The #UAE-based Emirates Real Estate Fund (EREF) has procured a AED700 million ($190.6 million) Shari’ah compliant finance facility with Emirates NBD. CEO of Emirates NBD Asset Management Tariq Bin Hendi said the facility would enable the bank to complete strategic acquisitions to boost the value of the fund. Over the last 24 months the fund has invested over $163 million in real estate acquisitions including Binghatti Terraces in Dubai Silicon Oasis, Arabian Oryx House in Al Barsha Heights, part of Burj Daman Office Tower in the DIFC and a residential building in Remraam, Dubailand. The partially undrawn facility is a five-year, profit-only Mudharabah facility with a 10% repayment of principal in its fourth year.
Abu Dhabi Islamic Bank (ADIB) has launched its First Shari'ah compliant equity investment structured note of the year 2017. The note is linked to a basket of undervalued blue chip companies from diversified sectors including healthcare, technology & telecommunications. The investment note has a maturity of one year and minimises investment risk by providing 100% capital protection to the capital invested. The note is currently open for subscription until 22 January, 2017 with a minimum investment requirement of $30,000. ADIB’s last three matured equity investment notes have yielded returns of 4.2%, 4.8% and 6.2%, respectively.
Abu Dhabi Islamic Bank (ADIB) has acted as the sole bookrunner on a AED 1 billion Islamic financing facility for the Meydan business group. Dubai Islamic Bank and Al Hilal Bank were both mandated lead arrangers for the financing, which matures in December 2018. The deal was structured to meet Meydan’s financing objectives, on the back of its ongoing District One Project, a master-planned luxury residential neighbourhood in Mohammed Bin Rashid City in Dubai. Commenting on the transaction, ADIB's CEO Tirad Al Mahmoud said this deal demonstrates ADIB's ability to bring together diverse elements with a particular focus on high-growth companies and the real estate sector. Earlier this year, Meydan raised AED 1 billion Islamic financing through a dual tranche offering, comprising a AED 700 million Sukuk issue and a AED 300 million term facility, both maturing in 2024. ADIB acted as the sole coordinator of the transaction.
Dubai Islamic Bank (DIB) sold its stake in Jordan Dubai Islamic Bank. DIB held 20.8% in Jordan Dubai Islamic Bank through a 40% shareholding in MESC Investments. MESC Investments had completed the sale of its stake in Jordan Dubai Islamic Bank to Jordan-based Bank Al Etihad and Etihad Islamic Investment Company. The value of the sale was not disclosed.
ASMA Capital owned by the Islamic Development Bank (IDB), Saudi Arabia’s Public Investment Fund (PIF) and Public Pension Agency (PPA), Ministry of Finance of Bahrain and Ministry of Finance of Brunei has signed a deal with Utico for a significant minority stake. The deal with Utico for a stake in its water business is done through Asma Capital managed IDB Infrastructure Fund II. The deal is valued overall at $ 147 million in equity and project finance and will be completed in the first quarter of 2017. Ernst & Young, Hatch USA, ILFS, GU Advisory UAE, Latham and Watkins, Trowers and Hamlins and Taylor Wessing are advisers to the deal. Utico is making significant investments in the UAE and expanding its infrastructure assets in water, power, transmission and distribution, storage, billing and collection. Richard Menezes, Utico’s Managing Director stated that its model of development has saved the governments billions of dirhams in capital expenditure and subsidies.
Abu Dhabi Islamic Bank (ADIB) is leading a $272m Islamic financing facility for Meydan Group to fund its projects in Dubai. The deal was structured to meet Meydan’s financing objectives, on the back of its ongoing District One Project, a master-planned luxury residential neighborhood in Dubai’s Mohammed Bin Rashid City.
Dubai Islamic Bank and Al Hilal Bank were both mandated lead arrangers for the financing, which matures in December 2018. Tirad Al Mahmoud, CEO of ADIB, said: “[The deal] also evidences the results we are achieving through stepping up our corporate financing activity, with a particular focus on high-growth companies and the real estate sector.” The deal will help utilise financing for the group’s current and future projects including those along the Dubai Water Canal. The funding will also help finance continued investment across all Meydan areas.
The fintech event, held earlier this month, was organised by GlassQube and Startup Weekend, a global movement coordinated by TechStars and supported by Google for Entrepreneurs, with the support of Abu Dhabi Global Market, Abu Dhabi’s financial free zone and financial regulator, and Temenos, a global financial software vendor. It brought together more than 100 developers, designers and aspiring entrepreneurs – many of are at university and some still at school – and challenged them to build a functional minimum viable product.
"We took those products and judged them based on their technical aspects, their commercial viability, how thoughtful those teams were about what is the actual potential of these products and services to find a market," says Bernard Lee, GlassQube’s chief executive and a co-founder.
"What’s important here is that it’s not just an idea. It is how do we take this idea and how do we actually convert it into something that is real? Something that shows how a consumer base can potentially interact with this particular application."
The participants discussed the outcomes of a workshop held on 8 December outlining the strategic goals and future objectives for Islamic economy and also examined steps forward for the Centre and its partners in developing initiatives and programme implementation mechanisms.
His Excellency Sultan bin Saeed Al Mansoori emphasised that in order to realise the vision of His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, to position Dubai as the capital of Islamic economy, DIEDC needs to continually adapt its Islamic economy strategy to reflect emerging trends across the sector’s dynamic pillars.
The Emirates Islamic Bank recently organised an ‘Innovation Day’ where various internal teams shared and showcased their innovations with working prototypes, to the bank’s management.
Emirates Islamic staff across business units participated in the event, designed to ideate and showcase innovative solutions in banking and financial technology. Emirates Islamic’s Innovation Day was aligned with the National Innovation Strategy launched by His Highness Sheikh Mohammed bin Rashid Al Maktoum, UAE Vice President and Prime Minister and Ruler of Dubai as a primary tool to achieve UAE Vision 2021 in the finance and banking sector.
Commenting on the bank’s push toward innovation, Jamal Bin Ghalaita, CEO of Emirates Islamic said: “Banking today demands an innovative and fresh approach to keep pace with the evolving needs of our customers. Tapping into our internal talent pool for ideas allows us benefit from their varied skills and experience to create products that match customers’ expectations and needs.
Emirates NBD has launched the new edutainment mobile simulation game Banki in its efforts to promote financial literacy in the #UAE. Banki will target the country’s youth to become economically aware at a young age and consider careers in the banking and financial services sector. Banki allows users to play five engaging games that help them understand the concept of savings, trading, simple financial transactions and digital banking. They can learn about the basics of banking products, financial services, stock markets, economics and additional topics aligned to the Ministry of Education’s curriculum. Husam Al Sayed, Chief Human Resource Officer at Emirates NBD said the launch of Banki aims to communicate the benefits of being financially literate to the next generation of customers. Available on both the Google Play and Apple stores, the edutainment game can be downloaded for free and can be used by registering with an email ID.
According to Noor Bank's CEO Hussain Al Qemzi, Islamic banks need to understand that they need to provide efficient and transparent services to their clients. Just being Sharia compliant cannot make a product less transparent and more expensive to access. Technology remains an important driver for innovation. Islamic banks that only look at product development and not product delivery or customer acquisition, will risk being left behind. There is a need to continue product development. Variable return products need to be developed and propagated in the market. According to Al Qemzi, it is important to refute traditional sayings that Sharia compliance limits innovation. Sharia principles reject prohibited practices but do not reject innovation. Progressive Islamic education is a key area, the Islamic banking curricula have to be developed so that they combine financial sciences with other economic sciences.
According to Abdulla Mohammed Al Awar, CEO of Dubai Islamic Economy Development Centre (DIEDC), leveraging the opportunities that Islamic banking and finance instruments represent is now more critical than ever before. DIEDC has identified a five-pronged approach to achieve this. First, Islamic economy has to be treated as one organic ecosystem that transcends borders and special interests. Second, a partnership is needed between Islamic and traditional finance to develop real projects in which both can work as stakeholders. It is also important to look for new strategic partners, not excluding countries that are experiencing internal conflicts. Such partnerships should be a true reflection of mutual interests. Islamic financial institutions have to factor in inclusive development and social impact as key priorities.
Trading of shares in Abu Dhabi Commercial Bank, Union National Bank and Abu Dhabi Islamic Bank were suspended on Sunday. The shares jumped last week because of renewed speculation that the Abu Dhabi government might engineer a merger between ADCB and UNB, and another between ADIB and Al Hilal Bank. Both moves would be part of an efficiency drive. There was no immediate official statement from the banks, but banking industry sources said the banks were expected to send statements denying that they had plans to merge.
The newly formed Islamic investment bank ADCorp has named Talal Al Zain as its chief executive. Its two main shareholders, Abu Dhabi Financial Group (ADFG) and GFH Financial, said the new company has an authorised capital of US$100 million and will be the first Sharia-compliant institution in Abu Dhabi Global Market. Mr Al Zain, formerly chief executive of PineBridge Investments Middle East, said that ADCorp would focus on corporate finance, wealth and asset management for institutions and ultra high net worth clients. He said that geographically the firm’s investment strategy will allow ADCorp to become the long-term business partner of choice for clients in the region.
According to EY’s GCC Wealth and Asset Management Report 2016 'Global forces drive regional realities', the larger local banks in the GCC are approaching saturation in their home market and are starting to venture out to new markets such as Africa. George Triplow, EY's Wealth and Asset Management Leader says the UAE’s strong ties with African markets has encouraged a number of African businesses to use Dubai and the Dubai International Financial Center as an infrastructure hub. The regional retail wealth management sector faces the ongoing issue of lack of transparency and independence. According to Triplow, the key would be to provide lower costs, genuinely independent advice and technology-supported portfolio diversification with a focus on passive funds and exchange-traded funds, rather than complex structured products.
Nasdaq Dubai and IdealRatings have launched a suite of indices tracking the performance of global Islamic bonds. The indices may serve as the underlying to future investment products including exchange-traded funds. To be eligible for inclusion in the indices, each bond must have a minimum size of at least $100m, a remaining time to maturity of at least three months, and must be approved by a Shariah accredited board. The Nasdaq Dubai IdealRatings Sukuk Index family comprises the Global Sukuk Index as well as several indices covering distinct segments of the market. They include investment grade issuances, issuances by sovereigns, issuances by corporates, issuances by financial institutions and Gulf Cooperation Council (GCC) issuances. As of 1 October 2016 the Global Sukuk Index has returned 3.1% year-to-date and 15.2% since the index’s base date of 1 November 2012.
Noor Bank closed an AED 850 million Syndicated Islamic Financing Facility for Ajman Bank. The two-year Shari’a compliant facility shall be utilised towards Ajman Bank’s future growth plans. Noor Bank was mandated for the second time to act as Lead Arranger. Dubai Islamic Bank, First Gulf Bank, Sharjah Islamic Bank, The Arab Investment Company and Warba Bank joined the deal as Mandated Lead Arrangers, while National Bank of Bahrain participated as an Arranger. Commenting on the facility, Noor Bank's CEO Hussain Al Qemzi said that this syndication was testament to Noor Bank's service quality and the relationship amongst the two institutions. He expressed his gratitude to Ajman Bank and all the partner banks who helped to close the transaction.
Gulf Islamic Investments (GII), a UAE based Islamic financial services company, announced the closing of US.$145 million fund raising for Apttus, a Silicon valley based software company. The funds will be used to complete the Quote-to-Cash customer process and the Procure-to-Pay supplier process. This is the fourth company out of Silicon Valley for which GII has raised funds for in the last 2 years, bringing the total amount raised to $350 million. GII further confirms a continuing partnership with Apttus to lend strong support to the company’s business development and market penetration in the GCC region. According to GII Founding Partner, Mohammed Alhassan, Apttus provides a golden opportunity at the level of business model and also in terms of achieving satisfying returns.
Etihad Airways plans to issue a debut US dollar-denominated benchmark sukuk and will soon meet investors to determine its size, maturity and interest rate. Investors said the sukuk could be as large as $1 billion. HSBC, JP Morgan, National Bank of Abu Dhabi, Abu Dhabi Islamic Bank, Dubai Islamic Bank and First Gulf Bank are the deal underwriters, according to an investor presentation dated Nov. 3. The airline, whose credit is rated A by Fitch, reported total revenues of about $9 billion in 2015. At the end of last year it had 121 aircrafts and it plans to take delivery of a further 188 by 2026.
Dubai Green Economy Partnership (Dubai GEP) has signed an agreement with Emirates Islamic to provide easy financing options for consumers in Dubai to purchase green products on the Green Deal website. The agreement was signed on the sidelines of the World Green Economy Summit (WGES) recently. According to Faisal Aqil, Deputy CEO at Emirates Islamic, the bank will offer flexible financing schemes at competitive rates. He expects that a convenient financing option will be a huge incentive for the higher uptake of products from the Green Deal platform. The Green Deal site features products that can improve sustainability in day to day life, which include technologies for Energy Efficiency, Solar Energy, Energy Auditing, Water Efficiency and Thermal Control.