According to media reports, UBS extended a credit line worth billions of dollars to a member of the ruling family of the Emirate of Qatar, throwing a spotlight on the market region.

UBS is said to have offered a $9 billion credit line to Qatari Sheikh Hamad bin Jassim bin Jaber Al Thani, according to a  «Bloomberg» (behind paywall) citing anonymous sources.

UBS, which took over Credit Suisse in March, used the deal to pay off an existing credit facility Credit Suisse extended to the sheik, increasing it by at least 50 percent. Neither the bank nor Al Thani confirmed the transactions to the agency.

Once a Major Credit Suisse Shareholder

Hamad bin Jassim Al Thani isn't just anyone: The member of Qatar's ruling family once served as prime minister and foreign minister of the emirate. Until 2013, he was responsible for the Qatari sovereign wealth fund (QIA), which supported Credit Suisse with billions after the financial crisis and became a significant shareholder of the now-defunct bank.

If the report is accurate, it shows that the combined UBS also wants to stay in business with the Qataris and is even making an even more generous offer to an important member of the ruling family than CS was able to do before. However, the significant concession to an Al Thani also puts the region more into the spotlight.

 Middle East's Growing Importance

With high energy prices and increasing geopolitical influence, the region is promising for private banking. However, when integrating Credit Suisse's business, UBS recently had to review the books and install a new regional operational head.

On the other hand, the booming business in the Middle East is overshadowed by the flaring conflict in Israel, and UBS implemented travel restrictions for Qatar and postponed events.

Political Balancing Act

Bankers will likely avoid taking sides with the various political and religious factions. But this is a delicate balancing act, as finews.ch recently analyzed. Qatar, which maintains contacts with Hamas and officially acts as a mediator between Israel and the militant Palestinian organization, has attracted much attention and criticism.