Not least in this growth are the oil-rich, high-liquidity Gulf countries. Some estimates expect an increase in high net worth individuals (those with assets of US$1 million or more available for investment) of 15.3 per cent per annum from 2007 to 2012. This is against a global average of 7.7 per cent per annum, and the highest of all emerging markets.*
"Much of the GCC's current liquidity can be attributed to demand for commodities, which is currently being driven in large part by resource-hungry Asian countries," comments Soha Nashaat, Managing Director of Barclays Wealth in the Middle East and North Africa (MENA).
The policy of many GCC governments to diversify their economies beyond hydrocarbons has driven further wealth creation within the region. EIU estimates put foreign direct investment at US$44 billion in 2006. It is expected that this will increase to US$100 billion by 2011.
Perhaps no surprise then that, according to Ms. Nashaat, private banking is the fastest growing segment of financial services, hence the need for Barclays Wealth's bespoke innovative and cutting edge financial solutions. Barclays Wealth is highly committed to the region as manifested in the impressive investment in human and capital resources. A specialist team was established in the region to implement strategy and to offer expert advice to clients, hence complementing the company's already extensive global operations.
"At Barclays, we believe that the relationship-based, advice-driven model is the future in the wealth business, as far as servicing customers, and irrespective of their level of assets," asserts Ms. Nashaat. "People always require personalized advice to help them manage their wealth. Our role is to take the time to truly understand our clients' financial situation and personal backgrounds - where the clients have come from and where they are going."
In this regard, Barclays Wealth has developed a proprietary approach to building client portfolios which encompasses a holistic end-to-end process of risk profiling, planning, and advisory services before making any recommendation. Considerations might include reducing a client's vulnerability to volatile markets, spreading investment risk through asset diversification techniques, or offering flexible investment strategies based on individual needs.
One fast growing area for Barclays Wealth is succession planning for family-owned business within the region. Ms. Nashaat explains the rationale behind this emerging trend. "While the region is in the process of developing capital markets, many businesses still tend to be family-focused," she offers. "The issue of succession planning becomes more complicated through generations. It is crucial therefore, that the family members work closely with their advisors at an early stage to identify their values and aspirations such that these become the cornerstone of a wellplanned strategy.
Expanding markets
The Middle East will continue to be a region of strategic importance and future growth for Barclays Wealth. Currently Barclays Wealth operates from offices in Dubai, Abu Dhabi, and Doha-Qatar. In addition to the above locations, clients in the region benefit from Barclays Wealth's presence in other international financial centres such as London, Geneva, Singapore and Monaco. The company's continuing investments only reinforce the global wealth boom we will see in the coming years and the sheer scale of the opportunities that Barclays Wealth will be presented with over the next decade and beyond.