It’s homecoming for Mashreq as the bank opens in Oman

It’s a homecoming of sorts for our friends at Mashreq, a leading MENA financial institution and our anchor partners here at EnterpriseAM UAE. The Dubai-headquartered lender started life in 1967 as the Bank of Oman and yesterday opened its first branch in Muscat.

The formal addition of Oman to Mashreq’s footprint gives the bank a direct presence in 14 markets and major global financial centers, ranging from the UAE and Egypt to Pakistan, London, Mumbai, Hong Kong, and New York.

With Oman increasingly on the radar for regional companies and investors alike, we spoke in Muscat with some of Mashreq’s top execs about why Oman, why now, and what the opportunity looks like going forward.

Mashreq’s strategy in Oman is to capitalize on deepening trade and investment ties between the UAE and Oman as the Dubai-headquartered lender builds on its decades-long involvement here. It’s good timing: Oman emerged from 2024 as one of the most intriguing places to do business in the Middle East, with IPO flows that dwarfed London, a commitment to economic growth and diversification, and an ambitious series of growth targets.

Why does Mashreq like Oman? Group Head of International Banking Tarek El Nahas singled out “logistics, tourism, manufacturing, and renewable energy,” among other sectors, pointing to Oman’s ambitious Vision 2040 program, which calls for the building of a globally competitive economy while prioritizing environmental sustainability.

Real estate is also on Mashreq’s radar, El Nahas added, saying, “We have already funded a number of real estate developments in the tourism industry and we’re exploring with the government how we can bring some of our UAE experience to the funding of smart cities.”

In that vein, Mashreq has appetite for large-scale development projects, said Chairman Abdul Aziz Al Ghurair. “We have the balance sheet we need to support large-scale projects of the type that will be very important to the Omani economy over the coming 5-10 years and beyond. Banks will need to be able to write large tickets, to make decisions quickly, and to make decisions locally. That’s what Mashreq does: We set our strategy and make our decisions here in our region, not in London, and then we layer-in the best technology and know-how that we’ve refined in the UAE and across our global footprint, whether we’re serving the largest corporations or individual clients.”

Mashreq is no stranger to the Sultanate, said Group CEO Ahmed Abdelaal. “We’ve been here for decades working with corporate clients, the government, and quasi-governmental agencies,” he noted, adding that its market entry is “in line with Oman’s Vision 2040 and emphasizes unlocking value for our clients through corporate banking, sustainable finance, and digital innovation.”

“The UAE is Oman’s largest trade partner, making it an obvious priority for us as we grow,” said Al Ghurair. “While we have been doing business here with the government and corporates for more than 25 years, it’s clear that we need to be on the ground now. His Majesty Sultan Haitham Bin Tariq Al Said’s strategy has made the market very attractive — the chance to have an impact on the nation’s economy and to play a role in opening up investment opportunities is massive. We’ve had tremendous support from the Central Bank of Oman for our digital-led approach,” Al Ghurair added, pointing out that Mashreq has closed 95% of its branch network in the UAE, saying it can better serve clients through digital channels.

“GCC banks are among the most forward-looking globally,” El Nahas said, pointing to regional banks’ agility, focus on customer experience, and adoption of new technologies. “Our clients are looking for an edge in a competitive, interconnected world, whether they’re aligning with global trade flows or exploring high-potential new markets. Our mission is to help clients capitalize on those opportunities. We see a future where businesses in Oman are building a competitive, knowledge-driven economy that is backed by the entrepreneurial spirit of a new generation. That’s the story we want to be a part of: Helping create growth for our clients and for the nation as a whole,” he added.

What’s in the pipeline right now for Mashreq? “We’ve long been partners with the sovereign and many of the government-related entities and larger corporate clients here in Oman, where we’ve been involved in multiple debt capital market transactions in the past two or three years for players such as Energy Development Oman,” El Nahas said. “We’re in active discussions with the government on sovereign issuances, and we’re seeing more and more of our clients — regional and international alike — enter Oman. There is a lot of foreign direct investment coming into the country, and it’s on the cusp of investment grade. We want to bring more regional and global businesses into the country, then serve their needs, whether that’s local-currency solutions or cash-management solutions. In parallel, we want to be a conduit to global markets for Omani companies.”

“Government institutions and large corporates are clearly attractive and we’re open to multiple sectors,” said Alsalt Al Kharusi (LinkedIn), an Omani citizen and veteran of HSBC and Oman Arab Bank who joined Mashreq a year ago to launch the franchise in Oman.

El Nahas was careful to note Mashreq’s credentials in the sustainable finance segment, pointing out that “we’ve made a commitment to assist in raising sustainable finance worth USD 30 bn by 2030. We’re well on the way — in fact, we’re slightly exceeding our targets. And it’s not just in the UAE; we’re leading on sustainable financing for our clients across the GCC, in India, in Africa. This is exactly in line with Oman’s strategy on digital transformation and sustainable finance.”

Mashreq isn’t entering as a competitor to Omani banks, but a partner, Abdelaal noted. “Our aim in entering any new market is to work in partnership with local institutions. Our strength is that we link up global markets through our network and our technology, whether those markets are the UAE and Mumbai — or London, New York, Hong Kong, and Shanghai. Our presence in Asia and Africa are specific strengths, as is our high digital metabolism.”

Mashreq aims to be profitable in Oman from day one, said Al Ghurair, a goal he says is rare and possible “because of our unique segment of clients here.”

BACKGROUND- The UAE and Oman are becoming ever closer trade partners. UAE and Omani companies inked agreements worth a combined USD 35 bn in April 2024, including the launch of a large-scale tech fund, an AED 117 bn energy megaproject, and the UAE-Oman railway, among others. UAE officials and their Omani counterparts have singled out industries including digital infrastructure, food security, energy, and transportation as priority sectors.