Digital bank Revolut secures key authorization for UAE launch
Digital bank Revolut is launching its services in the UAE after gaining key authorization following a protracted approval process.
The London-based firm said that the UAE’s Central Bank had okayed its application for so-called stored value facilities and retail payment services, Bloomberg reports.
It now plans to build out its local operations before going live. Revolut has been planning to launch since it secured “in-principle” approvals in September last year.
Historically, it has been complex for so-called neobanks to enter the Gulf market, where traditional banks have dominated.
However, since the emergence of homegrown digital banks including Wio, Mashreq Neo and Liv — all tied to major UAE lenders — the market has started to open up.
London-based money transfer company Wise also recently secured approvals, and homegrown Islamic digital finance startup Fasset has been expanding its services.
UAE maps strategy to protect Gulf shipping from renewed threats
UAE Minister of State for Foreign Trade Thani Al Zeyoudi offered a glimpse today at how government planners are trying to prevent a repeat of Iran’s chokehold over Gulf shipping. “We want to make our dependency on the Strait of Hormuz close to zero,” Al Zeyoudi said in an interview with Bloomberg.
A key part of the strategy is the emirate of Fujairah, where the government has spent years building infrastructure to bypass the narrow waterway. ADNOC already operates a pipeline that can carry up to 1.5 million barrels of crude a day directly from Abu Dhabi to Fujairah, and is developing a second line that would further increase export capacity.
Al Zeyoudi said the UAE is also investing in rail links, ports and overland trade corridors that can move goods between Asia, the Middle East and Europe without relying on a single maritime route.
The aftermath of the Strait of Hormuz crisis will also be prominent at this week’s Saudi Arabia’s FII Priority Europe conference in Rome.
Opening the formal proceedings on Thursday will be PIF Governor Yasir Al-Rumayyan, who will be joined by Saudi Tourism Minister Ahmed Al-Khateeb, Princess Reema bint Bandar, the Saudi Ambassador to the U.S., and a full roster of government officials.
Among European leaders on the schedule are Albanian Prime Minister Edi Rama, former Italian Prime Minister Matteo Renzi and Italian Industry Minister Adolfo Urso.
Speakers include Anthony Gutman, Co-CEO of Goldman Sachs International; Andrew Cohen, executive chairman of JPMorgan Chase’s global private bank; Lord Franck Petitgas, Vice Chairman of Blackstone Europe; Sir Noel Quinn, Chairman of Julius Baer; Mohamed Alabbar, founder of Emaar Properties; and Gerard Inzerillo, Group CEO of Diriyah Co.
UAE minister woos Silicon Valley investment firms on U.S. tour
From meeting U.S. policymakers face-to-face in Washington to chatting with OpenAI execs in San Francisco, UAE Minister of State for Foreign Trade and Talent Attraction Thani Al Zeyoudi says his cross-country tour last week should pay dividends in relationship-building abroad.
Along with a raft of discussions about artificial intelligence “as the defining technology of our era,” Al Zeyoudi’s Silicon Valley sojourn put him in direct contact with a wide gamut of Silicon Valley investment firms, he said on Tuesday in a LinkedIn post.
Those included TPG, Thoma Bravo, Viking Global Investors, Lux Capital, Khosla Ventures, Brave Capital, Audere Capital, Flagship Capital Management, General Catalyst and Mubadala Ventures – which the minister called “sources of capital formation being directed to bleeding-edge technologies shaping the world today.”
He said companies including Flexport, Interos, Lightmatter and Lila Sciences were “keen to explore partnerships with the UAE.”
Reflecting on the SelectUSA Investment Summit in suburban Washington D.C., where he was a keynote speaker, Al Zeyoudi noted his meetings with U.S. Secretary of Commerce Gina Raimondo and New Jersey Gov. Phil Murphy as especially useful in kindling American-Emirati collaboration.
“While we shared non-oil trade of $40 billion in 2023, I believe our nations have only touched the surface of bilateral opportunity,” Al Zeyoudi said. “Sectors such as renewable energy, sustainability, biotechnology, life sciences, finance, and logistics are all ripe for further development.”
Abu Dhabi’s AI-focused energy company AIQ, meanwhile, announced a partnership agreement on Monday with Texas-based Halliburton’s Landmark unit to help expand the use of AI tools in oil and gas production.
AI will deliver ‘artisanal’ financial guidance, UAE minister predicts
With Dubai soaked from another late-season storm, UAE Minister of State for Artificial Intelligence Omar Al Olama mounted the stage at the annual Capital Market Summit on Thursday wearing rubber sandals.
Before delivering a peek into the country’s AI future, the minister had to navigate his way to the correct location at Dubai’s Madinat Jumeirah Conference and Events Centre as the main stage was damaged by rain.
Addressing how AI will affect the world of finance, Al Olama offered three predictions.
No. 1: Stronger firewalls will be erected to limit the amount of information that can be freely scraped from the internet. No. 2: Investors will see the rise of “artisanal” large language models to guide them through such thickets as hedging, ETFs and shariah-compliant lending. No. 3. Overuse of AI will lead to a “big catastrophic financial event.”
Roaming the conference halls was one business executive from Hong Kong who was seeking connections for big tech and EV clients back in China. With an eye toward potential dual listings, she noted that Chinese companies have yet to go public on the Dubai Financial Market, but they are seeing opportunities reminiscent of the go-go days of China’s biggest city. “Dubai in 2024 is Shanghai in 2004,” she said.
Heavy rain, wind and lightning hit the UAE overnight, with flooding on roads in Dubai and Abu Dhabi, and trees uprooted in some areas. Dubai International Airport canceled 13 flights and intercity bus services have been suspended. Schools held classes online while students stayed home and many businesses allowed employees to work remotely.
The latest downpours come as the emirates, particularly Dubai, are still recovering from extreme weather that brought record rain and flooding two weeks ago.
UAE offer for Israeli insurer paves way for more deals, minister says
TEL AVIV, Israel – While regulators scrutinize a bid from the United Arab Emirates for Israel’s largest insurance company, the Gulf state will be looking to broaden its interests in the Israeli financial services industry, Minister of State for Foreign Trade Thani Al Zeyoudi told The Circuit.
Al Zeyoudi said the offer last week from a consortium led by Abu Dhabi-based ADQ for a controlling stake in Israel’s Phoenix Group was “just another signal that relations are going to grow.” Israeli insurers, financial services companies and fintech startups are among the most attractive candidates for partnerships and acquisitions, he said.
In a video interview from his office in Abu Dhabi, the UAE’s capital, Al Zeyoudi also said he expects ties between the two countries to strengthen under returning Israeli Prime Minister Benjamin Netanyahu. He said the free-trade agreement that the UAE and Israel ratified on Dec. 11 would likely reach its goal of generating an annual $10 billion in bilateral economic activity by 2026, two years ahead of the ministry’s earlier projections. Two years after the UAE, Bahrain, Morocco and Sudan signed agreements to normalize relations with Israel, he said more Arab countries are getting ready to engage with the Jewish state.
“There is a growing appetite across the region for collaboration and cooperation,” Al Zeyoudi said. “There are now six countries in the Arab world that have recognized Israel and the benefits of these ties will accumulate as trade flows increase. Obviously, we cannot decide for other countries because it’s [a matter of] sovereign rights. But I’m sure through these engagements and the results from our economic and bilateral trade, it’s a signal to everyone how important and how powerful this cooperation is.”
In his own efforts to understand the Israeli financial services market, Al Zeyoudi said he developed a warm relationship with Samer Haj-Yehia, chairman of Bank Leumi, Israel’s largest lender. Haj-Yehia, an Arab citizen of Israel, was a surprise speaker in October at the mammoth Future Investment Initiative conference in Saudi Arabia, even though the two countries do not have diplomatic relations. Al Zeyoudi first met the banker during a meeting with Israeli business leaders in Dubai on Sept. 15, 2020, the day the Abraham Accords were signed in Washington. “Since then, the relationship is very close with him,” Al Zeyoudi said. Haj-Yehia, who also spoke at conferences in the UAE last month, acknowledged through a Leumi spokesman that he has met with the Emirati minister and declined to comment further.
Al Zeyoudi, 40, who was previously minister of climate change and the environment, studied at the University of Tulsa in Oklahoma for a bachelor’s degree in petroleum engineering. He earned an MBA at the New York Institute of Technology and later went to the SKEMA Business School in Lille, France, for a PhD in strategy, program and project management.
In the insurance deal, Al Zeyoudi said ADQ, a holding company owned by the Abu Dhabi emirate, is prepared to confront concerns expressed in Israel about foreign control of Phoenix, the largest manager of employee pension funds. The investment group it leads signed a term sheet last week with Phoenix’s controlling shareholders, U.S. investment firms Centerbridge Partners and Gallatin Point Capital, to buy between 25-30% of the company’s shares for as much as $800 million.
“It’s all been studied very well and thoroughly from both sides,” he said. “No deals will be signed without the full picture [being] put on the table, being discussed, being tackled, and then we move on to the next level.”
The Marker, an Israeli financial newspaper, called the proposed sale “an irresponsible and unprecedented act of folly” because it gives the UAE too much power over the pension savings of Israeli citizens. A 2017 bid by China’s Fujian Yango Group to buy control of Phoenix was withdrawn after it was rejected by Israel’s Capital Market, Insurance and Savings Authority.
If ADQ’s offer is accepted by the regulator, the deal would be one of the biggest between the UAE and Israel since the Abu Dhabi sovereign wealth fund Mubadala bought a 22% stake in an offshore Israeli natural gas field last year for $1 billion.
“It probably won’t be approved easily and it won’t be a quick decision,” said Nimrod Goren, president of Mitvim, the Israeli Institute for Regional Foreign Policies, and a senior fellow at the Middle East Institute in Washington. “There will be attempts to put all sorts of safeguards around it,” he told The Circuit.
Regarding Netanyahu’s comeback, Al Zeyoudi said the UAE has grown used to Israel’s frequent government transitions and doesn’t expect political changes to interrupt growth in trade between the two countries. Some Israeli investors have expressed concern that cabinet members in Netanyahu’s proposed government who want to annex the West Bank will reignite conflict with the Palestinians.
”Believe me, this will not affect the economy because everyone wants the numbers to grow,” Al Zeyoudi said. Netanyahu “was part of the initiation of the Abraham Accords and I’m sure he will make sure of its success.”
In the interview, Al Zeyoudi touched on how the collapse of FTX has affected the UAE’s efforts to promote itself as a world center for cryptocurrency trading and research.
“Obviously there’s concern when a high-profile business appears to have violated its customers’ trust in this way,” he said. “It offers a clear signal about the need for regulations, consumer protections, proper law and international conventions in the sphere.”
Given his experience as environment minister and a previous post as the UAE’s representative to the International Renewable Energy Agency (IRENA), which is based in Abu Dhabi, Al Zeyoudi said he’s looking forward to next year, when his country plays host to the U.N.’s annual climate change conference, COP28.
Beyond his desire to showcase cooperation between government and private industry in converting to sustainable energy sources, Al Zeyoudi said the UAE will also highlight the deal it brokered in which Jordan will provide solar energy to Israel in exchange for water from an Israeli desalination plant on the Mediterranean. The three sides signed a memorandum of understanding last month at the COP27 conference in Sharm el-Sheikh, Egypt.
“We’re looking forward to bringing the world here,” he said. “Sustainability is embedded with us as a nation. We have diversified our economy and diversified our energy mix. This is the story that we want to bring to the table, to discuss the real impact and the practical actions that we have taken on the ground.”
