Abu Dhabi Islamic Bank Exploring Expansion Into SEA Asia, Africa

Abu Dhabi Islamic Bank PJSC, the United Arab Emirates’ second-biggest shariah-compliant lender, is considering entering markets in South East Asia and Africa to tap demand in countries with a large Muslim population.

The bank has “looked closely” at Indonesia and Malaysia as well as Algeria, Morocco and Jordan, Chief Executive Officer Tirad Mahmoud, told reporters late on Sunday. “We are actively visiting locations where we may be planting a flag” and may consider an acquisition next year as part of the plan, he said.

Banks in the U.A.E. are seeking to expand to diversify revenue and boost growth, which is restricted by the small size of their home market. ADIB, as the bank controlled by Abu Dhabi’s ruling family is known, is present in countries including Saudi Arabia, Qatar, Iraq, Egypt, Sudan and the U.K.

ADIB in 2014 acquired the retail banking business of Barclays Plc in the U.A.E. for 650 million dirhams ($177 million). The bank was also among lenders that bid to buy the retail banking assets of Citigroup Inc. in Egypt this year, losing out to Commercial International Bank Egypt SAE last month.

“We will be looking to do deals in 2016,” Mahmoud said. “If it’s a retail business, it’s going to be acquisitions, if it’s going to be a corporate business it will be greenfield.”

ADIB expects lending to grow by four percent to six percent this year, slower than expected industry loan growth in the “high single digit,” Mahmoud said. A slowdown in property transactions, competition and ample cash at banks is hurting growth, he said.

ADIB would like its return-on-equity to be at the higher end of 15 percent to 18 percent, the range for most U.A.E. banks, Mahmoud said. The bank has no plans to sell Islamic bonds or sukuk in the next three months and will evaluate its capital position every quarter depending on growth, he said.

(Bloomberg Business / 06 July 2015)

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Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Consultant-Speaker-Motivator: www.ahmad-sanusi-husain.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com

Aafaq in tie-up to promote Islamic finance

UAE-based Aafaq Islamic Finance recently entered into a strategic agreement with Emirates College of Technology (ECT) to promote Islamic banking and finance.

Under the Memorandum of Understanding (MoU), Aafaq’s ‘Institute of Finance and Management’ will implement occupational training programmes focusing on the Islamic economy, its theories and applications, as well as topics that support banking and financial establishments in general.

The MoU lays the foundation for strong cooperation in terms of human resource development, research and consultancy in the field of Islamic finance.

Aafaq’s CEO Dr Mahmoud Abdelaal and ECT’s president Prof Bruce Douglas Taylor signed the MoU that also enjoins both sides to identify other areas of collaboration to further boost their strengths and attain their respective goals.

Prof Taylor said: “In order for us to be recognized as one of the UAE’s leading private universities, we make important investments to ensure that we provide only top quality teaching, research and community services to all our stakeholders.”

“We put a high premium on the skills of our people in accordance with our commitment to the country’s shift towards a knowledge-based economy. Our agreement with Aafaq, which is known for its expertise in Islamic finance, is a big leap towards the realization of our vision and mission. The MoU will pave the way for us to establish mutually beneficial initiatives that will serve our best interests. We look forward to working closely with Aafaq to explore more fruitful development avenues,” he added.

Dr Abdelaal said: “Our partnership with ECT is yet another valuable opportunity for us to reinforce knowledge and human capital capabilities in the field of Islamic banking and finance.”

“We are confident that the scientific research and consultancy components of our MoU will further drive growth in this sector, thus bringing us closer to our main objective of helping establish Dubai as the capital of the international Islamic economy.

“Our expertise, skills and resources to undertake education, training and research in Islamic banking and finance and other related areas strongly complement ECT’s initiatives aimed at investing in employee development and promoting a research environment as part of its contributions to society. We welcome our partnership with them as both parties are fully committed to producing relevant and meaningful results that will ultimately help in the UAE’s advancement and progress,” he concluded. 

(Trade-Arabia / 07 July 2015)
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Alfalah Consulting - Kuala Lumpur: www.alfalahconsulting.com
Consultant-Speaker-Motivator: www.ahmad-sanusi-husain.com
Islamic Investment Malaysia: www.islamic-invest-malaysia.com