RBS plans Gulf investment banking growth
Investment banking revenues in the Gulf, as we pointed out last week, have stalled of late, which makes it seem like an odd time for Royal Bank of Scotland to pull back from retail and focus on wholesale banking in the region.
RBS is about sell its retail business in the Gulf to Abu Dhabi Commercial Bank - a decision announced in June - and has said that it intends to bolster its investment banking business instead.
Simon Penney, RBS's chief executive officer for the MENA region, says that he anticipates a rebound of the region's debt markets in the last part of this year, following the agreement around Dubai World's restructuring.
"We certainly anticipate an up-tick in issuance in the deal flows in the next two-and-a-half months going into December - probably exceeding what we saw during the first eight months of the year," he said.
He also confirmed that the bank was working on six live transactions (presumably not the same six highlighted earlier in the year) that could lead to "significant bond issuances".
If RBS starts to hire in significant numbers, it'll be a statement of intent (and confidence) that the investment banking recruitment badly needs currently.
However, much of the growth is likely to be outside of its Dubai operations.
"My challenge is to grow that business to the right size and right shape. The right shape for me is a Middle Eastern and Africa business and not a Dubai-only business," said Penney.
