HSBC to set up brokerage in UAE equity markets

The company, to be called HSBC Middle East Securities, will offer UAE domestic market brokerage services to both institutional and retail investors. The company is expected to begin trading for institutions by the end of 2007, and to offer retail brokerage services in 2008.

Emirates Securities and Commodities Authority (ESCA), the regulator for the UAE's securities markets, recently granted HSBC authorisation to establish the brokerage company.

The authorisation is subject to the various legal and infrastructural requirements meeting the approval of ESCA, as well ADSM and DFM. With this approval, HSBC is poised to become the first global bank on the UAE's exchanges.

HSBC already buys and sells UAE shares on behalf of Western institutions through third party brokers. In addition, HSBC is a sub-custodian on both ADSM and DFM, and this service will continue to be provided by the bank's specialist sub-custody operation.

'The Middle East is high on the radar of institutional investors around the world,' said Neil Foster, Head of HSBC Global Markets for the Middle East.

'This development is hugely significant, since it gives our institutional clients direct access via HSBC to the very positive investment story of the region, as well as giving investors in the UAE and the region a significant new channel to invest in these markets.'

Irfan Muzzammil, Director of Investment Services, Middle East at HSBC, will be the Chief Executive Officer of the company, and Neil Foster, Regional Head of Global Markets, will be Chairman.

'International institutional investors are already significant players in the UAE's markets, HSBC's new status as a licenced broker in the UAE will enable international investors direct access to these dynamic markets. This development will be highly positive in raising the profile of the region, and is a further move by these markets towards their next stage of development and maturity.'

added Foster.

Paul Cooper, Head of Equities for Central Europe, Middle East and Africa, added:

'The establishment of HMES is a pivotal step in providing our local and international clients with a full range of leading brokerage services including execution, sales, and capital market presence. HSBC is committed to building out its Gulf equity capabilities as part of its significant wider Pan Arabian footprint encompassing the UAE, Saudi Arabia and Egypt.'

'We have worked very hard in preparing the groundwork for this development, and are delighted to receive ESCA authorisation,' added Irfan Muzzammil.

'HSBC will bring quality brokerage services to institutional and retail clients. Our strategy to become a broker-member of ADSM & DFM is in line with the bank's commitment to the continuing development of the region's capital markets. We are grateful to the UAE Authorities, ESCA, ADSM, and DFM for their support of our application.'