United Arab Emirates

Sharia regulator will cut costs of Islamic banks: Al Mansoori

The proposed Shariah regulatory authority in the UAE will greatly benefit the local Islamic banking and finance industry an also help reduce the cost of institutions offering Islamic financial services, said Mubarak Rashed Al Mansoori, Governor of the UAE Central Bank. The proposed Shariah authority will have the key objective of – among others – issuing fatwa for products and services; introduce new and adopt existing international standards; documents regulations related to Islamic financial services; advise central bank on Shariah bank regulations to conduct monetary and financial surveillance. Al Mansoori said banks in the UAE have been innovative and creative in terms of introduction of the new Islamic products.

Abu Dhabi Islamic Bank raises Dh504m in rights issue

Abu Dhabi Islamic Bank (Adib) said on Monday it has raised Dh504 million in its rights issue, which was nearly three times oversubscribed, with Dh1.46 billion in subscriptions received. Following the close of the subscription period on September 10, all 168 million shares were fully subscribed, the bank said in a statement. The rights, which were traded on the Abu Dhabi Securities Exchange, offered investors Adib shares at a price of Dh3 per share, and are part of the bank’s plan to raise capital to support growth.

UAE's DAMAC says unit raises $100 mln via sukuk certificates

Dubai's DAMAC Properties said on Tuesday that it raised $100 million through private placement of 18-month sukuk certificates. The certificates, rated BB by Standard & Poors, were issued by its unit Damac Real Estate Development Ltd, it said in a bourse statement. Emirates NBD was the sole lead manager for the transaction.

Dubai Islamic Bank makes shock Shariah exit from Albaraka Türk loan

In an unexpected move, Dubai Islamic Bank (DIB) pulled out of Albaraka Türk's latest $450m murabaha loan because it did not think the loan was Shariah compliant, according to two bankers on the deal. Turkish participation bank Albaraka Türk has signed a $450m-equivalent one year loan, which it increased from the $400m launch size.

Indonesia celebrates listing of largest sovereign Sukuk issuance in Dubai

Bambang Bodjonegoro, the Indonesian Minister of Finance, today rang the market-opening bell to celebrate the listing on Nasdaq Dubai of four Sukuk valued at six billion US dollars (AED 22 billion), issued by the Indonesian government under its Trust Certificate Issuance Programme since 2012. The Islamic bond listings are the largest ever carried out by a sovereign issuer in Dubai. Indonesia’s four Sukuk listings comprise one issuance of two billion USD dollars AED 7.3 billion), two of 1.5 billion US dollars (AED 5.5 billion) each, and one of one billion USD dollars (AED 3.7 billion). All listed on Nasdaq Dubai on May 31, 2015.

Investment Corp. of Dubai Said to Seek $500 Million Loan

State-owned Investment Corp. of Dubai is reportedly raising a $500 million loan. The facility will be provided by Emirates NBD and Dubai Islamic Bank. The money will fund the expansion of its Atlantis, The Palm resort in Dubai. ICD and Kerzner International Holdings, a developer and operator of destination resorts and luxury hotels, plan to spend $1.4 billion to build The Royal Atlantis Resort and Residences. The development on Dubai’s man-made island will add nearly 800 guest rooms and 250 luxury residences. ICD acquired Atlantis, The Palm from Dubai World in December 2013.

Iranian investment in Dubai property likely to rise

Iranians are likely to become major buyers of Dubai property again if sanctions against the Islamic Republic are lifted, providing a much-needed fillip to the emirate's real estate sector. Dubai property prices have fallen slightly this year, ending a sustained rebound from 2008-9 crash after tougher regulations to deter speculators, a slump in oil prices and weakening confidence in the global economy dampened sentiment. In 2010, Iranians were the fourth largest foreign buyers of Dubai property, behind India, Britain and Pakistan, and accounted for 12 percent of real estate transactions.

Beehive P2P finance platform obtains independent Sharia certification from Shariyah Review Bureau

Beehive, UAE’s online marketplace for peer-to-peer (P2P) finance, has been certified as a Sharia-compliant P2P finance platform by the Shariyah Review Bureau (SRB). The SRB review was conducted over a period of several weeks in June and July 2015 during which SRB’s Sharia scholars reviewed all operational processes, documentation, and relationship management on Beehive’s Islamic platform. As the first online marketplace for P2P finance in the UAE, Beehive has channelled over AED 15 million ($4m) worth of finance to more than 32 small and medium-sized enterprises (SMEs) since its launch in November 2014. Finance requests on Beehive are processed under a ‘Commodity Murabaha’ structure, using the ‘DMCC Tradeflow’ platform.

Abu Dhabi National Takaful Co. receives favorable financial rating

A.M. Best this week moved Abu Dhabi National Takaful Co. (ADNTC) from stable to positive with a financial strength rating of B++. ADNTC’s solid risk adjusted capitalization and track record of excellent underwriting processes are reflected in the new ratings. These positive factors were partially offset by an accumulated deficit within the policyholders’ fund and a modest, albeit growing, business profile. The revised outlook reflects ADNTC’s improved balance of earnings between policyholder and shareholder funds and enhanced enterprise risk management.

Arcapita on investments in Saadiyat and beyond

Arcapita recently acquired Phase One of Saadiyat Beach Residences, a premium residential apartment complex in Saadiyat, Abu Dhabi, for a reported $200 million. Built by Mubadala Development Co., the complex boasts three low-rise buildings in a gated community developed in 2013. It is under a three-year master lease to the Tourism Development & Investment Co. Arcapita has been actively sourcing for new real estate deals within the region, which includes Abu Dhabi. The firm's current focus sectors are residential and logistics. Additionally, on a global basis, Arcapita looks forward to closing a number of real estate and private equity transactions in the coming months.

Caution is the watchword among bankers

Bankers expect the overall profitability to be moderate this year while top-line growth is expected to be significantly lower, while factors such as improved recoveries, stronger collateral values and lower provisions could continue to boost their bottom lines. Non-performing loans (NPLs) and provision figures for the first two quarters confirm this argument. For Emirates NBD (ENBD), during the first half, the impaired loan ratio improved to 7.4 per cent from 7.9 per cent at the end of 2014. For Mashreq, NPLs remained stable at Dh2.8 billion in June 2015, leading to NPLs to gross loans ratio of 3.7 per cent at the end of June 2015.

Junk no problem for yield hunters as Damac tops sukuk in Dubai

For debt that’s off limits to many banks in the Gulf region, junk-rated Damac Properties Dubai Co’s securities aren’t doing badly at all. The company’s $650mn of bonds maturing April 2019 were the best-performing sukuk in Dubai during July, returning almost 70% more than their nearest rivals. Even after the gains, the yield at 6.45% remained the highest for any non-perpetual Islamic bonds in the emirate as of July 31. While most regional banks don’t hold junk-rated bonds in their books due to capital adequacy requirements, estimates that sales may quadruple this year are boosting the allure of the Dubai developer’s debt to investors seeking higher yields in anticipation of the first US interest-rate increase since 2006.

Emirates Reit first-half property earnings increase

Emirates Reit yesterday posted an 8 per cent rise in first-half earnings generated by its properties, thanks to higher rents and service charge ­income. Revenue between January and June reached US$19.1 million, up 7.9 per cent from $17.7m for the same period last year. Net income grew 6 per cent to $44.7m because of a $31m gain from the revaluation of its properties. The company said its investment properties were valued at $613.4m as of June 30, up 9.6 per cent from $559.7m for the year-earlier period. Emirates Reit has $1.3m of property that is being fitted out. About $344m worth of its investment properties have been mortgaged against Islamic financing facilities.

Dubai Bank to divest holding in BankIslami

Dubai Bank PJSC wants to sell its shareholding in BankIslami Pakistan, a stock filing said on Wednesday. Another shareholder, Jahangir Siddiqui and Company, reported that it has received a letter from the UAE-based bank, saying it wants to sell 144.2 million shares in BankIslami Pakistan. The stake that Dubai Bank PJSC wants to sell constitutes 14.3% of the total issued shares of BankIslami Pakistan. Dubai Bank is offering its stake to Jahangir Siddiqui and Company and another (unnamed) shareholder of BankIslami Pakistan under its shareholders’ agreement that mandates a right of first refusal on a proportionate basis.

Standard Chartered Said to Pick U.A.E. CEO, Islamic Head

Standard Chartered Plc has selected global head of audit Julian Wynter as its chief executive officer for the United Arab Emirates. Wynter’s appointment has yet to be announced officially. Wynter, based in London and previously CEO of the bank’s Malaysian business, will replace Mohsin Nathani, who resigned in April. The bank has also appointed Sohail Akbar as CEO of its Islamic banking unit, known as Saadiq. Akbar is currently based in Malaysia as group chief operating officer of consumer banking and group Islamic banking. Standard Chartered is experiencing a management exodus after Bill Winters took over as CEO from Peter Sands last month.

Bahraini insurer ARIG plans full ownership of Takaful Re

Bahrain's Arab Insurance Group is in discussions to take full ownership of Dubai-based Islamic reinsurer Takaful Re, as regulatory moves add pressure on firms to consolidate. ARIG is planning to buy the remaining 46 percent of shares it doesn't already own in Takaful Re, subject to shareholder and regulatory approval. Major shareholders of Takaful Re include Dubai Investments, Emirates Funds, Emirates Industrial Bank and the Islamic Development Bank, each holding a 10 percent stake. The regulatory measures have already prompted some consolidation steps, like Bahrain Kuwait Insurance Co raising its stake in local peer Takaful International to 40.9 percent.

Abu Dhabi Islamic Bank to begin $137m rights offer on Aug 23

Abu Dhabi Islamic Bank's (ADIB) 504 million dirham ($137.2 million) rights offer will begin on Aug. 23, after shareholders approved the capital-raising plan. The lender will issue 168 million new shares in order to support its growth. The issue price is 3.0 dirhams. Each existing shareholder will have the right to subscribe to 56 new shares for every 1,000 shares held at the end of trading on Aug. 13. Subscriptions will start on Aug. 23 and end on Sept. 10. ADIB posted a 10.5 rise in its second-quarter net profit on Wednesday, beating analysts' estimates as fee income grew.

Al Hilal Bank in boardroom reshuffle after twin resignations

Al Hilal Bank has reshuffled its board after the abrupt departure of its chairman and chief executive within a week of each other. The Abu Dhabi-based Islamic bank said a new board had been appointed under the chairmanship of Mohamed Abdullah Al Rumaithi, following the resignation of the former chairman Ahmed Ateeq Al Mazrouei on Monday. Mr Mazrouei’s decision to quit came just a week after the resignation of the chief executive Mohamed Jamil Berro. Sarie Asaad Arar, previously the bank’s chief business officer, was appointed last week as the acting chief executive. The bank said both resignations were for “personal reasons”, declining to give details.

Chairman of Abu Dhabi's Al Hilal Bank resigns -sources

The chairman of Abu Dhabi's government-owned Al Hilal Bank has resigned, a week after the chief executive quit. Ahmed Ateeq al-Mazrouei, chairman since 2008, has left for personal reasons. Senior board member Mohamed Abdullah al-Rumaithi has been appointed to succeed him. Last week Al Hilal's chief executive Mohamed Jamil Berro resigned, also citing personal reasons, after seven years with the bank. Al Hilal's profit for 2014 plunged to 90 million dirhams ($24.5 million) from 442 million dirhams in 2013 because of large loan impairments, according to the lender's latest financial statement. The bank's total assets grew to 41.4 billion dirhams from 38.7 billion dirhams.

Al Hilal Bank Group CEO Jamil Berro resigns

Abu Dhabi-headquartered Shariah-compliant lender Al Hilal Bank has announced resignation of Mohamed Jamil Berro as the CEO, a position he has held since the bank’s establishment in 2008. Berro explained that his resignation is due to personal reasons. The bank’s Board of Directors further revealed that Sarie Asaad Arar will be appointed as Acting Group CEO, who currently holds the position of Chief Business Officer at Al Hilal Bank, and possess over 25 years of banking experience in the UAE.

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