BlackRock set to receive USD 5 bn in backing from PIF to solidify footing in Saudi + Behind HSBC’s Noel Quinn’s “shock exit”

US asset management giant BlackRock is getting its hands on up to USD 5 bn from the Saudi Public Investment Fund (PIF) as part of a push to grow in the Kingdom, Bloomberg reported, citing a statement. The US investment giant is setting up a new entity — BlackRock Riyadh Investment Management — which will be run by PIF and BlackRock.

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A team in Riyadh to bring it together: A Riyadh-based investments team will manage the multi-asset platform, which will integrate strategies across asset classes. It will also be looking to secure additional funding from local and foreign investors.

What they said: “The continued growth of the kingdom’s capital markets and diversification of its financial sector will contribute to future prosperity for its citizens,” BlackRock CEO Larry Fink said. “Saudi Arabia has become an increasingly attractive destination for international investment.”

REMEMBER- BlackRock has been making moves this week: BlackRock hosted a “private” gathering earlier this week in Riyadh to highlight potential investments in the Kingdom for key corporate executives and regional investors. Key speakers at the event included PIF Governor Yasir Al Rumayyan and Energy Minister Prince Abdulaziz bin Salman.

Background: The world’s largest asset manager is said to be on an “aggressive hunt for growth in Saudi Arabia,” with Fink coming to town multiple times per year. The firm’s 20-person Saudi team — the biggest among its peers and challengers — is “embedding itself in different parts of the country’s institutions and capital markets,” Bloomberg wrote.

ALSO- HSBC CEO Noel Quinn resigned after nearly five years in his position as he looks to retire, with the bank now searching for a replacement, considering candidates internally and externally. During Quinn’s tenure, the bank focused on boosting Asian investments while cutting back in Western markets.

The Financial Times has the best insider take we’ve seen yet on the “shock exit.” “Inside HSBC headquarters, the narrative is that it was impossible for both Quinn and group chair Mark Tucker to continue in their roles.” Each effectively had a “three-year deadline” to leave the organization at around the same time — and Tucker wanted to oversee the selection of the third CEO his board will work with.

MARKETS THIS MORNING-

Most Asian markets are closed this morning in observance of Labor Day. The Nikkei was down about 0.7% in early trading, while Australia’s ASX 200 was off a bit more than 1%. Markets are also closed today in France, Germany, Italy, and Spain and will look to make up ground tomorrow after the broad Stoxx 600 closed down nearly 1.5% for the month of April.

Futures suggest shares in London and New York will face selling pressure at the opening bell later today.

THE CLOSING BELL-

The ADX rose 0.1% yesterday on turnover of AED 1.2 bn. The index is down 5.3% YTD.

In the green: Ras Al Khaimah National Ins. (+14.8%), Emirates Ins. (+11.1%) and Emirates Stallions Group (+4.8%).

In the red: Palms Sports (-10.0%), Fujairah Cement Industries (-3.2%) and RAK Co. for Cement and Construction Materials (-3.0%).

Over on the DFM, the index closed down 0.1%, on turnover of AED 507.5 mn. Meanwhile Nasdaq Dubai rose 0.2%.

CORPORATE ACTIONS-

Adnoc Logistics & Services will pay out AED 477 mn in dividends — its first since its IPO last year — for 2023 on 30 May, the company said in a press release (pdf). This will be the base dividend amount on which it will base its progressive dividend policy, which will see it increase dividends by a minimum of 5% each year, according to the statement.

Al Ramz will pay out AED 33 mn in dividends for 2023, according to a regulatory filing (pdf).

Fertiglobe will distribute USD 200 mn in dividends for 2H 2023, bringing total dividends for the year to USD 475 mn, according to a press release (pdf). The dividends mark one of the industry’s highest dividend yields, the company said.