Bank, Deutsche Bank and Midland Bank to form a joint European Advisory Committee (EAC) that aimed to hold regular meetings on issues of common interest and to create a common basis for facilitating special transactions. The EAC members were especially keen to strengthen their presence overseas in order to compete with the mainly US-based banking giants of the day. In 1970, they founded the European Banks International Company (EBIC), an organisation that sponsored the establishment of several regional banks, sharing costs and risks. The first, European American Bank (Eurambank), was set up in 1968, tasked with helping the EBIC shareholders expand their business in the United States. It was followed by European Arab Bank (Eurab) in the Near East (1972), European Asian Bank (Euras) in Southeast Asia (1972) and Banque Européenne pour l Amérique Latine (BEAL) in Latin America (1974).

Stakes in EBIC and its subsidiaries were progressively made available to other western European banks, such as Banca Commerciale Italiana.

Société Générale de Banque s participation in FRAB Bank International

The Middle East was an area of expansion par excellence for bank consortiums50. From the 1960s, the OPEC countries had been increasingly accumulating foreign currency surpluses, known as petrodollars. In order to capture a share of this windfall, many European banks formed consortiums in partnership with local financial institutions.

In 1970, Société Générale de Banque decided for the first time to join a bank consor- tium working in the Middle East: FRAB Bank International, or Banque Franco-Arabe d Investissements Internationaux. The consortium had been set up a year earlier by a number of Arab and Western financial institutions. Société Générale (France) owned 25 percent of the venture, a group of Kuwaiti banks 26.5 percent and Saudi banks 12 per- cent. Société Générale de Banque s share was limited to 6 percent.

FRAB Bank International was chaired by French national Jean-Pierre Terray, Honorary President of Banque de l Union Européenne. It had a network of representative offices in several Arab countries and was particularly interested in arranging medium-term syndicated loans, Eurobond issuances and joint ventures between European and Arab companies.

FRAB was of a relatively modest size, posting at the end of 1971 a total balance sheet of around 360 million French francs, deposits amounting to US$45 million, and profits of 1.3 million francs.

50. For more on the activity of European banks in the Gulf States, see Traute Wohlers-Scharf: Arab and Islamic Banks: New Business Partners for Developing Countries, especially pages 23 and 137.

217B N P PA R I B A S F O R T I S I N T H E M I D D L E E A S T S O M E H I S T O R I C A L B A C K G R O U N D