Noor Bank CEO Hussain Al Qemzi has ruled out possibilities of any possible mergers in the UAE’s Islamic banks. The last merger is between First Gulf Bank and National Bank of Abu Dhabi, expected to complete by end of first quarter 2017. The merged entity is likely to create one of the largest banks in the Middle East and Africa, with assets of $175 billion (AED642bn). Al Qemzi said Islamic banks need innovation to integrate and position themselves to offer value and a better choice for Muslim and non-Muslim customers in order to grow. The CEO said a shortage of Sharia scholars was also impeding growth of the Islamic finance industry with many institutions in the country sharing advisors.
Applications for Islamic car loans in the UAE grew by 64.79% from 2015 to 2016. Despite growth in Islamic car loans, car loans based on traditional finance were more popular among UAE residents in 2016. Emirates NBD’s Feature-Packed Auto Loan was the most applied-for car loan in 2016. The second most applied-for auto loan of 2016 was that of HSBC, the third, fourth and fifth most applied-for car loans of 2016 were from Islamic banks. Emirates Islamic’s Auto Finance product came in third place, while Noor Bank’s Auto Finance and Ajman Bank’s Car Finance came in fourth and fifth respectively.
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.
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.
Noor Bank has committed its support to the art and design exhibition at the Global Islamic Economy Summit (GIES 2016). GIES 2016 is scheduled between 11-12 October at the Madinat Jumeirah Hotel in Dubai and is under the patronage of His Highness Sheikh Mohammed bin Rashid Al Maktoum. The summit is anticipated to convene more than 2,000 policymakers to discuss key developments of the Islamic economy sector. Speaking on the bank’s participation in GIES 2016, Hussain Al Qemzi, CEO of Noor Bank, said that this event deeply resonated with Noor Bank’s core values. Noor Bank is looking forward to showcasing the exhibition which features signature art works of this year’s emerging artists alongside established names in the field.
Highlights and Performance
Bloomberg Malaysia Sukuk
Bloomberg Malaysia Sukuk Ex-MYR Total Return and Dow Jones Sukuk Total Return indices ended relatively flat at 103.9 (+0.02%) and 159.8 +0.01%) respectively, with yields tightened marginally by 0.6bps to 2.470%. Combined with the Fed‘s dovish meeting (June 15), uncertainty over the Brexit referendum jitters (June 23) and mixed signals from China over slowing economy bring the risk-adverse sentiment. The top performers over the week were INDOIS 3/26 and GS 9/19, which moved -11bps to -13bps; while the underperformers were dominated by banking papers — EIB 1/17, Noor Bank B3T1 and DIB B2T1 which widened 12bps each.
Bank Indonesia cuts key policy rates by 25bps in a surprise move, with the BI rate, deposit facility rate and 7-day reverse repo rate now stand at 6.50%, 4.50% and 5.25% respectively. In addition to the rate cut, BI also raised the minimum threshold on loan-to-funding ratio to 80% from 78%. Indonesia risk premiums widened 1.5bps to 196.0bps.
Noor Bank has successfully priced its debut perpetual $500 million Tier 1 capital issuance, the first issuance from UAE in 2016. The final pricing came on the back of global roadshows across Middle East, Asia and Europe with an order book crossing over $1 billion. Citi and Standard Chartered were the joint global coordinators for the issuance, whilst Dubai Islamic Bank, Emirates NBD Capital, First Gulf Bank, Noor Bank and Sharjah Islamic Bank acted as the joint lead managers for the issuance.
Dubai’s Noor Bank has picked seven banks to arrange investor meetings ahead of a potential Tier 1 dollar-denominated sukuk issue. Joint global coordinators include: Citi, Standard Chartered, Dubai Islamic Bank, Emirates NBD Capital, First Gulf Bank, Noor Bank and Sharjah Islamic Bank. Dubai’s government owns 48% of Noor Bank, which starts to hold meetings with fixed income investors in the Middle East, Asia and Europe.
Abu Dhabi-listed Sharjah Islamic Bank said on Monday it had obtained a three-year, $265 million syndicated murabaha financing facility from a group of banks.
ABC Islamic Bank, Dubai Islamic Bank, Emirates NBD Capital and Noor Bank were lead arrangers and bookrunners, Sharjah Islamic said without giving pricing details.
Noor Bank reported a net operating profit of Dh561 million for the year 2015, up 40 per cent compared to 2014. The bank attributed increase in profitability to a 73 per cent surge in fee and commission income and a 35 per cent rise in net income from financing. Bank’s total assets increased 36 per cent to Dh39 billion in 2015 compared to Dh29 billion in 2014. While customer financing grew by 29 per cent during 2015 customer deposits were up 35 per cent to Dh32.1 billion last year.
Noor Bank was named the "Most Socially Responsible Bank"™ at the "2015 Islamic Business Awards"™ ceremony hosted by the reputed CPI Financial. Amjad Naser, Head of Sharia™, Noor Bank, collected the award at the event, which took place at the Emirates Towers Hotel on 10 December. Noor Bank was honoured for its commitment towards enhancing and enriching the lives of the less fortunate. The CPI Financial judging panel nominated the bank among several other industry leading banks in the United Arab Emirates. Following the initial nomination, Noor Bank was voted the unanimous winner by financial professionals within the region.
Turkish Islamic bank Albaraka Turk has received initial pricing feedback in the 10 % area for a potential U.S. dollar-denominated sukuk issue which would bolster its supplementary or Tier 2 capital, sources familiar with the matter told Reuters on Thursday.
The lender has received indications of interest totalling over $250 million, including those from joint lead managers, for the ten-year non-call five sukuk, the sources said. A potential deal is expected early next week subject to market conditions, they said.
Albaraka Turk, a unit of Bahrain-based Al Baraka Banking Group, has chosen Barwa Bank, Dubai Islamic Bank, Emirates NBD, Nomura, Noor Bank, Standard Chartered and QInvest to arrange the sukuk issue.
Turkish Islamic bank Kuveyt Turk has mandated six institutions for a sukuk with a value of up to $400 million with a maturity of 10 years, it said in a statement to the Istanbul stock exchange late on Thursday.
Kuveyt Turk Participation Bank, which is 62 percent owned by Kuwait Finance House, said it had mandated KFH Capital, Dubai Islamic Bank, HSBC, Noor Bank, QInvest and Emirates NBD as joint lead managers. Sources familiar with the matter told Reuters in September that seven banks had been picked to arrange a potential deal.
Noor Bank is all set to launch a Sharia-compliant and Sustainable Equity Index-linked investment, targeted at the bank’s high-net worth and priority banking customers, the bank’s treasurer Damian White said. Under the new index, the bank will offer its clients a basket of 20 chosen Sharia-compliant European equities screened for sustainability measures. The 100 per cent capital protected investment offers a fixed coupon for the first two years and the uncapped index performance at maturity at the end of three years. The format of the investment is through an Islamic structured deposit.
Noor Bank is set to support an art and design exhibition at the Global Islamic Economy Summit 2015 (GIES) that will run on October 5th and 6th in Dubai. In partnership with Thomson Reuters, Noor Bank will spotlight new Islamic artwork at the event in its role as the official Arts and Design Sponsor of GIES 2015. Additionally, as part of Noor Bank's participation at the landmark summit, Hussain Al Qemzi, CEO of Noor Bank and Chairman of Awqaf & Minors Affairs Foundation will headline a session on Awqaf as a keynote speaker. GIES 2015 is scheduled to take place at the Madinat Jumeirah.
Noor Bank is looking to Indonesia, Turkey and other international markets to escape tougher competition at home and take advantage of a booming global Sharia-compliant finance industry. Thus, Noor Bank plans to help arrange a sukuk or Islamic private placement on behalf of the Indonesian government, with the Dubai-based Islamic finance institution also underwriting part of the deal. Officials declined to specify the amount of the new sukuk but said it would be dollar based and would include other underwriters. The issue will help strengthen Indonesia's forex reserves and help Bank Indonesia maintain the stability of its exchange rate, Finance Minister Bambang Brodjonegoro said.
Dubai-headquartered offshore supply vessel company Stanford Marine Group (SMG) has secured a AED 1.2 billion ($326.7 million) Islamic syndicated structured finance facility arranged by Noor Bank. The transaction is one of the first fully Islamic-backed finance deals in the oilfield services sector. Other participating banks in the deal were: Barwa Bank, First Gulf Bank and Qatar Islamic Bank which acted as mandated lead arrangers, while Ajman Bank and United Arab Bank joined the deal as Lead Arrangers. Noor Bank PJSC also acted as Investment and Security Agent for the deal. The facility will be used to consolidate Stanford Marine Group’s existing conventional and Islamic facilities into a single tranche facility.
A unit of Stanford Marine Group has closed a 1.2 billion dirham ($326.7 million) sharia-compliant loan deal with a group of banks to consolidate its debts into one facility at a cheaper cost, the arranging bank said on Monday. The murabaha-structured facility for offshore vessel operator Stanford Asia Holding Company was arranged by Dubai-based Noor Bank, with five other banks from the United Arab Emirates and Qatar taking part, it said. No pricing or length of the murabaha, a cost-plus-profit arrangement, were provided.
Noor Bank has successfully priced its inaugural five-year $500 million Sukuk today. With the final pricing of 2.788 per cent for the issue, it becomes the lowest ever pricing paid by any Sukuk issuer in the UAE till date. The final pricing came at the back end of global roadshows undertaken across Asia, Middle East and Europe. This pricing of 130 bps over five-year mid-swaps is at the tight end of the final price guidance and compares to initial profit thoughts of 140 bps area. The senior unsecured issuance rated ‘A-’ (EXP) received an overwhelming investor interest from various geographies including the Middle East (54 per cent), Europe (29 per cent) and Asia (17 per cent) wherein more than 45 per cent of the issuance was allocated to European and Asian investors.
Dubai Islamic Bank said on Tuesday it picked eight banks to arrange fixed income investor meetings from Thursday for a potential benchmark size dollar-denominated capital-boosting sukuk issue. These banks, as well as Al Hilal Bank, Emirates NBD, National Bank of Abu Dhabi, Noor Bank, Sharjah Islamic Bank will arrange the roadshows. The meetings will be held in Asia, the Middle East, and Europe and a sukuk transaction which enhances its Tier 1, or core, capital may follow subject to market conditions.