In a significant move reflecting the growing importance of the Middle Eastern financial landscape, U.S.-listed direct lender and private credit manager Golub Capital has announced the opening of an office in Abu Dhabi, the capital of the United Arab Emirates. This decision aligns with a wider trend, where numerous financial institutions are eyeing opportunities in the region, driven by its potential for robust economic growth and lucrative partnerships with sovereign wealth funds. With over $70 billion in assets under management as of October 1, Golub Capital’s entry into this market underscores the increasing influence and appeal of Abu Dhabi as a financial hub.
Golub Capital has reportedly secured preliminary approval for a license to operate within the Abu Dhabi Global Market (ADGM), a financial center designed to facilitate international business. This strategic location provides a platform for Golub to enhance its operations and expand its services throughout the Middle East. The firm’s recent appointment of Naser Almutairi as the managing director for the region signals a commitment to deepen its presence and expertise in this dynamic market.
The backdrop for Golub’s expansion is a broader initiative by the UAE, especially Abu Dhabi, to diversify its economy away from oil dependency. Holding 90% of the UAE’s oil reserves, the emirate is strategically pivoting towards finance, technology, and alternative investments. With the ADGM actively working to establish itself as a global financial hub, the region is experiencing a notable influx of major financial players, although it continues to compete with Dubai’s Dubai International Financial Centre (DIFC).
As of June, ADGM was reported to manage approximately $157.2 billion in assets, a figure that has been bolstered by the arrival of high-profile firms such as Ray Dalio’s family office, Brevan Howard, and BlackRock, the world’s largest asset manager. This increasing concentration of capital management is indicative of a growing trust in the region’s regulatory environment and investment potential.
Alongside this growing infrastructure, the private credit market is witnessing a meteoric rise. As traditional banks face tighter regulatory requirements, the attractiveness of private credit has surged. In fact, projected growth estimates indicate that the private credit sector could balloon to $2.6 trillion by 2029, up from $1.5 trillion last year. This creates an ideal backdrop for firms like Golub Capital to establish a foothold and seize market opportunities.
Moreover, significant investments by Gulf sovereign wealth funds into private credit further amplify the attraction of this sector. Notably, Abu Dhabi’s $330 billion Mubadala Investment Company has entered strategic partnerships with major financial institutions such as Apollo and Goldman Sachs. Recently, Mubadala announced plans to acquire a 42% interest in Silver Rock Financial, underscoring its aggressive expansion strategy within the asset management space.
Golub Capital’s foray into the UAE market marks a pivotal moment in the evolution of financial services in the region. The interplay of economic diversification, the rise of private credit, and the increasing sophistication of local financial infrastructure positions Abu Dhabi as a formidable player in the global financial arena. As firms continue to explore potential synergies and expand their investments, the future of financial opportunities in the Middle East appears exceedingly promising.