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Abu Dhabi bank Al Hilal sees robust profits
Lender expects double-digit profit growth in 2011; Plans Islamic bond issue in 2011 or 2012; To open four UAE branches in 2011, one in Kazakhstan;
July 6, 2011 4:24 by Reuters
Abu Dhabi government-owned Al Hilal Bank sees double-digit growth in 2011 profits driven by its retail and corporate businesses, its chief executive said.
The lender may tap debt markets this year or next, and is considering launching a sukuk — Islamic bond — and will seek a corporate rating before the sale, CEO Mohamed Berro said in an interview on Wednesday.
“Our retail and corporate side are growing well. Healthy, double-digit growth in 2011 is sustainable,” Berro said.
“You might see Al Hilal going to the capital markets for diversification of funding, if not at the end of this year, then next year,” he said. “A rating is on the frontburner.”
The Gulf region has seen a surge in bond sales recently, driven by investor interest for high-yield debt globally.
The unlisted bank, set up in 2008 and wholly owned by the Abu Dhabi Investment Council (ADIC), earned its first profit — of 140 million UAE dirhams ($38.1 million) — last year.
Berro said the lender plans to expand its retail operations by opening four branches in the United Arab Emirates this year, taking the total to 23.
Internationally, the bank is opening its third branch in Shymkent, south Kazakhstan, this month, he said.
Al Hilal is also eyeing a foray into another international market, the CEO said, but declined to give more details.
Earlier this year, the bank raised its paid-up capital to 2.6 billion dirhams from 2 billion. Its authorised capital is 4 billion dirhams.
Al Hilal is devising its next five-year growth strategy, aiming to break into the top league of UAE banks, Berro said.
“We want to be among the top 10 banks (in asset size) in the UAE and among the top three Islamic banks,” he said. It is ranked 11th now.
Banks in the UAE have suffered since the financial crisis as a property market slump brought rising provisions and losses.
($1 = 3.673 UAE Dirhams)
(Reporting by Stanley Carvalho & Rachna Uppal, Editing by David Hulmes)