Emirates NBD eyes art loving elite

Abdul Basit
Filed on January 28, 2011

DUBAI — Emirates NBD, a leading bank in the Middle East, has planned a new product for its art lover private banking clients that will open an asset class market worth $3 trillion for the bank’s High Net Worth Individuals (HNWIs).

The bank on Wednesday announced its partnership with the Fine Art Fund Group (FAFG) to launch art advisory services. The international art market is worth more than $3 trillion and has an annual turnover of $50 billion.

The bank will offer this advisory services to its private banking clients across the UAE and also in other parts of the world where bank has its operations, Emirates NBD Acting General Manager and Chief Investment Officer, Private Banking Gary Dugan told Khaleej Times.This partnership will enable the bank to provide value-added advisory services to its clients, who wish to include art as a percentage of their investment portfolios, Dugan said, adding: “We look forward to working closely with the art professionals at FAFG, which is renowned for developing and managing investment vehicles that invest in fine art,” Dugan added.

According to the partnership agreement, experts from the FAFG will work closely with Emirates NBD Private Banking to provide advisory services to the bank’s HNWI clients who wish to invest in art as an asset class. Emirates NBD Private Banking clients will also gain privileged access to art events regionally and globally.

“Art as a tangible asset continues to attract international investor attention in the post-recession world and the market for art has remained strong in 2010,” Dugan said.

Middle East investors are also expressing greater interest in art, and recent estimates show that last year, approximately 25 per cent by value of the 100,000 plus works of art sold went to buyers from Russia, Asia and the Middle East, according to Dugan.

Philip Hoffman, Chief Executive Officer, The Fine Art Fund Group, said: “In addition to the opportunity for portfolio diversification, art has traditionally yielded high returns and shown a low correlation to other asset classes, thus proving to be a remarkable store of value. It is however, critical to evaluate and assess the art objects effectively in order to guarantee, high returns on investment. The in-house expertise at the FAFG is pleased to work with a leading bank like Emirates NBD to offer our services to their high net worth clients and investors.”

Hoffman said art is an interesting asset class and provide very good return of investment. Demand for top end art market is increasing and supply is not sufficient, he added. Arrival of a new art museum in Abu Dhabi in addition to art initiatives in Qatar and Kuwait and growing popularity of art from Egypt, Syria, Lebanon and even Iraq will increase low spending profile to high in the Middle East, Hoffman said.

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