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Abu Dhabi Commercial Bank (ADCB) is planning to slash about 2,000 jobs in the near future. In May ADCB, Union National Bank (UNB), and Al Hilal Bank merged to create the UAE’s third largest bank with 423 billion dirhams ($115 billion) in assets. Before the merger, the three banks employed about 8,500 people. ADCB started laying off employees once it began the merger with the two other banks. While the new entity retained the name ADCB, UNB was delisted and dissolved as a legal entity. Meanwhile, Al Hilal Bank retains its existing identity and continues to operate as a separate Islamic bank within the ADCB Group.

Sharjah Islamic Bank (SIB) raised $500 million in its debut Additional Tier 1 (AT1) sukuk at the lowest price of 5%. Accordingly, the bank’s AT1 Sukuk yield is the lowest in the region, down from 5.25% in 2015. The lender has received orders of $4.8 billion or 9.5x oversubscription from many investors, as well as nearly 209 individual orders from Asia, GCC, and Europe. SIB has appointed Citi, HSBC, and Standard Chartered Bank as joint global coordinators. It also hired Joint Structuring Agents along with Abu Dhabi Islamic Bank, Bank ABC, Citi, Deutsche Bank, Dubai Islamic Bank, Emirates NBD Capital, First Abu Dhabi Bank, HSBC, KFH Capital, and Standard Chartered Bank as the joint lead managers and joint bookrunners. The sukuk is a Non Call 6 years Perpetual Instrument which will reset to 6 years Treasuries in 2025.

A new report on the prospects for fintech in the Middle East and Africa has affirmed the importance of the Gulf Cooperation Council (GCC) region. According to Standard & Poor's, the GCC's most advanced centres are Dubai and Bahrain. "The Future Of Banking: Fintech's Prospects in the Middle East and Africa" report identified five factors necessary to propel fintech adoption: human capital, regulation, financial capital, physical infrastructure and demand, either from established financial institutions or end users. It said North and Sub-Saharan Africa still lagged behind the GCC, where banking penetration stands at just under 80%.

United Arab Emirates’ Sharjah Islamic Bank has hired banks to arrange investor meetings ahead of an issuance of U.S. dollar-denominated sukuk. Citi, HSBC and Standard Chartered have been hired to coordinate the deal, and they are bookrunners along with Abu Dhabi Islamic Bank, Bank ABC, Deutsche Bank, Dubai Islamic Bank, Emirates NBD Capital, First Abu Dhabi Bank, and KFH Capital. The planned sukuk deal will boost the bank’s Tier 1 core capital.

Dubai-based real estate developer The First Group plans to issue $135 million in sukuk. The developer has appointed investment bank Shuaa Capital to arrange the planned transaction. The First Group specialises in hotel investments. It has completed 11 projects in the UAE to date and has seven hospitality developments under construction. This issuance is one of few debt issues in the pipeline in the Gulf region after business slowed sharply during the holy month of Ramadan, which ended last week.

Dubai's ruler Sheikh Mohammed bin Rashid al-Maktoum issued a new insolvency law for companies operating in the Dubai International Financial Centre (DIFC). The new law has been issued following the collapse of Dubai-based private equity firm Abraaj. The firm had a row with some investors over the use of money in a $1 billion healthcare fund. The new law introduces a "new debtor in possession bankruptcy regime" for debtors that have filed for bankruptcy but still hold assets. Abraaj, its founder Arif Naqvi and a former executive are being investigated by the U.S. Securities and Exchange Commission on U.S. charges that they defrauded investors.

Sharjah Islamic Bank is expected to issue U.S. dollar-denominated sukuk by the end of June to boost its Tier 1 core capital. The bank's board approved earlier this year the issuance of sharia-compliant Tier 1 instruments for up to 2.8 billion dirhams ($762 million). Last year, Sharjah Islamic raised $500 million in sukuk with HSBC and Standard Chartered as global coordinators, attracting around $950 million in orders. A few other Gulf issuers are also expected to tap the international debt markets over the coming weeks, taking advantage of cheaper funding costs after a drop in yields on the benchmark U.S. Treasury rates.

According to Bloomberg Intelligence, banks in the United Arab Emirates may go through a second wave of consolidation as lenders seek to improve profitability. Bloomberg analyst Edmond Christou said the absence of common shareholders and a lack of cross-Emirate deals have so far hindered transactions. Abu Dhabi Islamic Bank and Commercial Bank International are among lenders that have under-performed in some areas and could benefit from commercially driven mergers. Most bank mergers in the UAE have so far been driven by common shareholders, making it easier for deals to be completed. Dubai Islamic Bank approved a plan this week to proceed with the acquisition of smaller rival Noor Bank, both of which are controlled by Dubai’s main holding company.

The crucial role of Islamic finance in financing China’s Belt and Road Initiative (BRI) pays homage to the Silk Road and symbiotic relationship between China and the Islamic world prior the 15th Century. Rightfully so, as BRI is the 21st Century’s New Silk Road. Introduced in 2013 by Chinese President Xi Jinping, BRI consists of overland roads and railway systems – The Belt – and maritime highways – The Road. It allows the seamless and efficient transportation of people, natural resources, products, and capital to flow to and from mainland China. The sheer magnitude of BRI finds itself in its financing. A crucial role exists for Islamic financial institutions due to the emerging market of the Middle East, Africa, and South-Asia (MEASA). Jiang Xiheng, Vice President at the China Center for International Knowledge on Development (CIKD), stated the importance of having the United Arab Emirates as a partner in BRI.

Dubai Islamic Bank (DIB)’s board has approved its acquisition of lender Noor Bank to create one of the largest Islamic banks in the world with combined assets of nearly Dhs275bn. Following the completion of the deal, Noor Bank’s operations will be integrated and consolidated within DIB. The new size and scale will allow DIB to expedite its strategy to expand across the far east, sub-continent, and east Africa with Dubai as the hub. The UAE is seeing a wave of consolidations in the market as banks seek to increase capital due to slowing economic growth. Three of Abu Dhabi’s banks are currently in the midst of a merger. That follows the combination of National Bank of Abu Dhabi and First Gulf Bank in 2017 to create a lender with $175bn of assets.

Kuwait International Bank’s (KIB) Chairman Sheikh Mohamed Jarrah Al Sabah announced the issuance of an AT1 Sukuk. On Wednesday 29 May 2019, KIB has successfully priced a $ 300 Million AT1 perpetual Sukuk that classifies under Tier 1 capital at an annual profit rate of 5.625%. KIB received an immense investor demand as evidenced by an oversubscription rate of over 15 times. This issuance has been arranged with efforts made by a group of participating parties including Citi and Standard Chartered who acted as Joint Global Coordinators. Dubai Islamic Bank, First Abu Dhabi Bank, KFH Capital and KAMCO acted as Joint Lead Managers and Bookrunners. Boubyan Bank acted as Co-Manager.

Kuwait International Bank started marketing $300 million perpetual sukuk to boost its tier 1 capital, with a yield of around 6.25%. Perpetual bonds mimic some of the characteristics of equity because they lack a maturity date. Citigroup, Dubai Islamic Bank, First Abu Dhabi Bank, KAMCO Investment Co, KFH Capital Investment Company, and Standard Chartered Bank have been hired to lead the transaction.

Qatar International Islamic Bank (QIIB) remains focused on digitalisation and utilising financial technology. Bank CEO Dr Abdulbasit Ahmad al-Shaibei sees fintech as the future of banking. QIIB cannot afford to miss out, so it is looking closely at the blockchain technology and ways to partner with fintech companies. The bank is investing significantly in the IT infrastructure and considers Cyber security a top priority. Al-Shaibei plans the opening of new branches at commercial malls across the nation as a natural response to the urban development and customer needs. QIIB is a major stakeholder in Umnia Bank in Morocco, where it has not rolled out all banking products, it is currently going through the regulatory procedures. Umnia Bank is a joint venture among QIIB, Credit immobilier et hotelier and the Moroccan Deposit and Management Fund.

Bahrain's Venture Capital Bank (VCBank) announced its acquisition of a significant stake in the Caribou Coffee and Fuddruckers Restaurant franchises in Bahrain. From its first outlet in Bahrain in 2007, Caribou has grown its network to 22 stores, and is ranked among the top three international coffee shop chains operating in the kingdom.

The GCC banking sector is undergoing major consolidation phase with 20 banks negotiating mergers and acquisitions with an estimated $1 trillion worth of assets. The UAE leads the pack with highest number of mergers both in terms of value and volume. Currently, six mergers and acquisitions are being negotiated or underway in the UAE banking worth sector worth $625.25 billion followed by two M&As in Saudi Arabia worth $256 billion and one each in Kuwait and Oman. According to Moody's Investors Service, the recent merger and acquisition drive will help the sector by easing overcapacity and boosting profitability. Moody's Senior Analyst Ashraf Madani says that slow growth and subdued credit demand in the region are the biggest drivers of consolidation.

The Saudi Arabian Monetary Authority (SAMA) has fined 16 financial institutions for violating principles of responsible finance and has instructed them to correct the violations. SAMA stated that the fines were imposed in order to implement principles of justice and transparency without providing details of the fines. The central bank fined some of the Kingdom’s major financial institutions such as Al-Rajhi Bank, Al-Ahli Bank, Saudi Fransi Bank as well as Al-Riyad Bank, Al-Jazira Bank and Dubai-based Emirates NBD Bank. SAMA said that the fines were imposed to ensure fairness and competitiveness of financiers.

Goldman Sachs has bought forward a claim against Bahrain’s TIBC whose default 10 years ago triggered the biggest financial crisis in Saudi Arabia. The Bahraini lender raised money in international markets, transferring the funds to now defaulted Saudi conglomerate Ahmad Hamad Algosaibi and Brothers (AHAB). After TIBC defaulted on a foreign exchange deal, AHAB collapsed along with another Saudi conglomerate Saad Group, leaving an estimated $22 billion in unpaid debts. TIBC, administered by the Central Bank of Bahrain, has a claim of around $3 billion against AHAB, while more than 60 banks that have lent money to TIBC remain unpaid.

Abu Dhabi Islamic Bank (ADIB) revealed it would postpone a monthly instalment for its personal finance customers at no extra charge during the holy month of Ramadan. ADIB annually offers flexible payment to customers during Ramadan to meet their individual needs. Philip King, global head of Retail at ADIB, noted that customers eligible for the Ramadan payment postponement initiative would be informed by SMS, adding that the offer is valid for instalments due between 1 May and 31 May. However, customers are free whether to withdraw or maintain making instalment payments. Throughout the holy month, ADIB hosts Ramadan tents across the UAE that organise Iftars managed by the bank’s employees who have volunteered to be part of the initiative.

In February, Kuwait’s Warba Bank announced the purchase of Ahli United Bank (AUB) and its subsidiary to acquire their collective 75.7% stake in Kuwait & Middle East Financial Investment Company (KMEFIC).
Warba Bank said that the Central Bank of Kuwait (CBK) has rejected its proposed acquisition of a controlling stake in KMEFIC. According to CBK, Warba Bank's acquisition of AUB’s stake in KMEFIC will not have a significant effect on the financial position of the lender. The purchase agreement came at a time when mergers and acquisitions in the Gulf’s financial sector are rising as lenders attempt to improve their financial standing through consolidation.

Qatar Islamic Bank (QIB) announced the launch of its affordable Takaful product for low-income workers called "Family Sheild - WPS". This low cost Takaful product can also be purchased by companies who want to give additional protection to their employees. The plan can be purchased by contributing QR10 per month or QR120 per annum and provides a cover of QR50,000 for death and QR100,000 in case of death due to accident. D. Anand, General Manager of Personal Banking Group at QIB, said the Family Shield WPS Takaful plan was designed for expatriate workers and can be easily purchased instanty over the counter without any medical tests. He added that QIB was well aware of the worker’s concern for their family’s well being in case of unseen events and wanted to provide them with an affordable and useful Takaful solution.