U.S. investor flight? We see a bargain, say funds

By Natsuko Waki

DAVOS, Switzerland (Reuters) - Rather than pack up and leave the United States fearing recession, banking and corporate leaders in Davos were looking for bargains in the U.S. financial sector, battered by the credit crisis.

Policymakers, managers of burgeoning state-run investment funds and heads of major investment banks at the annual meeting of the World Economic Forum said the United States was the best place to be at a time of a global slowdown.

This is because the rest of the world is likely to suffer a sharper downturn than the world's largest economy.

"This is a pure investment opportunity," said Bader Al Sa'ad who runs Kuwait's $200 billion-plus sovereign wealth fund.

His Kuwait Investment Authority, which spent $5 billion in buying stakes in troubled U.S. banks Merrill Lynch MER.N and Citigroup (C.N) this month, is looking at the U.S. financial and real-estate sectors -- which have been the epicenter of the crisis.

"This opportunity doesn't come along every day," Al Sa'ad told reporters.

Bert Heemskerk, chief executive of the Netherlands' Rabobank, said brave investors will put money into banks after some stocks halved in value in the recent sell-off.

"You might need a strong stomach for it but I'm pretty sure that the prices are hovering near the bottom of what they should be," Heemskerk said.