By Mirna Sleiman / Reuters
DUBAI: French lender BNP Paribas expects to grow its revenues from the oil-rich Gulf region this year despite a slight impact on its business as a result of the Arab Spring, the bank’s Middle East head told Reuters in an interview on Tuesday.
“Globally, the bank had good 2011 results and also here in the Middle East, and we expect this to continue especially from asset management and wealth management,” Jean-Christophe Durand said. “This is a very important region for BNP Paribas.”
Durand said the impact of the Arab Spring popular revolts across the region was “very minimal.”
“A lot of business of what we do here in the Gulf is with large corporates, financial institutions and governments,” he added.
Some European banks, struggling under the weight of the euro zone debt crisis, have been retrenching from lending business in the region, and Durand acknowledged BNP was currently focusing on debt structuring and financial advisory services as opposed to lending.
Across the region, the bank sees opportunities in corporate and financial advisory services, trade finance and cash management, wealth and asset management as well as debt capital markets.
For BNP, historically one of the most active players in project financing across the region, the scene is changing with more reliance on debt capital markets.
“It is clear that traditional long term financing is changing and will be done differently. We will have a bigger use of capital markets like bonds and sukuk,” said Durand.
BNP, which has its regional headquarters in Bahrain and operations in the Gulf Arab region since more than 30 years, was forced to move some of its staff and back-office operations out of Bahrain after unrest in the kingdom earlier this year.
Bahrain, a small non-OPEC oil producer was thrown into turmoil in February when protesters, mostly majority Shias, took to the streets demanding democratic reforms in the Sunni-ruled state.
Durand said the bank was staying put on the island kingdom.
“We are not moving our regional head quarters from Bahrain,” Durand said. “We are cutting staff in some businesses and in others we are hiring to adapt to new market conditions.”
Rival Societe Generale’s private banking arm plans to close its office in Bahrain as part of a cost cut move, it said in February, while Credit Agricole decided to close its office in Bahrain and move staff to neighboring Dubai last year amid unrest.
BNP recently transferred a representative office it had in Dubai to the Dubai International Financial Centre to support its wealth management business, and opened a “secondary platform” which will act as a back up to ensure business continuity in line with the bank’s global policy, Durand said.