Royal Bank of Scotland joins growing number of banks cutting research staff in Middle East
Royal Bank of Scotland has ended a tie-up with Dubai's Rasmala Investment Bank to provide equity research on Middle Eastern companies, the part-nationalised UK lender said on Sunday.
Several global investment banks, including Credit Suisse and Japan's Nomura, are cutting research staff in the Middle East to save costs amid tough global conditions and a dearth of work in the region.
"There is no further requirement for the joint arrangement with Rasmala," Simon Penney, RBS' chief executive for Middle East and Africa, said in an email statement, adding the decision follows a move by the lender to exit its cash equities business globally.
"RBS is committed to its other businesses in the UAE," Penney said in the statement.
RBS, 83-percent owned by the UK government, is in talks to sell its mergers and acquisitions business in the Middle East and cut some jobs as part of a global restructuring, the bank said in January.
That comes as part of a global shake up in which RBS plans to cut another 4,450 jobs.
The bank was an advisor in the sale of Aujan Industries' 50-percent stake to Coca-Cola Co late last year.
International banks had flocked to the Middle East in recent years, lured by the oil-rich region's growth prospects and the lucrative fees available, from taking companies public to advising on sovereign fund deals.
But increased competition and the financial crisis has reduced prospects. Amid that backdrop, bankers say more staff from the region may be shifted to other locations or laid off.
Rasmala, which has around $900 million in assets, has offices in the United Arab Emirates, Saudi Arabia, Oman and Egypt and operates in asset management, corporate finance and institutional brokerage.
European Islamic Investment Bank plans to acquire about 35 percent stake in the Dubai bank.