ABN Amro to close Dubai office amid thin business for Dutch lender
The bank plans to transfer some of its international commodities business clients to Amsterdam
The Dutch bank ABN Amro is winding down its operations in Dubai and will transfer some of its existing clients in international commodities business to Amsterdam.
“The activities in Dubai will be wound down or transferred to other locations because of the limited scale,” according to a brief statement in the bank’s first quarter report published on Monday.
A spokesman for the bank told The National that the lender was planning to close down their Dubai office over the course of this year, pending regulatory approval. The amount of business for the bank in Dubai did not justify the overheads of having a branch in the emirate, he added.
While the bank has not generated enough volume of business in Dubai unlike some of the other international lenders, it has done well elsewhere. The bank's first-quarter net income of €595 million (Dh2.6bn) beat estimates for profit of about €575m in a Bloomberg survey of six analysts.
This is not the bank’s first retrenchment in the region. In 2017, ABN Amro sold its private banking operations in Asia and the Middle East to LGT, a Liechtenstein private bank and asset manager for an undisclosed sum.
The operation that was sold managed $20 billion in assets for clients, representing about 10 per cent of the bank's global assets under management, at that time. ABN Amro cited intense competition in these markets as a reason for exit as it shifted focus on private banking in north-west Europe.
In 2015, ABN Amro was fined $640,000 for perceived deficiencies in its anti-money laundering systems in the UAE, receiving penalties from both Dubai and Dutch regulators.
The Dubai Financial Services Authority imposed the fine on the Dutch bank’s branch in the DIFC after its private banking division contravened rules “requiring it to implement appropriate safeguards to prevent opportunities for money laundering”.
The regulator launched the investigation in 2015 in conjunction with the Dutch central bank De Nederlandsche Bank, following the resignation of six Dubai-based ABN Amro private banking employees for failing to comply with the bank’s internal guidelines.
Updated: May 14, 2018 03:57 PM