Security concerns outweigh tax benefits in Dubai, Xu, a principal at Anderson Global, says.

DUBAI,— Iranian missile and drone strikes on Dubai last week have prompted some wealthy investors to reconsider keeping large amounts of money in the Gulf financial hub, advisers and lawyers told Reuters.

Shortly after the attacks, two Indian entrepreneurs living in Dubai attempted to transfer more than $100,000 each from their accounts at local banks to Singapore.

The businessmen said the move was intended to reduce financial exposure during a period of uncertainty.

Both individuals spoke to Reuters on condition of anonymity because the matter involves personal financial decisions. They said their transfer plans initially failed because of technical disruptions at banks after the strikes.

One of the entrepreneurs later completed the transfer by using another bank operating in the United Arab Emirates. The funds were sent to his account in Singapore, he said.

Financial advisers say similar concerns are emerging among other wealthy investors from Asia who have parked money in Dubai.

Several clients are making inquiries about moving assets to major financial centers such as Singapore and Hong Kong.

The discussions come as the U.S.-Israel war on Iran raises questions about the stability of the Gulf region, which has long been viewed as a secure location for global capital.

Affluent investors usually divide their wealth among different countries and financial products. Decisions about where to keep assets often depend on tax structures, regulatory systems, privacy rules and operational conditions.

Dubai has gained prominence in recent years as a destination for international wealth. Entrepreneurs and rich families from across Asia, particularly from China, have been drawn to the city by its policies and financial advantages.

The Gulf region has also experienced rapid expansion in real estate and infrastructure, encouraging foreign investment.

Figures from the United Arab Emirates central bank show that the country’s banking and financial sector holds assets totaling more than 5.42 trillion dirhams, equivalent to about $1.48 trillion.

The recent attacks on Dubai and Abu Dhabi have prompted some investors to reassess the UAE’s image as a secure financial center.

Ryan Lin, a private wealth lawyer based in Singapore, told Reuters that several clients with assets in Dubai contacted him in recent days. Out of around 20 clients he advises there, six or seven reached out to discuss moving funds.

Lin said those clients each hold assets averaging about $50 million.

Three of them are planning to transfer money to Singapore in the near future, he said.

“One client is checking how quickly they can transfer everything to Singapore,” Lin said.

Iris Xu, a principal at Anderson Global, said her firm has also received new inquiries. Xu said between 10 and 20 family offices have approached the company this week about shifting assets from the Middle East back to Singapore.

Family offices are firms created to handle investments and financial planning for wealthy families.

Xu said the motivations of some investors appear to be changing.

“Dubai was always about tax benefits but now I think the tax benefits may not be the top priority for them,” she said.

A Singapore based wealth adviser who declined to be named because they were not permitted to speak publicly said discussions with clients have increased.

The adviser said they had spoken with 13 clients based in the United Arab Emirates and more than half are seriously evaluating a transfer of funds to Singapore.

The adviser added that even if fighting ends soon, travel could remain complicated.

“Flying back and forth will be a challenge even if the conflict ends tomorrow. It is a confidence thing,” the adviser said.

Grace Tang, chief executive officer of Phillip Private Equity, said investors are also asking about moving money to Singapore as a way to safeguard their wealth.

Tang said between 10 and 20 of her clients, most of whom are from Asia, have raised questions about shifting their assets.

Despite these concerns, some wealth management firms say they have not seen widespread plans to remove funds from the United Arab Emirates.

Dhruba Jyoti Sengupta, chief executive of WRISE Private Middle East in Dubai, said clients of his firm remain confident about the country’s economic outlook.

Sengupta said many investors already hold diversified global portfolios while maintaining significant investments tied to the UAE’s development.

“They are sophisticated global investors, already diversified internationally, but deeply invested in the UAE’s growth story,” Sengupta said. “Despite the broader geopolitical turmoil in the region, clients are feeling safe and secure.”

UAE central bank governor Khaled Mohamed Balama said Thursday that the national banking and financial sector remains resilient and stable.

Balama said banks, financial companies and insurance firms continue to operate normally without disruption and are capable of handling developments across the region.

Large wealth management institutions in Singapore are advising clients to monitor the situation carefully. Bank of Singapore and DBS Group said investors are following events in the Middle East while maintaining a wait and see approach for the moment.

Some investors are continuing with expansion projects in the United Arab Emirates despite the regional tension.

Jeremy Lim, co founder of GrandWay Family Office, said he is currently working on plans to open a family office in Abu Dhabi.

Lim said the recent events have not changed his strategy as long as the United Arab Emirates does not become directly involved in the conflict and the situation does not escalate further with Iran.

“The real deal breaker for businesses would be if the UAE were to become directly involved alongside one side in a conflict,” Lim said.

(With files from Reuters)

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