CIA chief Pompeo says he warned Iran's Soleimani over Iraq aggression

US Central Intelligence Agency director Mike Pompeo on Saturday said that he sent a letter to Iranian Maj Gen Qassem Soleimani and Iranian leaders expressing concern regarding Iran's increasingly threatening behaviour in Iraq.

Speaking during a panel at the annual Reagan National Defence Forum in Southern California, Mr Pompeo said he sent the letter after the senior Iranian military commander had indicated that forces under his control might attack US forces in Iraq. He did not specify the date.

"What we were communicating to him in that letter was that we will hold he and Iran accountable for any attacks on American interests in Iraq by forces that are under their control," Mr Pompeo told the panel.

"We wanted to make sure he and the leadership in Iran understood that in a way that was crystal clear."

Gen Soleimani, who is the commander of foreign operations for Iran’s elite Revolutionary Guards, refused to open the letter, according to Mr Pompeo, who took over the CIA in January.

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Iran's Soleimani visits Iraqi Kurdistan amid standoff with Baghdad

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Reuters reported in October that Gen Soleimani had repeatedly warned Kurdish leaders in northern Iraq to withdraw from the oil city of Kirkuk or face an onslaught by Iraqi forces and allied Iranian-backed fighters, and had travelled to Iraq's Kurdistan region to meet Kurdish leaders.

The presence of Gen Soleimani on the front lines highlights Tehran’s heavy sway over policy in Iraq, and comes as Iran seeks to win a proxy war in the Middle East with its regional rival and US ally, Saudi Arabia.

A US-led coalition has been fighting ISIL in Iraq and Syria and is often in proximity to Iran-allied militia fighting ISIL there.

"You need to only look to the past few weeks and the efforts of the Iranians to exert influence now in Northern Iraq in addition to other places in Iraq to see that Iranian efforts to be the hegemonic power throughout the Middle East continues to increase," Mr Pompeo said.

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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.”