Singapore's DBS considers plans to expand presence in Dubai

One of Asia's biggest lenders aims to use emirate as a base for better access to other markets in the Middle East and Africa

Singapore's DBS established its operations at the Dubai International Finance Centre in 2006. AFP

Singapore’s DBS Bank, one of the biggest lenders in Asia, plans to boost its presence in Dubai and use the emirate as a hub to better access other markets and source business in the broader Middle East and Africa region, its group chief executive said.

The bank is currently in the process of reviewing business plans for strengthening its base in Dubai, the commercial and trading hub of the Middle East, Piyush Gupta told delegates at the Dubai FinTech Summit on Tuesday.

“I think the south-south corridors are really picking up and that includes not just the Middle East, it also includes Africa into Asia,” he said.

“I think Dubai is a really great location to be able to centre activities from here and we already do that for wealth management. You can do that for a lot of stuff [including] the East African corridor, the Saudi corridor and the Middle East corridor.”

Taking advantage of the south-south trade and the capital flows by leveraging its presence in Dubai “to me is the low hanging fruit first”, he said of the bank’s plans for the wider region in the next five to 10 years.

DBS is among several banks, hedge funds and other financial institution that are looking to boost their presence in the Dubai and use their base in emirate to access business in other regional markets including Saudi Arabia, the Arab world’s biggest economy.

Dubai International Financial Centre, one of the biggest financial hubs in the Middle East Africa and South Asia, is home to 17 of the world’s top 20 banks, 25 of the world’s top 30 “systemically important” global financial institutions and five of the world's top 10 global insurance companies.

The emirate’s direct connectivity with Asia, Africa, the Middle East and markets in Europe as well as the ease of trade and capital flows to and from the emirate to these regions make it a favoured destination for financial institutions.

The financial centre grew at a record pace last year, with the number of active registered companies climbing by 20 per cent while its annual revenue exceeded Dh1 billion ($288 million) for the first time, amid the emirate's strong economic momentum.

The centre has a pipeline of more than 50 hedge funds, with more than $1 trillion in assets under management that are waiting to be licensed, DIFC governor Essa Kazim said in February.

Total banking assets booked in the DIFC hit $199 billion at the end of 2022, while wealth and asset management portfolio managers in the centre invested $164 billion last year.

DBS established its DIFC operations in 2006, becoming the first Singapore-headquartered lender to receive a licence to operate from the centre.

It offers wholesale banking products and services including corporate and investment banking, debt and capital markets, treasury management, institutional equity sales and global transaction services.

It also caters to private banking customers in the region through its Dubai base, according to its website.

In 2010, DBS’ licence was upgraded to category 1, which permits the lender to book loans and carry out trade finance activities locally.

There are a lot of similarities between Singapore and Dubai and hubs such as these have a vital role to play in a multi-polar world, facilitating trade and capital flows to and from markets in the West and the East, Mr Gupta said.