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HSBC’s Quinn Courts Qataris for Deals After Chasing Saudi Fees

Archana Narayanan, Matthew Martin and Harry Wilson
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HSBC’s Quinn Courts Qataris for Deals After Chasing Saudi Fees

(Bloomberg) -- HSBC Holdings Plc is intensifying efforts to mend ties with Qatar after diverting its attention from the gas-rich Gulf state that’s been isolated by a regional standoff to chase a fee windfall in Saudi Arabia.

Acting Chief Executive Officer Noel Quinn traveled to the country this month to meet officials at the sovereign wealth fund, finance ministry and central bank, according to people with knowledge of the matter, who asked not to be identified because the matter is private.

The bank is trying to improve relations with key executives such as Finance Minister Ali Shareef Al Emadi, who sits on the boards of the country’s biggest bank, national airline and Qatar Investment Authority, one of the people said. Representatives for HSBC and the QIA declined to comment. Qatar’s media office declined to comment on behalf of the ministry of finance and central bank.

HSBC is among global banks seeking to improve relations with Qatar two and a half years after Saudi Arabia, the United Arab Emirates, Bahrain and Egypt cut ties with Doha. They accuse Qatar of financing terrorism and cozying up to Iran -- allegations it denies. The stakes of doing business with the country are high as the QIA pushes into technology investments and expands its global portfolio of trophy assets -- most recently with the acquisition of the St. Regis New York.

Balancing Act

International banks operating in the Gulf have been playing a delicate balancing act since the standoff started: chasing deals in the U.A.E. and Saudi Arabia -- where the world’s biggest initial public offering is underway -- and quietly doing Qatari business from London or New York instead of Dubai. The two countries were informally warning bankers that close ties with Doha could have consequences, while central banks demanded that lenders reveal their exposure to Qatari clients, Bloomberg News has reported.

Still, there are signs that regional political relations are thawing. Qatar has taken some steps toward resolving its tensions with its neighbors but must still do more, a senior Saudi official said in Washington earlier this month.

After a drought of public transactions in Qatar, HSBC is starting to get back into public dealmaking in the country. In April, the bank was part of QIA’s Project Maple II BV unit’s 625 million-pound ($801 million) refinancing of 8 Canada Square in London’s Canary Wharf area. It worked on 15 bond sales in the country in the two years before the standoff started, according to data compiled by Bloomberg.

Saudi Deals

In Saudi Arabia, HSBC is one of the most active international investment banks through its local unit HSBC Saudi Arabia Ltd., in which the London-based lender owns a 49% stake. Quinn was among finance elites that attended Saudi Arabia’s marquee investment summit at the end of October.

Samir Assaf, CEO of global banking and markets, was among the few top banking executives to show up at the 2018 event that was overshadowed by the murder of government critic Jamal Khashoggi. HSBC’s commitment to the kingdom was rewarded when the bank was appointed on Saudi Aramco’s mammoth share sale.

--With assistance from Zainab Fattah.

To contact the reporters on this story: Archana Narayanan in Dubai at anarayanan16@bloomberg.net;Matthew Martin in Dubai at mmartin128@bloomberg.net;Harry Wilson in London at hwilson57@bloomberg.net

To contact the editors responsible for this story: Stefania Bianchi at sbianchi10@bloomberg.net, Marion Dakers

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