Goldman Sachs said to be in talks for equities license in KSA

Saudi is emerging as attractive opportunity for international banks as it takes steps to overhaul its economy
(REUTERS/Lucas Jackson)
By Bloomberg
Sun 26 Mar 2017 06:12 PM

Goldman Sachs Group Inc is in preliminary talks for an equities license in Saudi Arabia as the US lender seeks to take advantage of the country’s economic reforms, according to people familiar with the matter.

The bank has yet to file a formal application, the people said, asking not to be identified as the information is private. While talks are ongoing, no final decisions have been made, the people said. The bank may also decide against going ahead with the submission, they said.

A Goldman Sachs representative declined to comment. Saudi Arabia’s Capital Markets Authority, which would approve the license, did not immediately respond to requests for comment.

Goldman is following banks including HSBC Holdings Plc, Citigroup and Ashmore Group Plc, which already acquired equities licenses in the kingdom after the country opened to foreign investment in 2015. Saudi Arabia is emerging as an attractive opportunity for international banks as the kingdom takes steps to overhaul its economy, including plans for what could be the largest initial public offering with the listing of Saudi Arabian Oil Co.

Goldman Sachs set up a dedicated Saudi Arabian business in 2008 after securing a license from the Capital Markets Authority, according to information on its website. The bank is currently eligible to offer asset management services to institutions and companies as well as advise on corporate finance transactions in the country. The new license would allow them to buy and sell Saudi Arabian equities as well.

Saudi Arabia’s stock exchange is the Arab world’s largest with a total market capitalisation of about 1.61 trillion riyals ($429 billion). It’s home to Saudi Basic Industries Corp., one of the world’s largest chemicals manufacturers and Saudi Telecom Co., the Gulf kingdom’s biggest telecommunications operator.

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