BNY Mellon reports 245% rise in net flows into GCC equities

BNY Mellon

• BNY Mellon clients have invested $1.2bn in the GCC since 2019
• The bank intends to expand its presence in the Gulf
• BNY Mellon prefers to work with partners in the region

BNY Mellon clients’ net investments in GCC shares rocketed by 245 percent from 2019 through to the end of 2022, America’s oldest bank told AGBI.

Over this three-year period, the bank’s clients have poured $1.2 billion into Gulf equities, “outpacing emerging developed markets and the Eurozone significantly”.

The New York-headquartered bank did not supply yearly data for year-on-year comparisons.

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GCC FX volumes through the bank have increased from March 2022 to date by 8 percent. “Flows into the region reflect positive sentiment, while emerging market flows have been flat.”

“You can feel the sense of opportunity and excitement for the development of the region,” said Robin Vince, who was speaking during his first visit to the region since being appointed CEO six months ago.

He revealed that the bank intends to further expand its footprint across the GCC, which extends back nearly a century.

“There’s still interest in participating in investments, particularly in the United States, where there continues to be a lot of interest in participating in the overall American economy.”

In 2022, companies based in the Middle East raised $21.9 billion through IPOs, more than half the total for the wider Emea region, which also includes Europe and Africa, Dealogic data shows.

That momentum has continued into 2023. At the start of March, Adnoc raised $2.5 billion from the initial public offering of its gas business, recording the largest-ever listing on the Abu Dhabi Securities Exchange (ADX).

Earlier this week, analytics firm Presight, part of Abu Dhabi’s artificial intelligence outfit G42, announced plans to float on the ADX. And on Thursday UAE exchange house Al Ansari said it planned to list 10 percent of the company on the Dubai Financial Market.

“The growth of local capital markets is more of a conversation today than it probably would have been 20 years ago,” said Vince.

In December 2021 a partnership was struck between BNY Mellon and SNB Capital in Saudi Arabia to “help build a robust, market-leading and inclusive capital markets ecosystem”.

And in July last year BNY Mellon announced a strategic alliance with Emirates NBD, Dubai’s largest lender, aimed at accelerating the growth of the UAE’s capital markets, increasing investor interest through digitisation.

We’re happy to partner with a local champion in order to help them and us be able to distribute those platforms and products locally in a market,” Vince added.