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SMBC to set up unit in Saudi Arabia

Saudi Arabia, November 27, 2017

Sumitomo Mitsui Banking will establish a subsidiary in Riyadh by the end of the year, in an effort to help Saudi Arabia's government-affiliated companies smoothly solicit bids. The financial institution will also provide advisory services to Japanese companies that are considering whether to tap into the country.

The Saudi government has teamed up with Japan's SoftBank to form a $93 billion investment fund called the Vision Fund to fund projects that will lead the oil-rich kingdom out of its dependence on oil. SMBC sees business opportunities related to these investments.

The new company, tentatively called SMBC Advisory Services Saudi Arabia, with capital of $1 million, will become SMBC's first unit in the Middle East since 2014, when the bank opened an office in Abu Dhabi, the United Arab Emirates.

Saudi Arabia is focusing more on foreign companies' capital as well as their renewable energy and desalination technologies. It is expected that international bidding contests will increase in these areas.

SMBC will help Japanese companies tap into the country by providing information. The bank is betting that project finance opportunities will increase in oil, gas and other areas.

Bank of Tokyo-Mitsubishi UFJ next year will become Japan's first bank to open a branch in Saudi Arabia. Mizuho Bank has already set up a brokerage unit in the country.