontier markets depending on its performance, one of the people said, declining to say how the business would be capitalized.
The government-run Qatar Financial Center Authority, charged with expanding the country’s financial services industry, announced a strategy in 2010 to make Qatar a hub for asset management as well as reinsurance.
Credit Suisse rose 2.8 percent to 21.81 Swiss francs at 3 p.m. in Zurich. Most bank stocks rose in Europe today after UBS AG boosted its profit target and Deutsche Bank AG reported earnings that beat analysts’ estimates.