Panic selling from Middle East’s ultra-wealthy ruled out by Credit Suisse

The Swiss bank Credit Suisse does not expect any panic selling among high net worth individuals (HNWIs) in the Middle East region, where low oil prices and slower growth are affecting people’s fortunes.

“It is different now from how it used to be many years ago,” said Bruno Daher, the head of private banking in the Middle East and India at Credit Suisse. “Clients are more sophisticated, more mature, more knowledgeable and understand better and are capable of seeing opportunity in the market. Acti­vity always drops a little bit, it is cyclical.”

According to Credit Suisse, a high net worth individual has a wealth of 30 million Swiss francs (Dh114.6m) and above, while an ultra high net worth individual has assets of more than 50m francs.

Most global markets, including those in the region, have rallied after a disappointing start to the year. Even commodities such as gold and oil have risen.

Household wealth in the Middle East and North Africa dropped 2.2 per cent between mid-2014 and mid-2015 to US$4.4 trillion as total global household wealth fell 4.7 per cent to $250.1tn, Credit Suisse said in a report last October.

But the number of millionaires in the region is expected to grow by more than half in the next five years, the report added. Unlike the financial crisis of 2007-08, Middle Eastern ­HNWIs are more mature in their investment choices.

Qatar recorded the highest average wealth per adult at $157,000 in mid-2015, growing 0.8 per cent from the same per­iod in 2014, Credit Suisse said in the report. The UAE followed close behind with $144,400 per person, declining 0.3 per cent from 2014. The biggest drop, however, came from Kuwait, where wealth per adult fell 7.6 per cent from 2014 to $113,400.

Credit Suisse, which competes in private banking with rivals including UBS and HSBC, is under scrutiny after it was named in leaked documents from the Panama-based law firm Mossack Fonseca.

The Swiss bank was one of several international institutions mentioned in the leaked documents, which allegedly revealed offshore accounts of well-known figures.

Credit Suisse Group’s chief executive Tidjane Thiam has denied any wrongdoing, saying that “it is committed to tax- compliant business”, and “its clients use structures only for legitimate purposes”.

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