BY BUKOLA IDOWU, Lagos
United Bank for Africa recently broke record as the first Pan African Bank to directly open a branch from Nigeria at the Dubai International Financial Center (DIFC) in the United Arab Emirates (UAE). The new branch of the 73 year old bank will operate under the Category 4 license and will be regulated by the Dubai Financial Services Authority (DFSA), the financial regulatory agency of the special economic zone.
The newly minted branch is expected to drive the UBA Group’s goal of harnessing opportunities in the Middle East, Africa and South Asia (MEASA), which comprise of 72 countries with an approximate population of three billion and a nominal GDP of $7.7 trillion.
This is expected to reinforce it strong franchise as Africa’s Global Bank, facilitating trade and capital flows between Africa and the rest of the world, as the DIFC branch will service corporate & financial Institutions and customers across the Middle East with a core focus on correspondent banking, relationship management and advisory services.
As the DIFC is a wholesale jurisdiction where any retail customer dealing is expressly prohibited, therefore the clients will be corporate and financial institutions. Thus the UBA DIFC will be offering letters of credit beneficiary to clients.
It will also manage and serve the groups corporate and financial institution clients with the aim of deepening our share of their businesses, whilst engaging new corporate/financial institution clients and refer them to other UBA Group subsidiaries and branches for on-boarding lending etc.
Whist promoting correspondent banking relationships in the Middle East, the new branch will broaden client base corporate and FI clients beyond Dubai and UAE to the entire Middle East and originate transactions and negotiate deals that will be booked in other UBA Group subsidiaries and branches.
Group chairman of the bank, Tony Elumelu whilst speaking on the motivation for imprinting UBA Group’s financial stride in Dubai stated that the relationship between the Gulf and Africa had been strong as business transactions severally cross borders between Africa and the Gulf region.
“There are a lot of Africans who do business in the Gulf region and there are a lot of people in the Gulf region that want to do business with Africa, but need to find the right partners and the right financial institution to work with.
“So, UBA setting up in Dubai at this point in time would help to provide that payment and trade finance correspondent banking platform for our people and Africans who do business in the Gulf region and people in the Gulf region who do business with Africa. It‘s been a long journey; we‘ve always hoped and wished for this to happen and we are happy that today, that audacious ambition or dream has become a reality and we are happy that UBA is berthing in the Gulf and Dubai precisely.”
Elumelu, explained that with the Group’s foray into the Gulf Region, UBA continues to focus on its strategic intent to lead the way when it comes to doing business in Africa. “Collaborating with our franchises in 20 African countries and the major financial centres of London, New York and Paris, UBA (DIFC Branch) will facilitate the financing of trade transactions between the Middle East and Africa, enabling trade finance and investments.
“We have been looking forward to this day as it is the first time we will have presence in this part of the world. We know that our international expansion is incomplete if we are not present in the gulf” he continued.
To the group managing director and chief executive of UBA, Kennedy Uzoka, the establishment of the branch in the DIFC is historic for the bank. “As you know, we have been in operation for about 73 years; we have a very strong franchise in our continent because our business is primarily Africa-based.
“However, we have to deal with the entire world and that means that we need to have strong financial support across the world. We are in the United States as the only bank out of Sub-saharan Africa that operates in that country; we are in the United Kingdom and we have a representative office in France. We believed that the equation wasn’t balanced, that was why we decided to come to Dubai Financial Centre.
“The whole idea is to make sure that our customers are served, regardless of where they are operating. So, whether you are a customer in Kinshasa, Dakar and you are dealing with any client across the globe that has interest in this part of the world, UBA is able to provide you with the service you require.
“So, today we are now formally in four continents across the globe, operating in 24 countries across the world and serving over 33 million customers and still growing. Today also shows that UBA is also a strong franchise and we are expanding our reach across the world.
“We are the only bank with Nigerian origin that has extended out of Nigeria to the UAE. Those before us have come through other locations and that shows the strength and respect the Dubai authorities have for UBA. Our presence in Dubai affirms that UBA is a strong franchise, expanding its reach across the world.
“The authorities and business environment here in the DIFC is phenomenal and UBA is seeing Dubai as the gateway for Africa and that is why we are here, to be closer to our clients, to be partnering with them and facilitate businesses and trade flows into Africa through the UBA franchise. So, we are super excited.
On his part, the CEO, UBA(DFIC), Mr. Vikrant Bhansali, said; “Trade, commerce and Investments in Africa is expanding in the Gulf Region and Asia. Leveraging the presence of UBA Group in global financial centres, UBA (DFIC) will enhance the ability of the group to facilitate access of Gulf investors and banks to African markets. We will finance trade, facilitate commerce and help grow investment in Africa, across all sectors.”
Chief executive officer, Dubai International Financial Centre(DIFC) Authority, Arif Amiri, said during the ribbon cutting ceremony “UBA(DFIC) attests to the strong relationship between Dubai and Africa. It is a beautiful start as we are looking forward to achieving more interaction, channelling more trade and investments into Africa, and with UBA DIFC, we are closer to achieving our objectives. DIFC will continue to seek partnerships that will deliver winning relationships as we have just witnessed with UBA Group.”
The move to Dubai is however just the beginging as Uzoka noted that the Group is “considering other locations that would complement what we are doing. This is just the beginning. On behalf of every one in UBA and our customers that made this happen because without them we would not achieve much, we say thank to them and thank you to the authorities of UAE for granting us this authorisation to operate.”