Prince Says Saudis Not Selling U.S. Holdings

Saudi billionaire Prince Al Waleed ibn Talal ibn Abdulaziz al Saud denied Thursday that there was “panic selling” by Saudis of U.S. investments, as had been reported, of $200 billion in reaction to perceived anti-Saudi sentiment.

“I don’t believe at all there is a panic selling and an outflow from the United States,” Al Waleed said, after a report Wednesday by the London-based Financial Times that Saudis had been exiting the U.S. market.

Saudi bankers and analysts also told Reuters they had seen no evidence of massive capital flight from the United States, although new investments could be harmed by the perceived U.S. hostility toward Saudi Arabia.

But a senior Saudi source said that some Arab investors are starting to question the wisdom of leaving their U.S. investments vulnerable to any potential legal action, and need reassurance that their funds would not be seized as the result of a court action.

Saudi individuals and institutions have been named in a $1-trillion lawsuit by families of Sept. 11 victims for allegedly funding terrorism. The suit accuses three Saudi princes, several Saudi and other foreign banks and Sudan’s government of funding key suspect Osama bin Laden.

Al Waleed, commenting on the lawsuit to the Qatar-based satellite station Al Jazeera, said the suit had no connection to U.S. government policy and that it was “based on unrealistic grounds and at the end of the day it will evaporate.”

The Financial Times report, which quoted analysts, said the level of Saudi investment in the United States was $400 billion to $600 billion. Some other bankers estimate total Saudi overseas investment at $500 billion to $700 billion, but official figures for the scale of foreign Saudi investment are not available.

Al Waleed, one of the world’s richest men and a nephew of Saudi Arabia’s King Fahd, said a wholesale exit by Saudi investors in recent months would not have made sense, given the market’s depressed state.

Al Waleed said he had no plans to divest any of his U.S. holdings, which include a stake in Citigroup Inc. worth several billion dollars.