HSBC Saudi Arabia has secured a mandate to act as local custodian to Ashmore Group, which is one of the first asset managers to secure regulatory approval to invest in Saudi Arabia’s stock market, the Tadawul.
HSBC Saudi Arabia also acted as the local Assessing Authorised Person, facilitating Ashmore’s Qualified Foreign Investor (QFI) licence application.
In June 2015, the Saudi Arabia Capital Markets Authority (CMA) opened the Saudi market to qualified institutional investors. As one of the world’s largest stock markets to remain closed to foreign investment, this marked one of the most keenly awaited economic reforms.
HSBC Saudi Arabia is the largest international custodian in Saudi Arabia. Its local team of experts facilitated Ashmore’s QFI licence application process for the fund manager entity and thereafter for its Middle East SICAV fund. The resulting regulatory approval was due to the collaboration between Ashmore, its global custodian, Northern Trust, and HSBC Saudi Arabia.
Mark Coombs, Chief Executive Officer, Ashmore Group, says: “As an Emerging Markets asset manager, Saudi Arabia represents a very exciting opportunity for us. Not only is it the largest economy in the Middle East, but it has a clear-sighted strategy to diversify its economy away from oil.
HSBC’s local team provided expertise and support in helping us gain our QFI licence through its extensive local market knowledge and experience.”
Arindam Das (pictured), Head of Securities Services, Middle East and North Africa, HSBC, adds: “Ashmore’s success in being one of the first fund managers to achieve QFI status to invest in Saudi demonstrates its commitment to emerging markets and we are delighted to be its local partner in Saudi Arabia. The market opening will not only enhance diversity and liquidity, but it will also improve market efficiency, transparency and corporate governance. We will continue to partner with foreign institutional investors in search of new investment opportunities in Saudi’s capital market.”
Majed Najm, Chief Executive Officer of HSBC Saudi Arabia, says: “Custody services are an important element of our offering for institutional clients and for our overall QFI effort. We continue to make investments in this business to facilitate direct access for our institutional client base into the Saudi market, with the objective of continuing to lead in market development.”
