07/12/2017 11:03 AST

Citigroup Inc. has hired a new head of investment banking for Saudi Arabia as the U.S. bank prepares to launch operations in the kingdom next year.

Mr. Majed Al Hassoun, who will be based in Riyadh, initially will build up the operation to focus on working with public-sector entities in Saudi Arabia and large domestic and multinational companies. Citigroup expects to add up to 20 employees, including investment bankers, institutional debt and equity traders and stock-research analysts over time.

Mr. Al Hassoun will report to Carmen Haddad, who was appointed chief executive of Citigroup's business in Saudi Arabia earlier this year. Mr. Hassoun was previously a director at Saudi Fransi Capital, the investment banking arm of Riyadh-based Banque Saudi Fransi.

Citigroup's expansion plans in Saudi Arabia follow a 13-year absence from the country. The return highlights the opportunities that the bank and its rivals expect as a result of Saudi Arabia's plans to diversify its economy away from oil, using funds of up to $100 billion that it expects to raise from the planned initial public offering next year of the country's state-owned oil company Saudi Arabian Oil Co., or Saudi Aramco.

Some international banks are already benefiting from Saudi Arabia's efforts to raise funding internationally. In September, the Wall Street Journal reported that Saudi Arabia's ministry of finance hired U.S. banks JP Morgan Chase & C0. and Goldman Sachs, Bahrain-based Gulf International Bank, U.K.-based HSBC and Japan's Mitsubishi UFJ Financial Group Inc. to lead the country's recent international bond sale.

Still the bank's plan isn't without risk as highlighted by the government's recent anticorruption crackdown and continued uncertainty over Aramco's IPO.

Last month, the Saudi government detained more than 200 people including government officials, prominent businessmen and members of the country's ruling family. However, the recent release of several of the suspects shows that the crackdown is reaching a resolution.

Saudi Arabia has said its IPO plan for Aramco remains on track, however, the kingdom hasn't finalized on which exchanges to list shares of the energy giant.

Citigroup secured in April a banking license to operate in Saudi Arabia. It will allow the bank to advise companies on dealmaking, to underwrite and sell debt and equity securities, and to provide stock research for its corporate and institutional clients.


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