Jamal Al Kishi was appointed chief executive of Deutsche Bank’s operations in the Middle East and Africa in February, at a time when the German banking leader was facing challenges in its international businesses and threats from American regulators. In his first interview since taking the job, Mr Al Kishi, a career banker in his native Saudi Arabia, gives his view of the global economic environment, the financial challenges facing Deutsche and its long-term role in the UAE banking scene.
How do you view the world economic background to Deutsche’s business?
There is an increased risk profile and anxiety in the global macro picture. The pace of growth in China and other emerging market economies has slowed, but there are signs of bottoming across several large economies and we expect a moderate growth pick-up in 2017. The US is growing anaemically, not fast enough to be the locomotive of the global economy. Trade and commodities are down and equities are volatile. Furthermore, the geopolitical scene is not conducive to optimism. But there are some positive elements. There is some form of stabilisation in commodity and oil markets and now we think the oil price might finish the year nearer to US$60 than $20. Our previous estimate was $45, and now we think that might be conservative.
Some European banks view the UK’s Brexit vote as an opportunity to win business from London. How do you see it?
Brexit has caused great uncertainty and that is not positive for a globally networked economy. The UK is weaker without Europe, and Europe is weaker without the UK. I hope the Brexit negotiations are done in a thoughtful manner. We are still not clear on what structure there will be to future EU-UK relations. Deutsche employs over 8,000 people in the UK and is one of the largest employers in the City. As a bank headquartered in Germany and with a strong presence in the UK, we are well prepared to mitigate the consequences of the UK leaving the EU. We have a base and an infrastructure ready and waiting for us in Frankfurt should a move prove necessary.
The American authorities have suggested a fine as high as US$14 billion as a punishment for mis-selling certain securities. What’s the latest?
With regard to the fines that have been talked about for us, I can only say we are in constructive discussions with the Department of Justice and we are working hard on achieving a resolution of the matter as soon as possible.
When the possible scale of the fine was revealed, it caused worries about Deutsche’s financial health. Was this justified?
Deutsche Bank is fundamentally a much safer and more secure organisation than it was before the global financial crisis. Since then, we have more than doubled our shareholder capital, our balance sheet has been reduced and we have increased liquidity reserves. Over 70 per cent of the balance sheet is funded by long-term, diversified stable sources. Our share price has been impacted by our ongoing negotiations with the DoJ, concerns around Brexit and continued weakness in the euro-zone economies – our home base, if you like. But we do not see a need for further capital raising, not at this time. We have sufficient capital, and have provisioned for future expenses related to litigation. And, of course, the engine is still working. The results of the third quarter demonstrate the operating strengths of our business.
[The bank reported a net profit for the quarter of €1.47bn (Dh5.97bn), up by 78.1 per cent from a year earlier.]
Deutsche is in the middle of a downsizing exercise involving withdrawal from some global markets. Will this affect the Middle East business?
Our commitment to this region is undiminished. If anything, we see the merit in investing further here. We were involved in the sovereign bonds in Saudi and Qatar. We were joint lead manager on DP World’s $1.2bn sukuk and Pakistan’s $1bn sukuk this year and see more of this kind of business coming, in sovereign and corporate debt. We are recognised as having a leading trade finance, cash management and custody platform across the region.
Tell me more about Saudi Arabia, where you have strong relationships.
We’re very bullish about the outlook that’s been created by the Vision 2030 strategy. It shows the dynamism and the will to reform and modernise the country. As a Saudi, it’s especially gratifying for me and it will create opportunities for banks like us across the board: equity and debt capital markets, M&A, structured finance and forex. I’m still the CEO of the Deutsche Saudi operation so that gives me a hands-on role in all that’s happening there.
How do you see the macro-environment in the UAE?
Here I think some have taken too pessimistic a view on the effect of the oil decline and in particular the effect on some high levels of debt. Of course, prices are down and there is fiscal pressure on governments, so it’s natural the credit portfolios of some banks are under some strain. But the system is robust enough to withstand this and resume its upward trajectory. It is nothing like as bad as 2009. It’s not even appropriate to compare it with that time.
What are the top items in your in-tray for UAE business?
The pipeline of UAE activity into 2017 is robust along our traditional lines of business. We’re seeing good opportunities in infrastructure finance and export credit agency financing, which is in line with Dubai’s Expo 2020 strategy. We’re involved in various M&A and structured finance discussions in the UAE. Additionally, we are very determined in our wealth management business, where we focus on very wealthy clients. We have invested significantly in our Dubai offices and feel well positioned for continued growth in this important sector.
Will Dubai creditors be able to restructure obligations where necessary?
We think they will. The new insolvency law seems to strike a good balance, taking into account the interests of both debtors and creditors. It reportedly has a broad range of clauses for creditors around restructuring. So a good move in the right direction in our view.
What is the Deutsche take on the UAE equity market? Will there be an upturn in market activity next year?
Most Mena markets have struggled for direction this year, with Saudi Arabia the notable exception with a double-digit decline. Next year, we expect the oil price to recover on the back of tighter supply and demand conditions. This will set the scene for a more positive backdrop and we expect market participants to regain confidence in the region’s long-term growth potential. As a result Mena equities should enjoy a more positive trend in 2017.
What is the bank’s view on the Abu Dhabi Global Market?
We’ve been watching the steady progress of ADGM with interest and have been impressed with the way they have cautiously and without haste implemented their strategy, which is in line with Abu Dhabi’s own 2030 strategy towards economic diversification. We are confident that as a founding member of the DIFC and with an existing branch office in Abu Dhabi, we are well positioned to capitalise on future business opportunities here in the UAE.
fkane@thenational.ae
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The specs
Engine: 77.4kW all-wheel-drive dual motor
Power: 320bhp
Torque: 605Nm
Transmission: Single-speed automatic
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On sale: Now
ESSENTIALS
The flights
Fly Etihad or Emirates from the UAE to Moscow from 2,763 return per person return including taxes.
Where to stay
Trips on the Golden Eagle Trans-Siberian cost from US$16,995 (Dh62,414) per person, based on two sharing.
FA Cup quarter-final draw
The matches will be played across the weekend of 21 and 22 March
Sheffield United v Arsenal
Newcastle v Manchester City
Norwich v Derby/Manchester United
Leicester City v Chelsea
Guide to intelligent investing
Investing success often hinges on discipline and perspective. As markets fluctuate, remember these guiding principles:
- Stay invested: Time in the market, not timing the market, is critical to long-term gains.
- Rational thinking: Breathe and avoid emotional decision-making; let logic and planning guide your actions.
- Strategic patience: Understand why you’re investing and allow time for your strategies to unfold.
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
Dubai Bling season three
Cast: Loujain Adada, Zeina Khoury, Farhana Bodi, Ebraheem Al Samadi, Mona Kattan, and couples Safa & Fahad Siddiqui and DJ Bliss & Danya Mohammed
Rating: 1/5
German intelligence warnings
- 2002: "Hezbollah supporters feared becoming a target of security services because of the effects of [9/11] ... discussions on Hezbollah policy moved from mosques into smaller circles in private homes." Supporters in Germany: 800
- 2013: "Financial and logistical support from Germany for Hezbollah in Lebanon supports the armed struggle against Israel ... Hezbollah supporters in Germany hold back from actions that would gain publicity." Supporters in Germany: 950
- 2023: "It must be reckoned with that Hezbollah will continue to plan terrorist actions outside the Middle East against Israel or Israeli interests." Supporters in Germany: 1,250
Source: Federal Office for the Protection of the Constitution
Paatal Lok season two
Directors: Avinash Arun, Prosit Roy
Stars: Jaideep Ahlawat, Ishwak Singh, Lc Sekhose, Merenla Imsong
Rating: 4.5/5
Learn more about Qasr Al Hosn
In 2013, The National's History Project went beyond the walls to see what life was like living in Abu Dhabi's fabled fort:
Emergency
Director: Kangana Ranaut
Stars: Kangana Ranaut, Anupam Kher, Shreyas Talpade, Milind Soman, Mahima Chaudhry
Rating: 2/5
Five famous companies founded by teens
There are numerous success stories of teen businesses that were created in college dorm rooms and other modest circumstances. Below are some of the most recognisable names in the industry:
- Facebook: Mark Zuckerberg and his friends started Facebook when he was a 19-year-old Harvard undergraduate.
- Dell: When Michael Dell was an undergraduate student at Texas University in 1984, he started upgrading computers for profit. He starting working full-time on his business when he was 19. Eventually, his company became the Dell Computer Corporation and then Dell Inc.
- Subway: Fred DeLuca opened the first Subway restaurant when he was 17. In 1965, Mr DeLuca needed extra money for college, so he decided to open his own business. Peter Buck, a family friend, lent him $1,000 and together, they opened Pete’s Super Submarines. A few years later, the company was rebranded and called Subway.
- Mashable: In 2005, Pete Cashmore created Mashable in Scotland when he was a teenager. The site was then a technology blog. Over the next few decades, Mr Cashmore has turned Mashable into a global media company.
- Oculus VR: Palmer Luckey founded Oculus VR in June 2012, when he was 19. In August that year, Oculus launched its Kickstarter campaign and raised more than $1 million in three days. Facebook bought Oculus for $2 billion two years later.
THE SPECS
Engine: 6.75-litre twin-turbocharged V12 petrol engine
Power: 420kW
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COMPANY PROFILE
Founders: Alhaan Ahmed, Alyina Ahmed and Maximo Tettamanzi
Total funding: Self funded
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COMPANY%20PROFILE
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A Long Way Home by Peter Carey
Faber & Faber
Our legal consultant
Name: Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants
ETFs explained
Exhchange traded funds are bought and sold like shares, but operate as index-tracking funds, passively following their chosen indices, such as the S&P 500, FTSE 100 and the FTSE All World, plus a vast range of smaller exchanges and commodities, such as gold, silver, copper sugar, coffee and oil.
ETFs have zero upfront fees and annual charges as low as 0.07 per cent a year, which means you get to keep more of your returns, as actively managed funds can charge as much as 1.5 per cent a year.
There are thousands to choose from, with the five biggest providers BlackRock’s iShares range, Vanguard, State Street Global Advisors SPDR ETFs, Deutsche Bank AWM X-trackers and Invesco PowerShares.
How to apply for a drone permit
- Individuals must register on UAE Drone app or website using their UAE Pass
- Add all their personal details, including name, nationality, passport number, Emiratis ID, email and phone number
- Upload the training certificate from a centre accredited by the GCAA
- Submit their request
What are the regulations?
- Fly it within visual line of sight
- Never over populated areas
- Ensure maximum flying height of 400 feet (122 metres) above ground level is not crossed
- Users must avoid flying over restricted areas listed on the UAE Drone app
- Only fly the drone during the day, and never at night
- Should have a live feed of the drone flight
- Drones must weigh 5 kg or less
Other workplace saving schemes
- The UAE government announced a retirement savings plan for private and free zone sector employees in 2023.
- Dubai’s savings retirement scheme for foreign employees working in the emirate’s government and public sector came into effect in 2022.
- National Bonds unveiled a Golden Pension Scheme in 2022 to help private-sector foreign employees with their financial planning.
- In April 2021, Hayah Insurance unveiled a workplace savings plan to help UAE employees save for their retirement.
- Lunate, an Abu Dhabi-based investment manager, has launched a fund that will allow UAE private companies to offer employees investment returns on end-of-service benefits.
The National Archives, Abu Dhabi
Founded over 50 years ago, the National Archives collects valuable historical material relating to the UAE, and is the oldest and richest archive relating to the Arabian Gulf.
Much of the material can be viewed on line at the Arabian Gulf Digital Archive - https://www.agda.ae/en
'Worse than a prison sentence'
Marie Byrne, a counsellor who volunteers at the UAE government's mental health crisis helpline, said the ordeal the crew had been through would take time to overcome.
“It was worse than a prison sentence, where at least someone can deal with a set amount of time incarcerated," she said.
“They were living in perpetual mystery as to how their futures would pan out, and what that would be.
“Because of coronavirus, the world is very different now to the one they left, that will also have an impact.
“It will not fully register until they are on dry land. Some have not seen their young children grow up while others will have to rebuild relationships.
“It will be a challenge mentally, and to find other work to support their families as they have been out of circulation for so long. Hopefully they will get the care they need when they get home.”
Formula Middle East Calendar (Formula Regional and Formula 4)
Round 1: January 17-19, Yas Marina Circuit – Abu Dhabi
Round 2: January 22-23, Yas Marina Circuit – Abu Dhabi
Round 3: February 7-9, Dubai Autodrome – Dubai
Round 4: February 14-16, Yas Marina Circuit – Abu Dhabi
Round 5: February 25-27, Jeddah Corniche Circuit – Saudi Arabia
Schedule
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'Doctor Strange in the Multiverse Of Madness'
Director: Sam Raimi
Cast: Benedict Cumberbatch, Elizabeth Olsen, Chiwetel Ejiofor, Benedict Wong, Xochitl Gomez, Michael Stuhlbarg and Rachel McAdams
Rating: 3/5
How to avoid crypto fraud
- Use unique usernames and passwords while enabling multi-factor authentication.
- Use an offline private key, a physical device that requires manual activation, whenever you access your wallet.
- Avoid suspicious social media ads promoting fraudulent schemes.
- Only invest in crypto projects that you fully understand.
- Critically assess whether a project’s promises or returns seem too good to be true.
- Only use reputable platforms that have a track record of strong regulatory compliance.
- Store funds in hardware wallets as opposed to online exchanges.
Five hymns the crowds can join in
Papal Mass will begin at 10.30am at the Zayed Sports City Stadium on Tuesday
Some 17 hymns will be sung by a 120-strong UAE choir
Five hymns will be rehearsed with crowds on Tuesday morning before the Pope arrives at stadium
‘Christ be our Light’ as the entrance song
‘All that I am’ for the offertory or during the symbolic offering of gifts at the altar
‘Make me a Channel of your Peace’ and ‘Soul of my Saviour’ for the communion
‘Tell out my Soul’ as the final hymn after the blessings from the Pope
The choir will also sing the hymn ‘Legions of Heaven’ in Arabic as ‘Assakiroo Sama’
There are 15 Arabic speakers from Syria, Lebanon and Jordan in the choir that comprises residents from the Philippines, India, France, Italy, America, Netherlands, Armenia and Indonesia
The choir will be accompanied by a brass ensemble and an organ
They will practice for the first time at the stadium on the eve of the public mass on Monday evening
Biography
Favourite Meal: Chicken Caesar salad
Hobbies: Travelling, going to the gym
Inspiration: Father, who was a captain in the UAE army
Favourite read: Rich Dad Poor Dad by Robert Kiyosaki and Sharon Lechter
Favourite film: The Founder, about the establishment of McDonald's
UPI facts
More than 2.2 million Indian tourists arrived in UAE in 2023
More than 3.5 million Indians reside in UAE
Indian tourists can make purchases in UAE using rupee accounts in India through QR-code-based UPI real-time payment systems
Indian residents in UAE can use their non-resident NRO and NRE accounts held in Indian banks linked to a UAE mobile number for UPI transactions
COMPANY PROFILE
Name: Almnssa
Started: August 2020
Founder: Areej Selmi
Based: Gaza
Sectors: Internet, e-commerce
Investments: Grants/private funding
The specs
Engine: 3-litre twin-turbo V6
Power: 400hp
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Transmission: 9-speed automatic
Price: From Dh215,900
On sale: Now
Janet Yellen's Firsts
- In 2014, she became the first woman to lead the US Federal Reserve
- In 1999, she became the first female chair of the White House Council of Economic Advisers