DIB eyes acquisitions in Asian markets



REUTERS

Published — Friday 3 May 2013

Last update 3 May 2013 3:53 am

| نسخة PDF Print News | A A

DUBAI: Dubai Islamic Bank (DIB) has dealt with much of its balance sheet weakness and should see profits for 2013 grow in the high double digits, allowing it to eye acquisitions in new markets in Asia, officials said.
Leaders at the world’s oldest sharia-compliant lender told Reuters it had put aside around AED 5 billion ($ 1.36 billion) against the sort of soured property loans and transactions which drew into question Dubai’s future as a financial hub in 2009.
In his first media interview since taking over to deal with the fallout of the 2008 global crisis, Chief Executive Abdulla Al-Hamli said the bank was now anxious to expand but was being held back in part by the unrest dominating the Middle East.
His deputy Adnan Chilwan said the bank expects to see close to 17 percent growth in net profit this year after spending the last five years cleaning its books and strengthening its core banking operations.
“I can confidently say that Dubai Islamic Bank has nothing to hide. We are very strong, clean and ready for the next growth phase,” Al-Hamli said.
“2013 has started positively, with first quarter results up by 17 percent compared to last year,” Chilwan said.
“We anticipate similar growth for the remaining part of the year.”
DIB shares are up 43 percent so far this year to 2.88 dirhams, giving it a market capitalization of about AED 10.9 billion. Investment firm Arqaam Capital recently raised its target price for the bank to AED 3 from AED 2.6.
The 38-year-old bank needed government support after the global credit crisis burst the emirate’s property bubble, reducing real estate prices by more than 60 percent over three years after 2008.
Chilwan said the bank had cut real estate investment to 27 percent of its portfolio from 45 percent in 2008 and that it would be happy to trim that exposure further.

“The crisis has made us more aware of our key strengths and focus areas,” he said.
“The bank’s portfolio has changed and will continue to shift away from being real estate specific toward more consumer and wholesale banking.”
DIB’s non performing loans peaked at 14.5 percent after the crisis and dropped to 12 percent by the end of 2012. It hopes to reduce that figure to 10 percent this year.
“Geographically, expansion into Asia makes a lot of sense from where we are placed. One would want to look at Malaysia, Indonesia and maybe India,” Chilwan said.
The bank is also interested in the European markets but won’t be active before the dust settles in the euro zone, he said.
DIB expects to finalize its buyout of Tamweel through a share swap by mid May, Chilwan said, with the sharia-compliant mortgage lender due to be delisted right afterwards.
The bank does not plan to issue more sukuk this year. It was the second Gulf bank to issue a hybrid perpetual sukuk when it priced a $ 1 billion Islamic bond to enhance its Tier 1 capital ratio in March. Its Tier 1 ratio rose to 17.7 percent at the end of March, compared to 13.9 percent as of Dec. 31, 2012.

What's happening around Saudi Arabia

RIYADH: In a fresh boost for relations between Saudi Arabia and Bangladesh, the Kingdom has decided to sign a memorandum of understanding on Foreign Office Consultations (FOC) with Dhaka. The Kingdom endorsed a proposal in this regard at a meeting be...
The Indonesian mission is hopeful detained Indonesian pilgrims will be free “very soon.” The mission is trying to persuade Saudi authorities of their nationals’ innocence.Eleven Indonesian pilgrims, who arrived in the holy city of Makkah to perform U...
JEDDAH: Police at King Khaled International Airport in Riyadh arrested a Saudi hacker after a government organization in Al-Leith in Makkah complained that he had hacked its website, according to an online newspaper.Col. Atti Al-Qurashi, spokesman fo...
JEDDAH: The special criminal court has sentenced a former military official to nine years in jail for joining Daesh and traveling to Syria to fight.A fine of SR5,000 was also slapped on him and he was barred from traveling abroad for nine years after...
JEDDAH: Saudi-Indian ties have reached a new high with the arrival of an Indian Air Force (IAF) flying contingent at the King Fahd Air Base in Taif.The mission, comprising more than 100 high-ranking IAF officers and airmen onboard Sukhoi MKI fighter...
RIYADH: A tripartite agreement among the National Handicraft Program, Prisons Department and the Technical and Vocational Training Corp. (TVTC) was recently signed in the presence of Prince Sultan bin Salman, president of the Saudi Commission for Tou...
JEDDAH: British authorities have opened investigations into the plane crash that led to the death of three members of the Binladin family.Investigations depend on the black box which registers the entire plane’s data, including speed, position of mob...
JAZAN: In a tragic accident, a speeding fuel truck caused four deaths and injuries to many people when it collided head on with five cars on the northern entrance of Abu Areesh area of Jazan, according to a website.The truck deviated from its path an...
JEDDAH: Municipal and Rural Affairs Minister Abdul Lateef Al-Asheikh has directed all the municipal authorities to closely scrutinize the election candidates’ credentials to thwart violation of rules.This is to ensure that the candidates meet all the...
Mohammed Mokammel Hossain, labor consul, Bangladesh Consulate, Jeddah * Which particular aspect of Saudi Arabia you like the most? Two Holy Mosques in Makkah and Madinah.* Can you tell us your favorite and oft-repeated Arabic word? Insha’Allah. * W...
RIYADH: Expatriates feel Saudi Arabia is a safer place than their home countries despite the fact that the Kingdom is leading a war against the Yemeni rebels and other terror organizations and a couple of suicide attacks in the recent past. Mahmoud T...
RIYADH: The maximum medical policy or contract for visitors is SR100,000, which covers expenses on emergency treatment, maternity charges, traffic accident injuries, dialysis and medical treatment in or outside the Kingdom. Making the above announce...
JEDDAH: The city and its surrounding areas sweltered on Monday, with the maximum temperature rising to 44 degree Celsius and relative humidity being recorded at 85 percent. The weather department has forecast a similar situation in Jeddah on Tuesday....
JEDDAH: A National Academy for Energy in Dammam and a private technical technical college, both exclusively for women, will be opened in the Easter Province.The General Organization of Technical and Vocational Training is in the process of implementi...
AL-AHSA: Masjid Joatha or Joatha Mosque is a center of attraction in Al-Ahsa with many visitors and tourists thronging the place of worship, which was believed to have been built in the seventh year of Hijri (629 AD).The mosque has been restored as p...

Stay Connected

Facebook