Considering the Middle East’s aspirations to rival London and New York with its financial centres, this isn’t something to shout about, but the region is becoming an increasingly attractive (and low cost) destination for international banks to transfer back office functions to.

One bank to make such a move last year was BNP Paribas. Jean Christophe Durand, managing director for the bank’s GCC operations told Emirates Business 24/7 that relocating business from Europe was key to its expansion plans in the region.

“For example, in 2009 we relocated businesses from Europe; one of them is cash management, so we now have cash management capability for large customers, which is based in Bahrain. We also relocated custody teams. So we continuously, when justified, relocate teams in the region,” he said.

The DIFC has made no secret of its desire to attract back office functions to the region, saying it offers an “attractive value proposition to both large and small banks that would increase their operational effectiveness and efficiency while reducing their costs.”

Jonathan Gould, financial services consultant at iQ Selection in Dubai, says: “It makes sense for banks to run these functions from the Middle East. They have access to substantial pool of highly-skilled, and comparatively cheap, talent from the Indian sub-Continent, and the time difference from Europe isn’t too great.”

Other international banks are offering back office services to financial services firms in the region. Deutsche Bank, which established its securities servicing arm in Dubai in 2008, has just kick-started a global transaction services operation in Abu Dhabi.

Citi, HSBC and Royal Bank of Scotland also offer global transaction services in the region, which include cash management and treasury functions.