BlackRock and HSBC launch Saudi investment funds
BlackRock and HSBC Global Asset Management have each launched exchange-traded funds that will track the MSCI Saudi Arabia Index, which focuses on mid and large-cap companies in the Gulf state, the FT reports.
The HSBC unit, which manages $451bn, said the launch was "in response to interest from international investors following the inclusion of Saudi Arabian equities into global indices".
BlackRock's new product, a Ucits version of an ETF available for US investors, was launched in response to significant client demand and in anticipation of the MSCI index inclusion.
MSCI will include the country in its influential emerging markets index this summer and Saudi Arabia's stock market was also recently admitted into emerging market indices run by FTSE Russell and S&P Dow Jones.
The decision by BlackRock and HSBC has prompted criticism that both managers have prioritised profits over human rights with their swift return to business as usual with the kingdom. Saudi Arabia drew condemnation following the killing of Khashoggi in the Saudi consulate in Istanbul.
It’s a privilege to be back in Saudi Arabia"
Saudi Arabia is once again attracting financiers as the Khashoggi outrage fades. Larry Fink and John Flint, chief executives of BlackRock and HSBC respectively, attended a financial conference held in Riyadh last month alongside other senior figures including Frédéric Oudéa, chief executive of Société Générale, and David Schwimmer, chief executive of the London Stock Exchange.
"It's a privilege to be back in Saudi Arabia," said Flint, one of several high-profile bankers who took to the stage with Saudi ministers at a Riyadh conference where the kingdom was showing off its financial pulling power. "We are committed, this is an economy we have a lot of confidence in."
BlackRock is also said to be considering to open an office in Riyadh.
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