BMO, which manages $107 billion worth of assets globally, set up a representative office in Abu Dhabi, capital of the United Arab Emirates and home to most of its oil wealth.
“We manage over $100 billion in assets, $10 billion or more we will manage in the Gulf region in a relatively short period of time,” Bill Downe, the bank’s president and chief executive, told reporters, giving a time frame of about five years.
Currently, BMO manages assets worth around $600 million in the Middle East and Gulf Arab region. The latter has some of the world’s biggest sovereign wealth funds in Abu Dhabi, Qatar and Kuwait.
BMO already manages money for wealth funds in the region and its initial focus will be on institutional investors, private banking and high net worth individuals, Downe said.
Global wealth management is an attractive asset class for Canada’s banks, which have strong capital ratios compared with international competitors and whose profitable Canadian banking businesses face slower growth.
BMO is the latest Canadian bank to target wealthy investors in the Middle East. Last month, Royal Bank of Canada, the world’s sixth largest wealth manager, said it would double its wealth management team in Dubai in the near future.
The Middle East and Africa wealth management sector grew 8.6 percent in 2010 and overall assets under management may rise to $6.7 trillion by 2015 helped by high oil prices, a 2011 study by the Boston Consulting Group showed.
“Institutional investors are looking to diversify capital because of what’s happened in the region,” said William Smith, BMO’s managing director and head of Europe & Middle East, in an apparent reference to “Arab Spring” uprisings, as well as volatile markets.
