Abu Dhabi’s US$50 billion fund sets up fintech firm with US bank

(Bloomberg) – Lunate, the Abu Dhabi-based alternate investment fund with more than $50 billion of assets, is partnering with Bank of New York Mellon Corp on a new fintech venture to tap into the region’s burgeoning market for wealth management.

Alpheya, which will start with US$300 million in capital, will provide a range of digital services, including client onboarding, financial planning, portfolio construction, trading and rebalancing, risk-management reporting and analytics, said a statement on Tuesday (Nov 21). 

The firm will start serving clients in the fourth quarter of 2024, and is on track to hire at least 100 staff locally and globally, said Akash Shah, chief growth officer at BNY Mellon. The US bank has a minority stake in the new firm.

“This product is demand-driven,” he said in an interview. “We saw that our clients, mostly banks in the region, wanted to serve their wealth market, but didn’t have the right technology and capabilities to do it, and they were trying to build or buy it very quickly.” 

Roger Rouhana, the head of strategy at BNY Mellon in New York for almost five years, is the chief executive officer of Alpheya. Under his leadership, the firm is looking to capture the Gulf region’s US$5 trillion wealth market that’s growing at 8 per cent to 10 per cent a year, a pace rarely seen in financial services globally, Shah said. 

Lunate and BNY Mellon are also looking to bring other shareholders into the business and are actively engaged with other potential regional investors, he said. BLOOMBERG