Mitsubishi UFJ eyes projects funding in Saudi Arabia

Mitsubishi UFJ Financial Group expects double-digit growth in its projects finance activities in the Middle East this year supported by Saudi’s efforts to reduce oil dependency, Reuters reported citing the group’s co-head, Elyas Algaseer.

Saudi National Transformation Plan, which focuses on diversifying the kingdom’s sources of revenue and privatizing some state-owned companies, represents a great opportunity for international banks.

MUFJ is currently cooperating with clients in the Middle East including Saudi Aramco, Acwa Power IPO-ACWA.SE and Mubadala Development, Algaseer said.

The group anticipates project finance opportunities worth $350 billion by year 2022 in Saudi Arabia and across the region in different fields such as power, alternative energy, health and education, Algaseer added.

"In this part of the world, they do have good liquidity reserves and good underground energy reserves and a good need to shift from relying on oil, so if these come through we should be on a lot of these deals because of our credentials and because of our know how," he said.

Algaseer added that Aramco’s listing in Tokyo is possible attributing this to the huge transaction which makes it hard for only two centers to manage it.

"If they do go to Japan they will definitely consider to have MUFJ to launch it and if they go somewhere else there's a good possibility to let MUFG and its partner Morgan Stanley to launch it,” he said.

Morgan Stanley and Mitsubishi UFJ have several partnerships, stemming from a $9 billion investment MUFG provided the Wall Street bank at the height of the financial crisis. The group currently owns 23.2 percent of Morgan Stanley, making it the bank's largest shareholder.

The Bank of Tokyo-Mitsubishi UFJ, expects to open its first branch in Saudi Arabia in 2018 after becoming the first Japanese bank to receive a license in the kingdom late last year, Algaseer added.