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Dubai’s Sheikh Ahmed: local banks have ample liquidity
As chairman of Dubai's Supreme Fiscal Committee, Sheikh Ahmed says that although local companies still haven't rebounded from the debt crunch, banks have sufficient liquidity to weather a second downturn.
October 3, 2011 1:43 by Reuters
Local banks in Dubai have sufficient liquidity to weather a global downturn, the chairman of the Gulf Arab’s largest bank and a key figure in its recovery from a 2009 debt crisis said on Monday.
Sheikh Ahmed bin Saeed al-Maktoum, who is also chairman of Dubai’s Supreme Fiscal Committee, also said some local firms still had a way to go to rebound from Dubai’s debt crunch.
A deepening debt crisis in Europe as well as a slowdown in the UShave increased odds for another global recession this year.
European bank stocks have slumped sharply since July on concerns about their ability to cope with the potential impact of a Greek debt default.
“(Local banks) have lots of cash and lots of liquidity as well,” Sheikh Ahmed, the uncle and close adviser to Dubai’s ruler, told reporters. “We’re not directly affected (by Europe) but I’m sure some (foreign) banks which are here could have certain issues. But the world will never be with no crisis.”
Foreign banks “will keep supporting the retail business here because it’s good for them,” he added.
Sheikh Ahmed, who was named chairman of Emirates NBD in June, oversaw Dubai’s bid to restructure $25 billion in debt after it announced a shock standstill in November 2009 and became the business face of Dubai.
“I think the core business of Dubai is doing well,” he said, citing tourism and exports. He is also chairman of Dubai government-owned Emirates airline
Asked whether the worst of Dubai’s debt problems were behind the emirate — several Dubai-related entities are still undergoing debt restructuring — he said there was still room to go.
“Some other companies have some work to do,” he said. “For example Dubai World, they have some more years of restructuring, seven, eight years.”
Dubai World signed a final deal with creditors in March to repay its obligations over five to eight years. (Reporting by Humeyra Pamuk; Editing by Amran Abocar)
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