Abu Dhabi’s ADIA Boosts Hedge Fund Exposure Via Managed Accounts - Bloomberg
The $1 trillion Abu Dhabi Investment Authority has ramped up its use of separately-managed accounts to deploy large chunks of money across dozens of hedge funds, according to people familiar with the matter.
Abu Dhabi’s biggest wealth fund has boosted its hedge fund exposure through the increasingly-popular mechanism to about $40 billion this year, one of the people said, asking not to be identified because the details are private.
That’s billions of dollars more than last year, and comes as ADIA looks to raise its exposure to alternative investments, the people said. It continues to deploy capital to hedge funds that’s co-mingled with other investors, according to the people.
A representative for ADIA declined to comment.
Separately-managed accounts, or SMAs, allow large investors ownership and control over their allocation to hedge funds and have emerged as a popular way to quickly deploy cash. They can offer discounted fees as well as efficient use of capital, as investors can apply leverage.
SMAs have grown in popularity in recent years as both traditional investors and multistrategy hedge funds like Millennium Management and Qube Research & Technologies use them as a gateway to fork out cash to external traders.
They’re now offered by roughly six in every 10 hedge funds, of which 8% launched their first SMA last year, according to a report by Goldman Sachs Group Inc.
ADIA’s move follows its decision earlier this year to buy a minority stake in Canada’s Innocap Investment Management Inc. that facilitates investment through SMAs. The fund has historically been among the biggest backers of hedge funds and allocated capital to Bobby Jain’s $5.3 billion startup.
It was set up in 1976 to invest Abu Dhabi’s surplus energy revenues, diversify its economy and prepare the United Arab Emirates’ capital for life after oil. ADIA is one of several Abu Dhabi sovereign entities that together control almost $1.7 trillion in assets.
Friday, 24 October 2025
#AbuDhabi Banks Lay Groundwork for Potential Risk Transfer Deals - Bloomberg
Abu Dhabi Banks Lay Groundwork for Potential Risk Transfer Deals - Bloomberg
Two of Abu Dhabi’s biggest commercial banks are weighing a foray into the market for significant risk transfers as lenders across the United Arab Emirates face higher capital requirements.
First Abu Dhabi Bank PJSC and Abu Dhabi Commercial Bank PJSC have been in talks with advisors that specialize in such transactions, according to people familiar with the matter. Preparations are at early stages and any potential deals are subject to regulatory approvals, said the people, who didn’t want to be identified because the matter is private.
A representative for First Abu Dhabi Bank declined to comment, and Abu Dhabi Commercial Bank didn’t reply to a request for a comment.
SRTs — frequently referred to as synthetic risk transfers — are a way for banks to insure loans against defaults. The transactions, which are often structured as credit-linked notes, allow lenders to boost their solvency ratios and reduce their reliance on less shareholder-friendly options like issuing new equity or cutting dividends. They also increase their leeway for new lending, acquisitions or shareholder payouts.
First Abu Dhabi Bank’s common equity tier 1 ratio, a key metric of financial strength, is currently at 13.7%. While it is above its self-imposed target of over 13.5%, the metric declined from 14.3% a year earlier and follows its increase of lending activities. Meanwhile, Abu Dhabi Commercial Bank, whose largest shareholder is Mubadala Investment Company, is issuing new stock, which will bolster the bank’s CET1 ratio by about 120 basis points.
UAE banks will face a slight increase in the total capital requirement by 50 basis points to accommodate for the countercyclical buffer from next year, according to Bloomberg Intelligence analyst Edmond Christou. Major banks already operate at higher capital levels than the new threshold.
If the two banks go ahead with SRT deals, it would help cement these transactions as additional options for Middle Eastern lenders to manage regulatory capital, alongside tools including issuance of common equity and Additional Tier 1 securities. A potential SRT transaction out of a lender in the UAE would require approval from the central bank, which is in charge of banking regulation, said the people.
A representative for the Central Bank of the UAE referred questions to the two banks.
Loans tied to SRTs reached €700 billion ($812 billion) at the end of last year, according to a survey from International Association of Credit Portfolio Managers in July. Around 97% of them were generated by European and North American banks.
Lenders issuing SRTs typically require their regulators’ approval to record a capital relief. Authorities including the European Central Bank have been generally supportive of such deals as they move credit risk out of the sector. However, they have also been cautious about the risk coming back into the system, for example if banks loan money to SRT investors.
The global SRT market is set to expand 11% annually on average in the next two years, according to a recent Bloomberg Intelligence survey. JPMorgan Chase & Co., Banco Santander SA, HSBC Holdings Plc and Deutsche Pfandbriefbank AG are among lenders that are currently discussing or finalizing such deals.
Oil slips on skepticism about US commitment to Russian oil sanctions | Reuters
Oil slips on skepticism about US commitment to Russian oil sanctions | Reuters
Oil prices fell on Friday as skepticism crept into the market about the Trump administration's commitment to sanctions on Russia's two biggest oil companies over the war in Ukraine.
Brent crude futures settled 5 cents, or 0.1%, lower at $65.94 a barrel, while U.S. crude futures <CLc1> finished at $61.50 a barrel, down 29 cents, or 0.5%.
Both benchmarks had risen earlier in the session, extending gains of more than 5% made on Thursday after the sanctions were announced, but retreated in the last two hours of trading. They still ended the week over 7% higher, the biggest weekly rise since mid-June.
"There is renewed skepticism these sanctions will be as harsh as they are said to be," said John Kilduff, partner with Again Capital LLC.
U.S. President Donald Trump hit Russia's Rosneft (ROSN.MM), opens new tab and Lukoil (LKOH.MM), opens new tab with sanctions to pressure Russian President Vladimir Putin to end the Ukraine war.
The two companies together account for more than 5% of global oil output, and Russia was the world's second-biggest crude oil producer in 2024 after the U.S.
The sanctions prompted Chinese state oil majors to suspend Russian oil purchases in the short term, trade sources told Reuters. Refiners in India, the largest buyer of seaborne Russian oil, were set to sharply cut Russian crude imports, industry sources said.
"Flows to India are at risk in particular," Janiv Shah, a vice president of oil markets analysis at Rystad Energy, said in a client note. "Challenges to Chinese refiners would be more muted, considering the diversification of crude sources and stock availability."
Kuwait's oil minister said the Organization of the Petroleum Exporting Countries would be ready to offset any shortage in the market by raising production.
The U.S. said it was prepared to take further action, while Putin derided the sanctions as an unfriendly act, saying they would not significantly affect the Russian economy and talking up Russia's importance to the global market.
Britain imposed sanctions on Rosneft and Lukoil last week and the European Union approved a 19th package of sanctions against Russia that includes a ban on imports of Russian liquefied natural gas.
The EU also added two Chinese refiners with a combined capacity of 600,000 barrels per day, as well as Chinaoil Hong Kong, a trading arm of PetroChina (601857.SS), opens new tab, to its Russian sanctions list, its official journal showed on Thursday.
Looking ahead, investors were also focusing on a meeting between Trump and Chinese President Xi Jinping next week as the pair work to defuse long-standing trade tensions and end a spate of tit-for-tat retaliatory measures.
Oil prices fell on Friday as skepticism crept into the market about the Trump administration's commitment to sanctions on Russia's two biggest oil companies over the war in Ukraine.
Brent crude futures settled 5 cents, or 0.1%, lower at $65.94 a barrel, while U.S. crude futures <CLc1> finished at $61.50 a barrel, down 29 cents, or 0.5%.
Both benchmarks had risen earlier in the session, extending gains of more than 5% made on Thursday after the sanctions were announced, but retreated in the last two hours of trading. They still ended the week over 7% higher, the biggest weekly rise since mid-June.
"There is renewed skepticism these sanctions will be as harsh as they are said to be," said John Kilduff, partner with Again Capital LLC.
U.S. President Donald Trump hit Russia's Rosneft (ROSN.MM), opens new tab and Lukoil (LKOH.MM), opens new tab with sanctions to pressure Russian President Vladimir Putin to end the Ukraine war.
The two companies together account for more than 5% of global oil output, and Russia was the world's second-biggest crude oil producer in 2024 after the U.S.
The sanctions prompted Chinese state oil majors to suspend Russian oil purchases in the short term, trade sources told Reuters. Refiners in India, the largest buyer of seaborne Russian oil, were set to sharply cut Russian crude imports, industry sources said.
"Flows to India are at risk in particular," Janiv Shah, a vice president of oil markets analysis at Rystad Energy, said in a client note. "Challenges to Chinese refiners would be more muted, considering the diversification of crude sources and stock availability."
Kuwait's oil minister said the Organization of the Petroleum Exporting Countries would be ready to offset any shortage in the market by raising production.
The U.S. said it was prepared to take further action, while Putin derided the sanctions as an unfriendly act, saying they would not significantly affect the Russian economy and talking up Russia's importance to the global market.
Britain imposed sanctions on Rosneft and Lukoil last week and the European Union approved a 19th package of sanctions against Russia that includes a ban on imports of Russian liquefied natural gas.
The EU also added two Chinese refiners with a combined capacity of 600,000 barrels per day, as well as Chinaoil Hong Kong, a trading arm of PetroChina (601857.SS), opens new tab, to its Russian sanctions list, its official journal showed on Thursday.
Looking ahead, investors were also focusing on a meeting between Trump and Chinese President Xi Jinping next week as the pair work to defuse long-standing trade tensions and end a spate of tit-for-tat retaliatory measures.
Crunch time for #SaudiArabia as financial elite descend on Riyadh | Reuters
Crunch time for Saudi Arabia as financial elite descend on Riyadh | Reuters
Global financial titans descend on Riyadh next week for Saudi Arabia's flagship investment conference, for the first time since the return to the White House of Donald Trump, whose taste for extravagant projects chimes with the kingdom's big plans.
The Future Investment Initiative (FII) conference is taking place against a backdrop of a fragile U.S.-brokered Gaza ceasefire, simmering regional tensions and a kingdom that is facing growing pressure to demonstrate its massive economic transformation isn't just hype.
The world's largest oil exporter has in the past used the gathering to showcase its ambitious plans and ink deals to attract foreign investment while hosting world leaders and financiers under an opulent conference centre's golden domes.
Expected attendees this year include Colombian President Gustavo Petro, BlackRock's Larry Fink, JPMorgan's Jamie Dimon and Citi's Jane Fraser, who on Tuesday became the co-chair of the U.S.-Saudi Business Council. It also features tech and energy heavyweights such as Intel's Lip-Bu Tan and Aramco's Amin Nasser.
TEST TO SEE IF INVESTORS WILL AFFIRM CONFIDENCE
The event, whose Miami edition was attended by Trump himself in February, will be another litmus test to see whether global investors will affirm confidence in the Saudi economy.
Riyadh committed to investing $600 billion in the U.S. when Trump visited the kingdom in May. But Saudi Arabia is also striving for inward capital to bankroll Crown Prince Mohammed bin Salman's economic plan to outgrow hydrocarbon dependence.
Many projects have been delayed amidst low oil prices and a budget deficit that has forced the kingdom to prioritise and downsize.
"Trump's larger-than-life style and the kingdom's love of big, attention-grabbing announcements make a good match," said Alice Gower, partner at London-based advisory Azure Strategy.
But the follow-through on headline pledges is likely to be slow at a time when Riyadh is under pressure to deliver huge projects in time to host global events.
"Investors are still contending with the realities of a state-dominated economy, opaque decision-making, skills shortages, and heavy spending commitments," Gower said.
DEADLINES FOR BIG EVENTS
The international gathering of the elite shows that the days when Saudi Arabia was shunned by some Western governments - only a few years ago - are now well in the past.
After taking power in a palace coup in 2017, MbS faced international censure for cracking down on dissent and for the killing of journalist Jamal Khashoggi. Saudi Arabia says Khashoggi was killed by a rogue group, though MbS has said he accepts responsibility because it happened on his watch.
Many investors are now happy to visit and open to deploying funds, but some are still wary of Riyadh's ability to meet its big project deadlines. Among its promises: to host the 2027 Asian Cup, World Expo 2030, and, in 2034 both the Asian Games and the soccer World Cup, for which it must complete 15 stadiums — 11 of them brand new.
Some projects tied to those events are already delayed, most notably Trojena, a ski resort in the futuristic city of NEOM, a desert mega-city that was intended to house nearly nine million people by the Red Sea that has faced repeated delays.
Trojena is scheduled to host the 2029 Asian Winter Games, with Saudi officials reportedly considering postponing until 2033. Work on NEOM's "The Line" - billed as an indoor city 170 km long and just 200 metres wide - has been scaled back to focus on completing a 2.4 km stretch to include the World Cup stadium.
"There are quite a lot of challenges that would be associated with trying to compress everything into a very short time frame, rather than sort of prioritising and pencilling investments in over a longer period," said Edward Bell, chief economist at Dubai's Emirates NBD.
Lower oil prices and heavy investment commitments are weighing on the kingdom's finances, Fitch Ratings said this month.
The Saudi government's 2026 pre-budget statement signalled a shift towards tighter spending after a sharper-than-expected widening of the 2025 deficit, now seen at 5.3% of gross domestic product.
Bell said Saudi Arabia is likely to run deficits for several years, although he credited the government with being transparent and realistic about its needs.
Asked for comment on prioritisation of projects, a Saudi Finance Ministry spokesperson said: "As we have previously stated, all priority projects remain on track and the economy continues to diversify powered by strong non-oil growth through the private sector, with a strong and disciplined fiscal position."
The world's biggest banks have been deepening their commitment to Saudi Arabia, with the likes of Citi and Goldman Sachs setting up regional headquarters and expanding their teams.
The kingdom, whose economic transformation is being spearheaded by the almost $1 trillion Public Investment Fund, is still a target of $100 billion in annual foreign direct investment by 2030.
"It's a very difficult target," said Karen Young, a senior fellow at the Washington-based Middle East Institute, noting that the largest FDI deals continue to be in the energy sector.
While the kingdom is behind on some projects, it has been able to deliver others, most notably those led by luxury resort developer Red Sea Global (RSG).
Speaking to Reuters this week in Abu Dhabi, RSG CEO John Pagano, who sits on the board of NEOM, said changes would be introduced to help secure delivery timelines of mega projects.
"The country and the PIF are making sure we don't fail to meet those commitments," he added.
Global financial titans descend on Riyadh next week for Saudi Arabia's flagship investment conference, for the first time since the return to the White House of Donald Trump, whose taste for extravagant projects chimes with the kingdom's big plans.
The Future Investment Initiative (FII) conference is taking place against a backdrop of a fragile U.S.-brokered Gaza ceasefire, simmering regional tensions and a kingdom that is facing growing pressure to demonstrate its massive economic transformation isn't just hype.
The world's largest oil exporter has in the past used the gathering to showcase its ambitious plans and ink deals to attract foreign investment while hosting world leaders and financiers under an opulent conference centre's golden domes.
Expected attendees this year include Colombian President Gustavo Petro, BlackRock's Larry Fink, JPMorgan's Jamie Dimon and Citi's Jane Fraser, who on Tuesday became the co-chair of the U.S.-Saudi Business Council. It also features tech and energy heavyweights such as Intel's Lip-Bu Tan and Aramco's Amin Nasser.
TEST TO SEE IF INVESTORS WILL AFFIRM CONFIDENCE
The event, whose Miami edition was attended by Trump himself in February, will be another litmus test to see whether global investors will affirm confidence in the Saudi economy.
Riyadh committed to investing $600 billion in the U.S. when Trump visited the kingdom in May. But Saudi Arabia is also striving for inward capital to bankroll Crown Prince Mohammed bin Salman's economic plan to outgrow hydrocarbon dependence.
Many projects have been delayed amidst low oil prices and a budget deficit that has forced the kingdom to prioritise and downsize.
"Trump's larger-than-life style and the kingdom's love of big, attention-grabbing announcements make a good match," said Alice Gower, partner at London-based advisory Azure Strategy.
But the follow-through on headline pledges is likely to be slow at a time when Riyadh is under pressure to deliver huge projects in time to host global events.
"Investors are still contending with the realities of a state-dominated economy, opaque decision-making, skills shortages, and heavy spending commitments," Gower said.
DEADLINES FOR BIG EVENTS
The international gathering of the elite shows that the days when Saudi Arabia was shunned by some Western governments - only a few years ago - are now well in the past.
After taking power in a palace coup in 2017, MbS faced international censure for cracking down on dissent and for the killing of journalist Jamal Khashoggi. Saudi Arabia says Khashoggi was killed by a rogue group, though MbS has said he accepts responsibility because it happened on his watch.
Many investors are now happy to visit and open to deploying funds, but some are still wary of Riyadh's ability to meet its big project deadlines. Among its promises: to host the 2027 Asian Cup, World Expo 2030, and, in 2034 both the Asian Games and the soccer World Cup, for which it must complete 15 stadiums — 11 of them brand new.
Some projects tied to those events are already delayed, most notably Trojena, a ski resort in the futuristic city of NEOM, a desert mega-city that was intended to house nearly nine million people by the Red Sea that has faced repeated delays.
Trojena is scheduled to host the 2029 Asian Winter Games, with Saudi officials reportedly considering postponing until 2033. Work on NEOM's "The Line" - billed as an indoor city 170 km long and just 200 metres wide - has been scaled back to focus on completing a 2.4 km stretch to include the World Cup stadium.
"There are quite a lot of challenges that would be associated with trying to compress everything into a very short time frame, rather than sort of prioritising and pencilling investments in over a longer period," said Edward Bell, chief economist at Dubai's Emirates NBD.
Lower oil prices and heavy investment commitments are weighing on the kingdom's finances, Fitch Ratings said this month.
The Saudi government's 2026 pre-budget statement signalled a shift towards tighter spending after a sharper-than-expected widening of the 2025 deficit, now seen at 5.3% of gross domestic product.
Bell said Saudi Arabia is likely to run deficits for several years, although he credited the government with being transparent and realistic about its needs.
Asked for comment on prioritisation of projects, a Saudi Finance Ministry spokesperson said: "As we have previously stated, all priority projects remain on track and the economy continues to diversify powered by strong non-oil growth through the private sector, with a strong and disciplined fiscal position."
The world's biggest banks have been deepening their commitment to Saudi Arabia, with the likes of Citi and Goldman Sachs setting up regional headquarters and expanding their teams.
The kingdom, whose economic transformation is being spearheaded by the almost $1 trillion Public Investment Fund, is still a target of $100 billion in annual foreign direct investment by 2030.
"It's a very difficult target," said Karen Young, a senior fellow at the Washington-based Middle East Institute, noting that the largest FDI deals continue to be in the energy sector.
While the kingdom is behind on some projects, it has been able to deliver others, most notably those led by luxury resort developer Red Sea Global (RSG).
Speaking to Reuters this week in Abu Dhabi, RSG CEO John Pagano, who sits on the board of NEOM, said changes would be introduced to help secure delivery timelines of mega projects.
"The country and the PIF are making sure we don't fail to meet those commitments," he added.
#UAE markets gain on rate cut optimism | Reuters
UAE markets gain on rate cut optimism | Reuters
Stock markets in the United Arab Emirates closed higher on Friday with Dubai outperforming its regional peers as tame U.S. inflation data and expectations of future Federal Reserve rate cuts ignited market optimism.
U.S. inflation data, which had been delayed due to the government shutdown, showed consumer prices increased slightly less than expected in September.
The Fed is expected to cut rates by 25 basis points at its meeting next week.
Policy shifts in the U.S. often sway Gulf markets where most currencies including the UAE's, are pegged to the dollar.
Dubai's main index (.DFMGI), opens new tab advanced 0.8%, nearing a two-month high, boosted by gains in heavyweight real estate stocks.
Blue-chip developer Emaar Properties (EMAR.DU), opens new tab jumped 2.8% and its construction arm Emaar Development (EMAARDEV.DU), opens new tab surged 4.6% after Emaar unveiled Dubai mansions at Emaar Hills, a 100 billion dirham ($27 billion) community of 40,000 ultra-luxury homes.
Among the gainers, Ajman Bank (AJBNK.DU), opens new tab rose 2.9% following a 82% growth in its third-quarter net profit to 134.9 million dirhams.
Abu Dhabi's benchmark index (.FTFADGI), opens new tab edged up 0.1%, supported by a 2.3% rise in Adnoc Logistics & Services (ADNOCLS.AD), opens new tab and a 1.9% increase in energy infrastructure firm NMDC Energy (NMDCENR.AD), opens new tab.
Abu Dhabi Ports Company (ADPORTS.AD), opens new tab surged 5.6% to an 8-month high, as its supply-chain management arm Noatum Logistics signed a preliminary agreement with Hafeet Rail to establish a new rail service between Sohar in Oman and Abu Dhabi in the UAE.
Dubai's index notched up 1.2% on a weekly basis, while Abu Dhabi recorded 0.8% weekly gains, according to data compiled by LSEG.
Meanwhile, oil prices, a key catalyst for Gulf's financial markets - extended gains on Friday as U.S. sanctions on Russia's two biggest oil companies over the war in Ukraine fuelled supply concerns.
Brent crude was up 0.76% at $66.49 a barrel by 1150 GMT.
Stock markets in the United Arab Emirates closed higher on Friday with Dubai outperforming its regional peers as tame U.S. inflation data and expectations of future Federal Reserve rate cuts ignited market optimism.
U.S. inflation data, which had been delayed due to the government shutdown, showed consumer prices increased slightly less than expected in September.
The Fed is expected to cut rates by 25 basis points at its meeting next week.
Policy shifts in the U.S. often sway Gulf markets where most currencies including the UAE's, are pegged to the dollar.
Dubai's main index (.DFMGI), opens new tab advanced 0.8%, nearing a two-month high, boosted by gains in heavyweight real estate stocks.
Blue-chip developer Emaar Properties (EMAR.DU), opens new tab jumped 2.8% and its construction arm Emaar Development (EMAARDEV.DU), opens new tab surged 4.6% after Emaar unveiled Dubai mansions at Emaar Hills, a 100 billion dirham ($27 billion) community of 40,000 ultra-luxury homes.
Among the gainers, Ajman Bank (AJBNK.DU), opens new tab rose 2.9% following a 82% growth in its third-quarter net profit to 134.9 million dirhams.
Abu Dhabi's benchmark index (.FTFADGI), opens new tab edged up 0.1%, supported by a 2.3% rise in Adnoc Logistics & Services (ADNOCLS.AD), opens new tab and a 1.9% increase in energy infrastructure firm NMDC Energy (NMDCENR.AD), opens new tab.
Abu Dhabi Ports Company (ADPORTS.AD), opens new tab surged 5.6% to an 8-month high, as its supply-chain management arm Noatum Logistics signed a preliminary agreement with Hafeet Rail to establish a new rail service between Sohar in Oman and Abu Dhabi in the UAE.
Dubai's index notched up 1.2% on a weekly basis, while Abu Dhabi recorded 0.8% weekly gains, according to data compiled by LSEG.
Meanwhile, oil prices, a key catalyst for Gulf's financial markets - extended gains on Friday as U.S. sanctions on Russia's two biggest oil companies over the war in Ukraine fuelled supply concerns.
Brent crude was up 0.76% at $66.49 a barrel by 1150 GMT.
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