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From Strength to Strength  30.10.2008

EMEA Finance
From Strength to Strength

Ansher Holding has expanded from its roots as the first western-style investment bank in Uzbekistan, to become a multinational player, with offices in Singapore, UK, Switzerland, UAE and elsewhere, and a diversified pool of product offerings. The chairman of the board of directors of Ansher Holding, Anvar Rasulev, tells us about the company’s plans.

Tell us some of the history of Ansher Holding

Ansher was established 10 years ago as the first western-style investment bank in Uzbekistan. It later expanded the types of services it provided, introducing new companies both in the region and worldwide. Today Ansher Holding Limited, domiciled in Singapore, comprises eight operating companies in the financial centres of the UK, Switzerland, Kazakhstan, Cayman Islands, and Uzbekistan and has representative offices in UAE, South Korea and Uzbekistan. In the course of its 10-year operations it has won seven Euromoney Awards for Excellence in various nominations and other numerous awards from the regional market regulators.

What are the main businesses in which it’s active?

Ansher started off as an investment bank and Ansher Capital is the investment banking arm of the Holding. Ansher Fund Management (Cayman Islands), is the asset management company and it launched two new funds in April 2008 with the focus on Central Asian and the Caucasus markets. Ansher Securities (Uzbekistan) is the equity brokerage company which has its office in Tashkent Stock Exchange’s building. Ansher Trust (Uzbekistan) offers custodian and depositary services. Ansher Investments (UK) offers account management services to international investors with exposure to above-mentioned markets. Ansher Finance (UK) is the investment arm of the Holding and offers private banking services. Ansher Real Estate (Uzbekistan) offers real estate brokerage and consultancy services. Ansher Group (Zurich) represents the Holding’s interests and promotes services offered by the Holding’s subsidiaries.

How important is the asset management and private banking business to Ansher?

We launched our asset management business only two years ago. However, within this relatively short period of time, we have already managed to achieve unprecedented performance of up to 85% growth in NAV within the first 15 months. Our funds are well-positioned to take advantage of the local presence and experience of the investment team in locating the most undervalued assets in the region. This contributes to the positive performance of the funds despite present volatility in global capital markets. Private banking is a relatively new and yet rapidly growing business line of Ansher. The number of clients is steadily increasing and the majority of them are from the CIS and Middle East. Therefore, in 2007, the Holding decided that, in addition to its UK operations, the Holding would enter the Swiss market. The annual return that private banking clients enjoyed by the 2007 year-end results ranged from 20-80%, which attracts more and more investors seeking Ansher’s private banking services.

Why did you decide to set up the headquarters in Singapore?

Choosing to set up headquarters in Singapore was not a random decision. We based our decision on at least three reasons. First, a number of our shareholders have been effectively working with Singapore for a few years and actively investing in various projects in that country. They advised us to open our headquarters in Singapore. Second, Singapore has very good business conditions for international investors (tax, administrative, etc). The Singapore Stock Exchange, where we plan to have our IPO in the next two to three years, also has favourable conditions for international holding companies that plan to be listed on the exchange. Third, Singapore is one of the major financial centres of the world, where financial services are very sophisticated. We actively attract investments from Singapore into Central Asia and the Caucasus. We have developed very strong ties with the banking and financial communities of Singapore and we look forward to continuing to build mutual co-operation in the future.

Which business line is growing the quickest?

Our investment focus and main operations are in Central Asia and the Caucasus, the world’s fastest growing region. Effective combination of our international experience with local expertise allows us to achieve sound results in all directions of our operations. Having said that,as mentioned, our fund management business is among the best performers and we are proud of our results to date.

What opportunities are there for investors in Central Asia outside of Kazakhstan?

The Central Asian region possesses great potential. The region is very rich in minerals and energy resources and has a great intellectual potential. Today, Central Asia is a rapidly-growing economic egion with an average GDP growth of 9%. Besides the growth in core industries of the region, such as mining and oil and gas, the region has great growth opportunities in retail business, consumer oods, agriculture, real estate and others. Uzbekistan has the largest consumer market with a population of more than 27mn. The financial sector is developing fast, yet consumer and mortgage lending levels are at very low levels (about 5-8% of GDP). For example, the mobile users’ penetration rate about two years ago was below 5%. Today it is 40%. Chemical and construction sectors have also grown at double digit rates over the last three to four years.

How is the credit crunch affecting Central Asian markets?

Central Asian capital markets, except for Kazakhastan, have very little correlation with global financial markets. This is mainly due to less integration of the financial system of these states with the global inancial market. The Kazakh market was affected the most severely by the crisis mainly because of the large amounts of foreign borrowings by the commercial banks. Kazakh banks were able to repay US$10.5bn to foreign creditors by the first half of 2008 and they have US$6.5bn due by the end of this year. They struggled to attract new sources of foreign borrowings to secure their lending activities. The real estate market went down and property assets lost about half of their value. However, the Kazakh government is playing an active role in rescuing the market and is being quite successful. The economy, although with lower pace of about 5% GDP growth, continues to grow. In the next couple of years Kazakhstan’s market will most probably totally recover. The other economies of the region were less affected by the crisis. Uzbekistan’s economy, for example, continues to grow about 9.3% quarterly in 2008. The economy of Uzbekistan is quite diversified and is less dependent on prices for energy resources and commodities. Chemical, retail, insurance, leasing, banking, consumer, real estate and a number of other industries are growing rapidly and their share in total GDP composition is expanding. Uzbek banks do not have large foreign borrowings, especially from the US capital markets. Therefore, the global financial crisis did not hit the country’s economy badly.

Could you tell us about your expansion plans for East Asia, Middle East and Europe?

The expansion of the Holding into other geographic markets (Singapore, South Korea, UAE, UK, and Switzerland) is called forth by the fact that we can attract substantial financial resources into the Central Asian and the Caucasus regions. There are lots of investors and fund managers, seeking portfolio diversification, in these markets. Therefore we have established our offices in those countries and are capitalising on our presence to actively promote our products, such as hedge funds and account management. The interest towards our products is continually increasing, especially amid the urrent financial crisis. At the same time we have partners from Singapore and Switzerland, who help us in rendering quality private banking services for our clients from Central Asia and the Caucasus. Last, but not least, we render our services to our private clients from Central Asia, the Caucasus and Europe on investing their savings into rapidly growing and high-return businesses in Dubai and Singapore.

What’s your outlook for the CIS markets in 2009?

Capital markets in CIS countries are very diverse and at different stages of development. Most of them have plenty of room to grow further. We believe that once the global markets hit their bottom within this turmoil, CIS markets are anticipated to show significant growth of not only market capitalisations, but also growth in liquidity and market efficiency. We already see signs of improved market conditions in several CIS counties and we do believe in further developments of the markets. And finally, what plans do you have for Ansher in 2009? With the financial crisis hitting the bottom, things will rapidly change worldwide. Ansher will capitalise from its presence in various markets and play an important role in the growth of those markets. Ansher will continue developing its new business in private banking and securing top positions in the region in this segment. We will continue penetrating markets and expanding into new regions. Currently, Ansher is holding talks on establishing its offices in one of the states in the Caucasus and in China. Moreover, as I said before, Ansher Holding Limited has planned to go public and offer its IPO on the Singapore stock exchange in coming years. It has started its activities towards preparing for the upcoming IPO and in 2009 it will continue with arrangements. 

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