Asia

Asia

Arab rich mull moving wealth on Egypt concerns

03 February 2011 00:35 (UTC +04:00)

Baku â€“ APA. Rich Middle Eastern families are asking their European private bankers how safe their money is as they consider moving their millions out of the troubled region, a Reuters poll shows, APA reports quoting â€œReutersâ€.
Half of the 10 private banks contacted in London and Switzerland -- collectively managing more than $4 trillion in assets around the world -- reported a pick-up in enquiries from clients in the region worried about unrest in Egypt.
The concerns have yet to translate into flows of assets out of the region, with none of the banks reporting significant movements of money. But this may change as Egypt’s political crisis spooks international markets, some said.
"It’s a region where there is intrinsic uncertainty, but obviously when there are events like this people talk to us," a source at a Swiss private bank told Reuters, speaking on condition of anonymity.
The poll was of 10 banks varying in size across the world who took part anonymously.
The turmoil in Egypt, where massive anti-government protests turned violent on Wednesday, comes after Tunisians ousted their autocratic government weeks ago, spooking the region’s financial markets.
The popular uprisings have prompted speculation the protests could spread across the region, unseating more governments and sparking further violence.
Super-rich Arabs from the Gulf states and elsewhere in the Middle East have long been a staple for private bankers in the elite playgrounds of London and Geneva, where many of the region’s dynasties spend part of the year.
These banks offer red-carpet services to the world’s rich -- from standard deposits to super yacht financing -- with Switzerland and the UK acting as hubs to the industry.
It is an industry dominated by large players such as UBS, Credit Suisse and Bank of America, though none of these players individually holds a large share of the market, where hundreds of smaller players operate.
Private banks in Europe -- particularly Switzerland -- have built their reputation on the region’s safe-haven status, attracting clients from countries with a less stable political and financial climate.
The unrest in the Middle East suits these secretive operators, and the bankers said they are ready to act if asked by clients.
"It is fair to say that in times of political or economic difficulty, there is likely to be a flight of capital to a safer environment," said one senior private banker based in London.