State Street Corp. and First Abu Dhabi Bank will share custody duties for institutional investors in the Middle East and North Africa, the two firms said in a joint news release Monday.
The banks announced a strategic alliance that includes First Abu Dhabi Bank's existing direct custody network, which the partners said is the largest for institutional investors in the Middle East and North Africa.
The new full-service custodial offering "strategically brings together the best of FAB's regional securities services expertise with State Street's global custody and front-to-back office and data management," said Oliver Berger, senior vice president and State Street's head of Middle East and North Africa, in an email.
First Abu Dhabi Bank will become State Street's sub-custodian in Bahrain, Oman, Saudi Arabia, Kuwait and United Arab Emirates, and State Street will become First Abu Dhabi Bank's global custodian, Mr. Berger said.
"With a fully integrated platform (with each company's offerings) entirely complementary ... this alliance will be able to cover a more diverse set of clients and prospects," he said.
The new custody network allows asset owners to invest in more than 100 countries including in major listed and unlisted asset classes. Client-service teams are based in Bahrain, Egypt, Kuwait, Oman, Saudi Arabia and United Arab Emirates, according to the release.
"The Middle East landscape is distinctive with some of the world's largest sovereign wealth funds alongside a diverse range of private investment institutions," said Hana Al Rostamani, group chief group CEO of FAB, said in the release.
"This partnership between FAB and State Street represents a unique proposal for MENA investors and those who invest in the regions," said Ronald P. O'Hanley, State Street's chairman and CEO, in the statement.
"Clients are looking for financially secure and operationally resilient partners who can manage the non-core elements of their business, helping to deliver operational efficiencies, reduce cost, mitigate risks and navigate complex regulation," Mr. O'Hanley added.
FAB had total assets of United Emirates' dirham 941 billion ($256 billion) as of March 31.
As of the same date, State Street had $40.3 trillion in assets under custody and/or administration and $3.6 trillion of assets under management.