Branching out in the Gulf

With new branches in Abu Dhabi and Doha, Intesa Sanpaolo is discovering fresh opportunities for investment in the Gulf region’s economies of tomorrow

10/04/2017

When Alessandro Rotoli opened the doors of Intesa Sanpaolo’s new Abu Dhabi branch last October, it was straight down to business. “We had a list of clients ready to work with us,” says the general manager.

Admitting his “happy surprise” at the level of enthusiasm from Italian clients and large local corporates such as Etihad Airways, Rotoli believes the bank’s presence in the capital of the UAE is important financially, strategically and politically.

“Being here – the largest of the seven emirates and the centre of government – shows the UAE that we are committed to its economy – the most open and advanced in the Middle East. We are onshore, investing, following their rules. We want to be a local player.”
Photo: Alessandro Rotoli, General Manager Abu Dhabi Branch


With the bank already established in neighbouring Dubai, Rotoli explains that the two UAE offices complement rather than compete with each other. Together they allow for a wider range of products, services and industry sector opportunities, and give clients a supported entry point into more of the Middle East.

“We now have new capabilities in local currency and local guarantees, and we can attract deposits that we could not do without being onshore in Abu Dhabi.”

In addition, Rotoli adds, Intesa Sanpaolo is well placed to work with some of the world’s largest sovereign wealth funds – including the Abu Dhabi Investment Authority, Abu Dhabi Investment Council and Mubadala Development Company – on investments around the world.

“Sustainability is a big word here,” continues Rotoli.

Masdar, a green and solar-powered city due to be completed by 2030, will house a cleantech industry hub, while last month’s Sustainability Week attracted some of the world’s most innovative thinkers on the subject. “There is space, sun and money here,” he adds.

Tourism, too, is set to grow (though Rotoli points out that this will not be on the scale of Dubai) with Etihad increasing transport connections, and both the Louvre and Guggenheim galleries opening this year.

“In the next decade thanks to the huge effort in infrastructure, we will continue to see more and more investment, population and companies,” predicts Rotoli.

“Let’s not forget that the UAE itself is only 44 years old. It is fast growing, but there are challenges in terms of culture and systems. We are here to support that growth and help our clients benefit from it.”

Also on offer to Intesa Sanpaolo clients are opportunities in Qatar, where the bank opened a new branch – the first Italian bank in the country – in Doha last October.

“Qatar is theoretically the richest country in the world, with the highest GDP per capita,” says Daniele Fanin, its general manager, “but really we are here to strengthen our regional coverage and because of the massive development plan set out in the government’s Qatar National Vision 2030.”

“The exciting thing is feeding our curiosity about new places, new people and new business”
Photo: Daniele Fanin, General Manager Qatar Branch


This roadmap for a sustainable economy and society – which will be ever less reliant on hydrocarbons – provides “an excellent platform for the bank’s work”, he says.

At this stage, Fanin continues, preparations for the 2022 World Cup are the obvious focus. “Beyond the stadium, there are roads, a metro system, satellite cities. Most companies are coming for these infrastructural projects and they need long term corporate support, structured finance and trade export finance.”

As well as attracting Italian customers, Fanin is working to build relationships with multinationals – often already banking with Intesa Sanpaolo elsewhere – and state-run funds such as the Qatar Investment Authority.

“Our target is to develop local business, but also to use our network to assist investors when they go abroad.”

The bank’s “appetite for good risk” is, Fanin adds, a further incentive for potential clients. “We cherish investment banking opportunities, but we are also ready to offer our balance sheet for the development of projects.”

Having a permanent base allows for greater access and understanding, given the nature of Qatar’s economic and political structures – “with quasi-sovereign business dominant, regulatory restriction and different cultural, behavioural, disclosure and legal codes”. These make doing business here “a challenge, but an exciting, fluid one”.

“There is a different attitude to banks that are present compared to those that are not. We are not here just for the quick win and are investing a lot in building relationships,” says Fanin. “This can look like an old-fashioned approach, but it pays off – particularly in uncertain times.”

With large gas reserves, Qatar’s diversification plan is less developed than those of some other Gulf states, but efforts to build stand-alone, sustainable industries are promising, says Fanin.

Intesa Sanpaolo’s Research Department reported last November that while the hydrocarbons component of Qatar’s GDP decreased by 2 per cent year-on-year in the first semester of 2016, the non-hydrocarbon economy registered an equivalent 5.8 per cent increase.

“The infrastructure legacy of the World Cup will help lay the foundations for long-term non-petrochemical industries – and the government is also wisely trying to develop an SME sector. In the long run all this will help build a viable alternative economy.”

Fanin is optimistic. “In many ways the opportunities we have found here are bigger than we were expecting,” he says. “The exciting thing is feeding our curiosity about new places, new people and new business.”

Related stories.