Investment banks in the Gulf Cooperation Council (GCC) say they are continuing their regional operations despite the escalating conflict involving Iran, Israel, and the United States, which has now entered its second week. The banks had expanded their presence over the past two years amid a surge in debt and equity capital markets activity.
On Tuesday, Iran’s Islamic Revolutionary Guard Corps (IRGC) warned it could target economic hubs and banks linked to U.S. and Israeli interests in the region, raising concerns about the safety of financial institutions’ local operations.
Since the conflict began, many bankers have shifted to working remotely, although firms say business activities are continuing. Remote working arrangements are expected to remain in place until the regional outlook becomes clearer.
Citi, which runs its regional operations from Dubai, said most of its UAE-based staff are now working remotely. The bank added that it has transitioned to a fully remote model for employees in the country while continuing to serve clients without disruption.
The bank also confirmed it had evacuated three of its UAE buildings after receiving specific information, noting that the move was taken to prioritise staff safety. All employees were reported safe and accounted for.
HSBC, which has topped LSEG league tables in the region for the past three years, said it is closely following government guidance while managing working arrangements through its internal contingency plans.
In a statement addressing developments affecting GCC countries, CEO Georges Elhedery said the region has repeatedly demonstrated resilience during periods of disruption and has the ability to adapt and recover strongly. He added that HSBC remains committed to the region, where it has operated for more than 130 years.
Standard Chartered, meanwhile, rejected reports that it had evacuated staff from its Dubai offices. The bank said the UAE and other Middle Eastern markets remain key parts of its global network and that it continues to support clients amid a challenging environment. It added that a precautionary work-from-home policy introduced last week has been extended.
Deutsche Bank said its operations and business activities in the Middle East remain ongoing and have not been directly affected by the conflict. The bank noted that its local branches and offices continue to operate in line with guidance from authorities, while staff in affected areas are working remotely and travel to the region has been temporarily suspended.
Impact on markets
The year began with strong momentum in GCC debt capital markets, led by Saudi Arabia, with more than $30 billion raised in January alone. At the time, the strong issuance was seen as a sign that the region was brushing off geopolitical concerns.
However, Fitch Ratings said GCC debt issuance has dropped significantly since the conflict with Iran escalated, with several deals delayed amid rising uncertainty and market volatility. The ratings agency noted that this could affect broader emerging-market debt issuance trends, as GCC issuers account for nearly 40% of all emerging-market dollar issuance in 2026 so far, excluding China.
According to Bashar Al Natoor, managing director and global head of Islamic finance at Fitch Ratings, future debt capital market activity in the GCC will largely depend on how the conflict evolves.
He said bond and sukuk yields have widened since the war began, particularly for non-investment-grade issuers. However, sukuk in the Middle East and North Africa region have continued to trade more tightly than conventional bonds, reflecting sustained demand.
Al Natoor noted that similar yield movements have occurred during previous periods of geopolitical or Shariah-related uncertainty, though current levels remain below peaks seen during earlier conflicts. He added that markets typically reopen once stability returns, and that regional issuers have shown resilience in managing heightened geopolitical risks in recent years.
The region had been preparing for a busy year for initial public offerings in 2026 after raising $5.1 billion through 40 listings last year. Kamco Invest estimates that 73 IPOs are currently in the pipeline across the GCC, with Saudi Arabia and the UAE expected to lead equity capital market activity.
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