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Vol. VI. No. 47 May 2010

Editorâ&#x20AC;&#x2122;s note Editor K Raveendran

ravi@sterlingp.ae

consulting Editor Matein Khalid

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Publisher & Managing Director Sankaranarayanan

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Director Finance Anandi Ramachandran

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GENERAL MANAGER Radhika Natu

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Editorial Contributing Editors Anand Vardhan Linda Benbow Vanit Sethi Manju Ramanan

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DESIGN Ujwala Ranade

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Sales and Marketing Account Manager Rashmi Pai ACCOUNTS Biju varghese Circulation Supervisor Printing

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A new excitement

here is no doubt that institutional interest in the SME sector is at an unprecedented level. This is not to suggest that small and medium businesses were inconsequential at any time in the past. But a convergence of initiatives at various levels has taken the sector to a new level of attention and caring. The latest in the series is the move for a legislation at the federal level, which will coordinate initiatives at the level of individual emirates, such as the Mohammed Bin Rashid Establishment for SMEs in Dubai and the Khalifa Foundation for SME Development in Abu Dhabi, and develop these into a national plan for the small and medium enterprises. A new law is learnt to be in the final stages, which will make life easier and financial resources more accessible for the small and medium businesses. The sector had in the past failed to attract the attention that it required for growth from the banking sector, due to a number of reasons, including the availability of more glamorous businesses for the banks to make money from. But as the options got limited, they have turned to the sector in a big way, although many of the challenges that kept them off the sector still remain. But with the institutional interest in the sector reaching a new level, there is considerable excitement about the role and scope of SMEs.

K Raveendran

SterlingPublications FZ LLC Loft Office 2, G 01, Dubai Media City

P.O. Box 500595, Dubai, UAE. Tel. + 971 4 367 2245, Fax +971 4 367 8613 Website: www.sterlingp.ae Email: info@sterlingp.ae Overseas offices: India: Anand Vardhan, DII/89, Pandara Road, New Delhi, 110003. Tel: 0091 1 26517981 BANKING AND BUSINESS REVIEW February Bahrain: Sunliz Publications W.L.L,2010 PO BOX 2114, Manama, Kingdom of Bahrain. Tel: 00973 17276682

BBR Mag FP.ai

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5/2/10

4:28 PM

CONTENTS

RETAIL

Opportunities mixed with challenges

SPECIAL 8

Small is very big

Federal law coming for development of SME sector 14 Credit guarantees critical Higher risk premiums caused by information gaps

20 SME - BANKS SMEs go international Monetary discipline and support are key Opportunities abound Risk-reward balance crucial Unified national policy required SME index a useful tool Handholding to tide over crisis Refinancing for lenders helps 38 SME - COMPANIES European heritage adapted to GCC A well-brewed success Benefiting from oil boom

4 BANKING AND BUSINESS REVIEW

May 2010

46 REAL ESTATE Passion for breakthrough technologies 50 WEALTH Private banking after perfect storm 54 CREDIT RATING S&Pâ&#x20AC;&#x2122;s Gulf Region Series

21282DIBBusiBankSolutions275x205.pdf

5/3/10

10:15:41 AM

RE TAIL

Opportunities mixed with challenges Low credit availability, increasing competition pose threat to industry

he relatively low consumer finance availability, high credit card interest rate compared to the global average due to higher default risk and lack of credit bureau data, and increasing competition are posing a threat to the retailing industry in the GCC. This is further complicated by the expansion of international retailers within the GCC to sustain their global business growth, a new report on the regional retailing industry reveals. But along side there exists a plethora of opportunities as well, the report by Alpen Capital points out. The retail sector is leading from the front in the GCC’s ambition to move away from oil dependency towards a diversified economy. The region is enhancing its footprint in the global retail map buoyed by factors such as healthy population growth, rising per capita income, growing middle class, improving service sector and burgeoning travel and tourism sectors. Moreover, the modern shopping malls anchoring state-of-theart hypermarkets, highly developed free trade zones, various shopping festivals/ events and relaxed tax provision for individuals provide further growth impetus to the sector, the report says. According to Alpen, currently, retail projects of around 6 million sq m of Gross Leasable Area (GLA) are underway, which will constitute the region’s retail space supply by 2012. This reflects optimism amongst mall developers and retailers in general. Race for more retail space in the GCC is not restricted to lo-

6 BANKING AND BUSINESS REVIEW

cal participants; many foreign retailers have initiated their retail operation in the region to leverage on its substantial growth prospects. The rising GLA in the retail space is expected to be matched by demand growth in the sector. Alpen Capital estimates GCC retail demand growth at a CAGR of 9.5 per cent in 2010-12. For 2010, the industry growth is projected at around 8.3 per cent. Growing population and rising per capital expenditure

are key underlying reasons for this demand growth, it points out. “Moreover, we expect robust growth in retail demand from travellers in transit (airport retail) and tourists. Pharmacy and electronic sales, although minuscule in terms of contribution to the total retail scale, are also posting signs of healthy progression,”, the report says. Retailers with focus on non-discretionary goods will continue to outperform in the short term while those promoting discretionary products, large ticket items in particular, may face challenging market conditions for a while. The view is further supported by the 1Q 2010 financials posted by GCC retailers wherein nondiscretionary retailers posted healthy top-line progression while discretionary retailers presented subdued performance. However, over a medium-to-long term horizon, Alpen Capital foresees investment merit also in more cyclical

The GCC is enhancing its footprint in the global retail map buoyed by factors such as healthy population growth, rising per capita income, growing middle class, improving service sector and burgeoning travel and tourism sectors

May 2010

Retailers with focus on non-discretionary goods will continue to outperform in the short term while those promoting discretionary products, large ticket items in particular, may face challenging market conditions for a while discretionary goods segments. Along with significant growth, there has been a qualitative shift in retail consumer behaviour in the GCC. The key trends developing in the region are – rising acceptability of modern retail format, increased preference for international brands, growing prominence of online retailing and enhancing appreciation for innovative ideas and offerings. The rise in population, urbanization, middle class (with increasingly higher per capita income), inflow of tourists and number of passengers in transit continue to provide congenial conditions for retail to develop in the GCC countries. The report projects GLA addition of approximately 6 million sq m in the GCC retail space in 2010-12. “Looking at the region as a whole, we see demand growing at a sufficient pace to absorb the healthy pipeline of new space. That said, some cities, Dubai in particular, will depend on continued

strong growth in tourism to absorb the incremental retail space. Alpen Capital expects the non-discretionary retail segment to continue to register healthy growth momentum in 2010 while the discretionary segment is likely to remain subdued. “We expect revival in demand generated from tourists and passengers in transit to provide a further boost to retail sales in 2010. Further, pharmaceuticals and online retail presents latent growth potential,” it says. Alpen says it expects revival in demand generated from tourists and passengers in transit to provide a further boost to retail sales in 2010. As per its estimates, short-visit tourist retail sales is expected to register revival while sales at duty-free shops at airports will rise significantly under the impact of rising passenger traffic. This rate can be higher than the estimates given the rate at which airport infrastructure work is under progress. Annual events such as the Dubai Shopping Festival will continue to attract international shoppers, the report points out. This encouraging view is substantiated by a 3.3 per cent year-on-year rise in Dubai hotel revenue quarter in the first 2010, the report says quoting a Department for Tourism and Commerce Marketing official. The room occupancy rate increased to 76 per cent in the

first quarter from 73 per cent a year earlier. The majority of the GLA addition is expected in the UAE and Saudi Arabia. Moreover, Qatar is expected to have major addition in GLA in 2012. The higher GLA addition for Saudi Arabia is justified given its high and growing population base – the Saudi population constitutes 63 per cent of the total GCC population and is expected to grow at CAGR of 3 per cent over the next few years. As a result, latent demand existing in the Saudi retail market justifies significant GLA supply growth over the next few years, the report points out. Dubai has the highest GLA per capita in the region and the most at risk of oversupply, but also by far the strongest tourist destination. Therefore, although GLA per capita seems high in relation to its population, this is less of a concern when factoring in tourist spending. Moreover, the tourists have a relatively higher propensity to consume and therefore post higher retail spend per capita, Alpen points out. Given the GLA addition, retail market sizing from the supply-side depends on the absorption rate of additional supply of retail space. It says it would be misleading to assume that the overall occupancy rate in the retail sector is high if new malls are fully occupied. The sector is witnessing a growing preference for newer malls at the expense of older store formats. Considering the mildly uncertain economic environment and risk of a paced absorption of new space in some regions, Dubai for example, Alpen has assumed the possibility of two scenarios: one of moderate growth with an occupancy rate of 60 per cent for the incremental organized retail space in the GCC region in 2010, 65 per cent in 2011 and 70 per cent by 2012. Under this scenario, the occupied GCC retail space would grow at a CAGR of 9.9 per cent in the years from 2010 to 2012, in line with the demand side estimate, it says. The second scenario assumes an occupancy rate of 80 per cent in 2010, 85 per cent in 2011 and 90 per cent by 2012, with the occupied GCC retail space growing at a CAGR of 12.6 per cent in 2010-12.

BANKING AND BUSINESS REVIEW

May 2010

C OV ER SME SPECIAL STORY

Small is very

BIG

Federal law coming for the development of SME sector 8 BANKING AND BUSINESS REVIEW

May 2010

series of legislative and administrative initiatives at the federal governmental and institutional levels is on the cards to help the small and medium enterprise units in making access to financial resources easier and promote the SME sector as a vital growth engine of the local economy. A most significant step in this direction is a new federal law, expected to be issued in the next couple of months, which will outline a new definition of SMEs, procedures of establishing SMEs and meet the capital requirements of the sector. The new law envisages that the Ministry of Economy will be the nodal agency responsible for coordinating various activities for the growth and development of the SME sector. The move for a common definition of the role and size of the SME unit at the federal level follows a similar exercise launched by Dubai, which redefined the SME unit in a more appropriate way so that these units become eligible for bank finance and other administrative support. The Dubai initiative, spearheaded by the Mohammed Bin Rashid Establishment for Small and Medium Enterprises Development, is expected to create a new platform and culture that will help

The Ministry of Economy has prepared a comprehensive proposal to develop the role of SMEs, after a detailed analysis on the current status of SMEs and the challenges faced by the sector

these units meet their various requirements. A number of studies on the sector had highlighted the absence of a uniform definition of the role and identity of the SME sector as the biggest stumbling block for banks and other finan-

cial institutions to provide finance and other support systems for the development of the sector. The ministry has prepared a c ompre h e n s i ve proposal to develop the role of SMEs, after a detailed analysis on the current status of SMEs and the challenges faced by the sector. The plan also includes the proposed new definition of an SME unit at the national level and the draft law on the sectorâ&#x20AC;&#x2122;s development. According to Sultan Bin Saeed Al Mansouri, UAE Minister of Economy, the ministry has studied and evaluated the status of SMEs in the country so as to identify the challenges and opportu-

BANKING AND BUSINESS REVIEW

May 2010

nities in this vital sector. The ministry evaluated the experience of 28 countries in the field of small and medium businesses. “We are keen to coordinate efforts and exchange information with government departments in order to achieve best results and develop the performance of this vital sector,” he said while chairing the meeting of a coordination and economic cooperation committee recently, which discussed the government’s outlook regarding SMEs and the ministry’s mandate in this regard. The challenges faced by the SME sector typically include lack of financing, high operational costs, labour and training issues, absence of marketing network to promote national products and procedural obstacles. The new initiatives are likely to include steps to see that the capital requirements of the SME sector are adequately met while at the same time reducing the bureaucratic and other hurdles in the development of the sector. The Ministry of Economy is in the process of finalizing the draft law for it to be referred to local government SME institutions and Chambers of Commerce in the individual emirates for their comments. It will then be presented at the cabinet for approval. The ministry is also involving the country’s banks in these consultations as the banking sector is expected to play a crucial role in the development of

10 BANKING AND BUSINESS REVIEW

The challenges faced by the SME sector typically include lack of financing, high operational costs, labour and training issues, absence of marketing network to promote national products and procedural obstacles the sector by way of a more favourable credit policy in terms of the small and medium enterprises. Another important proposal under consideration is the launch of a Federal Credit Bureau to compile and provide authentic credit information, a move that will ensure transparency in the market. The credit bureau, which may cover both individual and corporate credit information services, will help the banks and financial institutions to better assess the risk of lending to the small and medium businesses, as the agency will collect and document credit information from various financial authorities, companies, establishments, individuals and banks, in addition to classifying and analysing them. The establishment of a national-level credit bureau is seen as a ‘long-overdue’ step to ensure more efficient credit risk management and thus ensure macro economic stability in the country. The institution of such a mechanism would be helpful to both lenders and borrow-

May 2010

ers as the bank or financial institution concerned will have access to complete information and transparent data about the financial situation of the borrower and their payment behaviour. In early 2006, the Dubai Department of Economic Development had established Emcredit as a governmentbacked credit information services company, but as an emirate-level institution, it suffered from credibility issues outside the emirate, which restricted its appeal to banks, financial institutions and other entities at a national level. Emcredit initially met resistance from the banking sector but is said to have grown since to hold 30 per cent of the country’s mortgage data and 5.6 million individual identification records. But a federal agency is expected to provide much more authenticity to the information sharing process as it will ensure much bigger participation from banks and other institutions. And with the involvement of the regulators, the collaboration between banks and the credit bureaus becomes organic. Credit bureaus help in a big way to create a favourable environment for SME lending as they will help improve the banks’ assessment of debtors by being able to quantify the risk more realistically. Generally banks have been found to reject between 50 per cent and 70 per cent of the applications for credit from SME owners. The most common reasons for the rejection are insufficient documentation, shorter duration of the company’s existence, unsound fundamentals of the business. Some SMEs have looked to enhance their credit standing with banks by getting a rating from credit rating agencies. While the banks are concerned with the risks associated with SME lending,

the owners of small businesses complain that they are not able to get the financing support that they need from the banks. And even if they manage to get some bank to finance them, the interest rates are too high, which is a brake on economic growth. At 20 per cent, the typical interest rate for an unsecured loan is twice the 10 per cent rate prevalent in Western Europe. But according to the banks, the exceptionally high interest rates on unsecured business lending in the UAE are a result of a significant risk premium. The perceived risk has two key reasons: one is the difficulty in assessing the credit quality of businesses in a data sparse environment like the UAE. Also, the UAE has a very informal business culture which leads to incomplete and unreliable financial statements. Banks say it is difficult to distinguish between high and low risk debtors and this is probably the result of an information asymmetry between borrowers and lenders. If banks can improve their assessment of debtors then they will be able to quantify risk more precisely. Banks aim to minimize this risk by screening applicants and granting credit only to those that meet standards. Naturally, the standards for unsecured loans are tighter than for secured loans. The typical criteria followed by banks in lending to SMEs include a minimum period of existence for the company, usually between one and three years, and the availability of financial statements to cover that period, ideally audited, and for smaller companies bank statements (cash flows) over the period. Many banks specify a minimum turn-

over, typically between Dh100,000 and

Dh250,000. Also, small and medium businesses face greater difficulties in accessing finance during the start-up phase. In most developed markets, it is possible to get viability based financing, where an aspiring businessman applies for a loan on the basis of a business plan. On a commercial basis this is effectively non-existent in the UAE, it is pointed out. This presents a great dichotomy in the system. When a business is getting

started and is in need of capital, it struggles to get any credit whatsoever from banks; later, when the business has plenty of money, banks cold-call to offer now-unnecessary credit on favourable terms. Another major problem faced by the SME units, particularly the start-ups, in the UAE is that a majority of them do not fall into the category of SME definition followed internationally. To be a SME or a micro-enterprise, an enterprise has to satisfy the criteria for the number of employees and one of the two financialÂ criteria -- either the total turnover or total invested capital. Internationally, definitions based on

While the banks are concerned with the risks associated with SME lending, the owners of small businesses complain that they are not able to get the financing support that they need from the banks

BANKING AND BUSINESS REVIEW

May 2010

labour force. In the Gulf countries, a small industrial enterprise is generally one with less than $2 million of investment and a medium enterprise is one with $2-6 million invested capital, with units involving an investment of more than $6 million being considered large. What these units generally require is macro-finance, but that is an area which is yet to be developed locally, although bankers consider this to be a significant area of interest in their future strategies. It is pointed out that support of government agencies and institutions such as the Mohammed Bin Rashid Establishment for Small and Medium Enterprises in Dubai and the Khalifa Fund for Enterprise Development in Abu Dhabi is vital in ensuring low cost finance to units of this type. Since its inception, the Mohammed Bin Rashid Establishment has assisted in supporting about 9,000 entrepreneurs to evaluate and start their businesses and facilitated their access to more than Dh720 million in government contracts. The critical role of the Establishment is to develop the leadership of local Emiratis and support their entrepreneurship. Similarly, the Khalifa Fund has provided Dh350 million for 211 projects in the SME sector since its inception in 2007. employee size range from under 250 (European Union) to under 500 (US small business administration). Based on turnover, figures below $50 million are considered indicative of a medium sized enterprise, while below $10 million is a small business. But in the GCC, the definition varies depending on the scale of the national economy and the size of the country’s

12 BANKING AND BUSINESS REVIEW

The most common reasons for the rejection of loan applications by the SME units are insufficient documentation, shorter duration of the company’s existence, unsound fundamentals of the business

May 2010

The typical size of the unit financed by the Khalifa Fund is about Dh1.5 million, which clearly shows the profile of units getting assistance from these government institutions. UAE Central Bank Governor Sultan bin Nasser Al Suwaidi has indicated the possibility of the federal government launching a loan scheme for small and medium enterprises, with special focus on start-up businesses. Under this, the government would offer capital to support SMEs initially, probably in the form of â&#x20AC;&#x2DC;full collateralâ&#x20AC;&#x2122; in the first phase of the initiative as the rate of failure for start-ups is considered to be significantly high. As the Ministry of Economy feels that banks that focus on SMEs and provide low-cost finance to entrepreneurs need to be encouraged, it is creating joint programmes with SME-focused banks. For instance, the bank has signed a Memorandum of Understanding (MoU) with HSBC Middle East, to support the international expansion of the SMEs. As part of the memorandum, HSBC has launched a $100 million fund specifically for UAE companies with a turnover of $30 million or below, which are engaged in cross-border business. The UAE fund is part of the HSBCâ&#x20AC;&#x2122;s global strategy to support internationally focused SMEs, by ensuring that

they have access to appropriate credit to enable them to grow and conduct business internationally. Lending from the fund will be made to SMEs in the UAE that need working capital finance for international expansion, with high priority accorded to Emirati-owned businesses. A recent study by Duns & Bradstreet on the funding of SME sector found that banks with a strategic focus on the SME market try to tailor their credit and other banking products to meet the needs of this segment. They do this

by offering less complex versions of the financial products offered to larger companies, by relaxing do c u ment at ion requirements, and training staff specifically to deal with small businesses. It recommended that the financial services aimed at small businesses should be designed to grow with the business, providing scalable solutions and a smooth upgrade path to larger lines of credit. Smaller businesses often have fewer cash reserves and volatile cash flows and they often depend on access to finance not just for growth but for their survival. The report points out that the smaller sizes of the loans and simpler businesses in the SME market mean that it is logical to reduce turnaround times on credit decisions for banks. The value at risk on a loan decreases, thus it makes sense for the bank to reduce the cost of making a loan decision. Not only that, but in the highly competitive UAE market a customer kept waiting too long may well go elsewhere.

BANKING AND BUSINESS REVIEW

May 2010

Credit guarantees critical Higher risk premiums caused by information gap, lack of recovery mechanism

ankers feel that some sort of a credit guarantee by the government or its designated agencies will go a long way in ensuring adequate bank financing for the SME units as lending to the sector otherwise presents a relatively higher risk proposition. While the banks are doubtless looking at SMEs as a distinct market segment and registering 20-30 per cent year on year growth in lending to the

14 BANKING AND BUSINESS REVIEW

SME sector, they remain cautiously optimistic when it comes to funding them. One of the reasons for their concern is that there is no standardized recovery mechanism to seize the assets of defaulters. Although some legal framework for this may be in place, the results and speed of the process can sometimes lack consistency and involve long delays. Another reason for the uncertainty is that small trading and services companies

May 2010

constitute the majority of the sector and it is quite difficult to predict their long term cash flows or assets that can serve as useful collaterals. The biggest problem, of course, is that there is a fundamental information gap between the lenders and the borrowers with the result that banks are unable to accurately ascertain the creditworthiness of their borrowers, so they add hefty risk premiums to their interest rates. This in turn makes

finance less affordable to the small and medium businesses. Given the high-risk nature of the sector, it is believed that a third of all small and medium businesses do not make it to the bank in terms of funding even under normal circumstances. Crisis situations hurt the sector as much as any other, but these units do not feel the pinch immediately as some payments continue to come by and as such there is a time lag before they are seriously affected. But once that happens, their problems continue to persist beyond the resolution of the crisis. So, the small businesses may be the last to enter the credit crisis, but they are also the last to come out of it. The liquidity crisis is not just one-sided, as the banks are also very much a part of the process and suffer from their own liquidity issues. It is in the backdrop of such a scenario that the banks are asking for help from the government in terms of guarantees and safeguards against default, although they have no hesitation in admitting that the sector is potentially one of the most promising growth area for the banks. “Credit guarantees are quite critical for the banks to ensure expanded credit flow to the small and medium businesses,’ says Hemant Lalithraj, Senior Vice President, Retail Banking Group, SME Business, Mashreqbank. Equally important is the need for greater transparency and monitoring of the sector so that some of the undesirable tendencies shown by the owners of small businesses, such as the diversion of working capital to speculative purposes, as it happened during the property boom, are held in check, he argues. Rajesh Gupta, Head, Products & Segmentation, SME Banking, Standard Chartered, highlights the importance and growth potential of the SME sec-

16 BANKING AND BUSINESS REVIEW

There is a fundamental information gap between the lenders and the borrowers with the result that banks are unable to accurately ascertain the creditworthiness of their borrowers, so they add hefty risk premiums to their interest rates tor, but at the same time points out that the information asymmetry that prevails in the SME sector needs to be addressed. SME units are not known to be good at financial transparency, but in the interest of greater liquidity for funding their growth, the regulators need to encourage them to follow regular financial reporting systems so that it is easier to monitor them. Also, there has to be central registry for the SME sector, which will help the banks in assessing the strengths and weaknesses of the units and assess them more realistically, he said. Nicholas Levitt, Regional Head of Business Banking HSBC, says credit guarantees do help, but points out that there are examples of credit guarantee achieving outstanding success while in some other markets it has flopped.

May 2010

Hong Kong is one place where government guarantees have been packaged into an excellent service and this has contributed tremendously in the growth of the sector. But in certain other markets, it has complicated the issue further, leading to a lot of avoidable bureaucracy and delays, with the result that it simply fails to further the interests of the small and medium businesses. According to Citibank, a key trend of the post-financial crisis environment is that the banks are offering lending facilities linked to clients’ ‘trade cycles’ rather than providing them facilities where there was limited end-monitoring. Citibank says it is looking at innovative lending solutions for companies by mitigating risk through a combination of factors including credit

insurance. Citibank typically adopts a cautious approach to the small and medium enterprise businesses. “Given that all banks are operating in the same playing field, lending across both retail and commercial bank space has been cautious,” a bank spokesman said. Citibank suggests that there should be mandatory filing of financial statements for companies and this could be started with companies where lending is more than Dh250,000. This data is anyway reported by banks to the Central Bank and this will help banks make better risk decisions. Additionally, there is dearth of data on the commercial sector overall. Highlighting the importance of a credit bureau, the bank says that if an independent body can provide credible information, banks will be well positioned to cater to their requirements. A J Vidyasagar, Chief Executive Officer of State Bank of India (SBI), points out that competition is obviously providing greater accessibility to finance as well as credit at cheaper rates to small and medium businesses. “But SMEs are generally considered to be in the higher risk category. Hence post the financial crisis, financial institutions would be more careful in lending to this segment. While there would be no drying up of finance, financial institutions would lay greater emphasis on the security aspect and focus more on sound financials of the company,” he explained. According to Ashok Gupta, Chief Executive, Bank of Baroda, UAE, the SME sector is one of the most adversely affected due to the financial crisis. The working capital requirement of SME borrowers has increased due to delay in sales realization owing to slow down in the market. This has resulted in an increase in demand for working capital finance from SME borrowers. On the other hand their business vol-

18 BANKING AND BUSINESS REVIEW

umes have gone down, which means they need proper hand holding facilities to tide over the crisis. There is also greater need for better monitoring of credit portfolio by the banks to avoid deterioration in the health of credit portfolio, he added. Mohammed Ahmed Wajdi, Senior Vice President and Head of Business Banking, Dubai Islamic Bank, is calling for the establishment of a sectorwise index for the SMEs. He suggests that the index can be calculated on the basis of the number of SMEs in the relevant industry proportion to the total enterprises. Against this, there

May 2010

is a need to establish the ideal size of establishments within a range and their characteristics, such as labour and capital intensity, he explains. He points out that arriving at a common definition for the SME unit has created further awareness among the banking and financial industry about the critical importance of the SME as a backbone of the UAE economy and the new national plan for the development of the SME sector, which is being prepared by the Ministry of Economy will further facilitate the role of the small and medium businesses in the country’s economic development.

State Bank of India Corporate Banking Services in UAE Trade Finance • Letters of Credit (Issuing /Advising/Confirming) • Trust Receipts • Export & Import Bills (Collection/Negotiation/ Purchase/Discount) • Bank Guarantees • Buyers’ Credit & Suppliers’ Credit Working Capital Finance • Fund Based (Overdraft, Demand Loan etc.) • Non-Fund Based (LCs, BGs etc.)

Term Finance • Project Finance (Green-field & Brown-field projects) along with Advisory Services • Augmentation of Working Capital • Import of Plant & Machinery Syndication • Participation in Syndicated Deals (Primary & Secondary Market) along with arranging and underwriting Deposits • Accept non-Dirham Deposits from Professional Clients in Non-State Markets

DIFC Branch – Regulated by the DFSA P O Box 482033, Level 2, Gate Village 05, DIFC, Dubai, UAE. Tel +971 4 3230203; Fax +971 4 3230204. Email sbidifc@eim.ae • Website www.sbi.ae

State Bank of India’s DIFC Branch is regulated by DFSA. In terms of its license it can offer Non-Dirham credit to any Corporate. Deposits can be sourced in any Non-Dirham currency from Professional Clients in Non-state markets.

C OV ER SME SPECIAL STORY - BANK S

Monetary discipline and support are key Mashreq says government guarantees will greatly help banks in offering credit

ashreq firmly believes that growth of the SME sector provides an important boost to an economy – SME sector constitutes 90 per cent of the financial system in our region. Mashreq has succeeded in becoming a leading name associated with small and medium sized enterprises sector in the UAE through several initiatives and business development activities undertaken to boost this sector, according to Hemant Lalithraj, Head of SME Business. In this respect, he hailed the initiatives of the Mohammed Bin Rashid Establishment for SME Development in promoting the cause of the small and medium businesses. Also, a number of new and active measures are expected to be put in place by the UAE top leadership and government, which will strengthen the Emarati entrepreneurs’ participation in the selfemployed segment, thus help the SME units, he noted. Mashreq works closely with these institutions in formulating

20 BANKING AND BUSINESS REVIEW

Hemant Lalithraj, Head of SME Business

policies and programmes to facilitate the growth of the SME sector, he said. Hemant Lalithraj, who has a passionate association with SME banking in the UAE from its early days, underlined the need for close monitoring

May 2010

of the small and medium business units so that any undesirable tendency is kept out of the system. Hemant is a seasoned banker with expertise in a number of various areas in the banking industry. Hemant cites the cases of irresponsible behavior by owners of small and medium enterprises during the speculative run on the stock market and later during the property boom in the country. “When they found that the stock market was yielding returns in multiples of what they could hope to make from their regular business, these business owners invested all their resources into the

stock market. They even diverted their working capital into stock market investments,” he pointed out. “When the speculative bubble burst in the stock market, they found even a more attractive proposition in the property market, which happened to be riding one of the most unnatural booms in history. And when things suddenly went wrong, many of them found themselves faced with the prospects of ending their business”. Hemant says Mashreq never stopped funding for the SMEs even during the financial crisis, but the bank was lending more prudently, with proper checks and balances in place so that there was no misuse of the fund. “We have always educated our customers to be more responsible borrowers. We ensure to offer tailor-made services as we are partners in the success of our customers” he said. The bank has done a proper segmentation of its SME customers so as to identify the ones that have been better performers and those who ended up losing money in their businesses. This has helped the bank to selectively increase credit lines to healthy businesses and even put further capital into their business. According to him, Mashreq has sophisticated tools to achieve this task and the results are already showing lower delinquency rates and a healthier portfolio of SME business. Hemant said Mashreq encourages customers to avail of ‘self-liquidating’ facilities which do not leave much scope for misuse. “Self-liquidating facilities are not evergreen facilities like overdrafts and this helps customers to

Strategic partnership with government bodies and diversifying product offering plays an important role in attracting more customers exercise greater self-discipline on the monetary front and it also makes their relationship with the bank easier. We also lay emphasis on products like factoring, which is a great help for open account trade,” he said. Hemant says the bank’s SME business is showing significant growth and feels that the SME segment will see more banks entering the fray at a rapid pace. But those who are already present in the business strongly are likely to deploy more resources and capital into the business as the sector as a whole is growing at a remarkable rate. In this regard, Mashreq is already adding to its SME teams. At the same time, he says the optimism has to be laced with caution. With real estate prices coming under a lot of pressure and banks going into foreclosures, there is a great deal of stress expected into the SME space. A lot of measures being taken as corrective action will hurt in the short term but will be

extremely healthy in the long term, he points out. “Going by the experience during and after the crisis, banks need to keep their best customers and keep adding to the number. In the end, what distinguishes a bank from the rest would be its success in diversifying the product offerings, bringing in the best class of products from the rest of the world, providing high end convenience to their customers along with sophisticated delivery channels and service levels,” he says.

BANKING AND BUSINESS REVIEW

May 2010

SME SPECIAL - BANK S

Unified national policy required Common commercial licensing norms and definition together can really help, says ADCB

unified commercial licensing policy for the small and medium enterprises along with a common definition for the units together can provide very powerful support to the SME sector, according to Nilanjan Ray, Senior Vice –President and, Head of SME Banking, Abu Dhabi Commercial Bank. “And we believe the Governments are taking concrete steps towards establishing this unification to help support SMEs,” he said. At this point in time, commercial licensing is done separately by each Emirate. But a unified commercial licensing and unification of definition for the segment can together be very powerful to support the sector, Nilanjan emphasized. According to him, while the recent policy initiatives will be helpful to the SME segment in the long run, currently the impact of the policy initiatives has not been felt across the businesses and one has to see support fro this from all the Emirates. “Support from appropriate authorities would also go a

22 BANKING AND BUSINESS REVIEW

Nilanjan Ray

long way in order to establish the widespread use of the definition in banking

May 2010

industry. For instance, the common definition can be used to support the SME sector with suitable fiscal or monetary measures and to incentivize banks to increase lending to small and medium enterprises”. The Head of ADCB’s SME Banking points out that there has been a distinct preference to cash flow based lending over collateral based lending in the sector. At the same time, there has been an increased focus on designing niche products which cater to specialised clusters within SME sector. There has also been more focus on trade finance facilities, which are essentially self liquidating in nature. Nilanjan notes that there are a number of banks that are now focussing heavily on the SME sector. However, credit appetite across the banking sector has affect-

ed credit flow to SMEs. “At this point in time, we see a definite appetite for good SME credit risk, particularly if supported by cash flows. While increased competition should lead to increased credit flow, sectoral concentration of credit on banks’ lending portfolio may affect this,” he points out. He says ADCB is committed to supporting the SME sector. “We have continually invested in people, new products and processes for this sector over last two years whilst we have seen many of our competitors scaling back. This counter-cyclical approach has been very profitable for us as demonstrated in growth of our SME portfolio. As recognition of our efforts we received an award from Bankers Middle East for our BusinessEdge suite of SME products. As a result of these initiatives, ADCB’s SME business is carving out an ever-increasing share of the business lending book at ADCB”. ADCB offers the entire suite of account services and lending solutions. These include working capital solution,

While the recent policy initiatives will be helpful to the SME segment in the long run, currently the impact of the policy initiatives has not been felt across the businesses

installment finance and equipment finance on the lending side along with complete range of account services. The bank also offers a full suite of trade finance products to the SME sector. Recently ADCB launched a unique lending solution for our current account customer linked to their transaction patterns which allows them an overall enhanced relationship with the bank, he said. According to him, the bank is launching niche lending products to cater to specific clusters of SME customers. “For example, we are in the process of launching a financing product for medical professionals and hos-

pitals to support purchase of healthcare equipment. Similarly we are launching a financing solution for users of industrial imaging and printing equipment. We also have an online Fx platform for SME clients in the pipeline”. Nilanjan said there are several cases where the bank’s funding has helped the SME units achieve outstanding growth and cited Coffee Planet as one of them. “We structured a financing solution for them to meet their equipment financing needs at the early stage of their operation. Coffee Planet is a young and dynamic company and we are happy to see it spread its wings across many locations in the UAE,” he said.

BANKING AND BUSINESS REVIEW

May 2010

SME SPECIAL - BANK S

SMEs go international HSBC Middle East positive about small and medium enterprises growth

mall and medium enterprises are increasingly internationalizing their operations to add and diversify their revenue streams and this new trend is driving local and regional SME banking growth in 2010 to new levels. “There is a two-way internationalization taking place. On the one side, local companies are looking for international opportunities for growth and diversification of their operations as they realize that they need to expand the scope of their businesses to replace reduced revenues in their domestic markets. In the same way, international companies are coming and setting up presences in the region, as it is identified as an increasingly significant global emerging market” says Nicholas Levitt, Regional Head of Business Banking HSBC. According to him, the confidence levels within the SME sector appear to be back to pre-financial crisis levels. He cites the results of an HSBC survey of the regional SMEs, which showed that the Middle East outlook correlates strongly to the global emerging market outlook, and as a major international trading hub, the region is well-placed

24 BANKING AND BUSINESS REVIEW

Nicholas points out. “We have seen substantial liquidity injection, government stimulus and aid, as well as deposit guarantees, all of which will have a positive impact on the SME sector,” he adds. The extent of international business varies greatly from market to market, but overall, the level of SME internationalisation is set to grow by 13 per cent by 2011, the survey showed. Top reasons for doing business internationally are the sales and revenue opportunities as well as access to international markets as SMEs seek to diversify their risk beyond domestic markets. The most preferred international business locations for SMEs in the region are Greater Nicholas Levitt, Regional Head of Business Banking China, South-East Asia and for future growth. Europe. The top barriers for the SMEs In fact, government support for turning to international markets are SMEs is increasing throughout the unstable financial conditions, such as Gulf and not just in the UAE, with fluctuating exchange rates and interest nearly every country highlighting the rates, costs of essential services such as business segment as a priority sector, shipping, logistics and storage as well as

May 2010

government regulations. The UAE is built on cross-border trade conducted by entrepreneurial SMEs and this remains a critical component of the UAE economy, he said. There is a huge potential for the growth of UAE’s trade with emerging markets and HSBC is uniquely placed to finance the expansion plans of the country’s SMEs in this regard, he said. HSBC has launched a $100 million fund for supporting small and medium businesses in the country. The fund, which is part of the bank’s global strategy to support internationally, focused SMEs, and Emirati owned businesses, is specifically targeted at UAE companies with a turnover of $30 million or less to support them in cross-border business. Lending from the fund is meant for SMEs that need working capital finance for international expansion and priority is given to Emirati-owned businesses.

Underscoring the important initiatives taken by the UAE government and institutions like Dubai’s Mohammed Bin Rashid Establishment and Abu Dhabi’s Khalifa Fund for Small and Medium Enterprises, Nicholas pointed out that these measures signify the government’s commitment to promote this vital sector. “Recent action by the UAE government to reduce the cost of setting up and conducting business in the UAE is a clear indicator of its commitment to maintain a business-friendly environment,” he notes. Nicholas welcomed the reported moves on the part of the UAE federal government to launch a number of concrete steps to promote greater transparency in the functioning of the sector, including the proposed federal credit bureau. Asked if the absence of government guarantees is hindering growth of credit flow to the small and medium

business units, he said there are examples of both success and failure on this account. Some countries have explicit government guarantees packaged into their SME support services. “Hong Kong is a great example of how guarantees are helping the SME units to obtain working capital and investment funds that they require from time to time. But in certain other jurisdictions, the credit guarantee becomes counter-productive as the government role adds to a lot of avoidable delay and reduces its application due to an excessive number of qualifying criteria,” he said. HSBC, considered to be a market leader in the UAE SME banking sector, offers overdraft, trade finance and guarantees as part of the working capital finance facilities and short and medium term loans to meet capital expenditure. These are in addition to a full complement of banking services, including private banking, wealth management and insurance.

BANKING AND BUSINESS REVIEW

May 2010

Survey shows business confidence high Business confidence among the Middle East’s small and medium-sized enterprises (SMEs) is high according to a survey conducted in Q409 by TNS for HSBC. Qatar, Saudi Arabia and Egypt in the Middle East were included in the survey. Across the region, a growing proportion of small businesses are optimistic for their prospects in 2010 signaling increasing capital investment and recruitment. Qatar business confidence was the highest at 159 points followed by Saudi Arabia at 125 points and Egypt at 110 points. Globally, the SME indices tracked by HSBC in most countries and territories hold a positive outlook, with the Middle East at 125, Latin America at 118, the US

26 BANKING AND BUSINESS REVIEW

May 2010

and Canada at 107 and the UK at 101. France is just below neutral at 94. But emerging markets in Asia, the Middle East, Latin America and Eastern Europe are significantly more optimistic than the developed markets of the US, Canada, the UK and France, with an average index of 121 versus 106. The semi-annual HSBC Small Business Confidence Monitor gauges the six-month outlook of SMEs on local economic growth, capital investment plans and recruitment. This was the first time that Middle East countries were included in the list of 20 markets, capturing the views of more than 6,000 SMEs in Asia, the Middle East, Europe, North America and Latin America – the largest international survey of its kind. The results were used to calculate an index ranging from 0 to 200 where 200 represents the highest confidence level, 0 represents the lowest, and 100, neutral. The survey was conducted in October and November 2009 by research agency TNS. The survey showed that 47 per cent of the region’s SMEs expect local GDP growth to increase over the next six months. 36 per cent expect the pace to remain the same, and only 17 per cent expect growth to slow. The survey found Middle East region to be the second most confident region, after India when it came to investing in their own businesses in the first half of this year, with 47 per cent planning to increase their capital expenditures, 41 per cent saying they will maintain current levels and only 11 per cent are planning reductions.

Outlook on recruitment plans Recruitment sentiment in the Middle East is strongest globally. 36 cent of the regionâ&#x20AC;&#x2122;s SMEs say they will increase staff in the next six months and 58 per cent saying they will keep staff levels the same. Recruitment is generally stable across the 20 markets in the survey. The HSBC Small Business Confidence Monitor also asked SMEs about the extent of their crossborder trade and other international business, such as overseas operations. Across all markets, 3 in 10 SMEs surveyed say they have some level of cross-border trade or international business. In Qatar, the number is nearly 7 in 10. In Qatar 69 percent of SMEs surveyed were involved in international business, in Saudi Arabia it was 27 per cent and in Egypt 33 per cent. When SMEs were asked if they plan to engage in international business in the next two years, 72 per cent of Qatar SMEs planned to grow their international business. In Egypt it was 28 per cent and in Saudi Arabia 19 percent. Top reasons for doing business internationally are the sales and revenue opportunities as well as access to international markets as SMEs seek to diversify their risk beyond

domestic markets. Top international business locations for the region are Greater China, South-East Asia and Europe.

BANKING AND BUSINESS REVIEW

May 2010

SME SPECIAL - BANK S

Opportunities abound for SMEs Citibank’s Small & Mid Market Enterprises business will be the growth engine for the next few years

t must be made mandatory for all banks to participate in the Credit Bureau, Citibank spokesmen told BBR in response to a question on the issues that needed to be addressed to enhance credit flow to the SME sector. Such a move will strengthen the overall financial services industry, they pointed out. Even before we went to the press with the bank’s response came the announcement from the Media Office of the Dubai Ruler’s Court that HH Sheikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE, in his capacity as Ruler of Dubai, has issued a decree designating Emirates Credit Information Company (Emcredit) as the official credit information agency of Dubai and making it mandatory for all Dubai-based banks and financial institutions to join its database. The development shows how keenly are the authorities tuned in to suggestions from the banking industry for improving the conditions for the growth of credit flow to the small and

28 BANKING AND BUSINESS REVIEW

medium business sector. “Access to reliable financial statements is a concern not just for Citi but all banks. There should be mandatory filing of financial statements for companies and this could be started with companies where lending is more than Dh250,000. This data is any way reported by banks to Central Bank and this will help banks make better risk decisions,” said Sanjoy Sen, Consumer Bank Head – Middle East. “There is a dearth of data on the commercial sector overall - if an independent body can provide credible information, banks will be well positioned to cater to their requirements,” he said. Asked about how the moves to redefine the small and medium enterprise have helped in creating favourable conditions for the SME units, Satyajeet Roy, Local Commercial Bank Head, said Citi globally has a well-defined SME and MME (Mid-market enterprises) target market definition. “The SME definition falls broadly within the recent announcement and we believe

May 2010

that this initiative will definitely help the banking community to address the needs of SME’s in a structured way”. According to Citibank, the post-financial crisis environment has seen the bank adopt a cautious approach to the SME/MME businesses and the lend-

Sanjoy Sen

ing business overall. “ Increasingly, we are witnessing banks offering lending

facilities linked to clients ‘trade-cycle’ rather than facilities where there was limited end-use monitoring,” Satyajeet Roy said. Citibank believes that with competition within the segment increasing, finances have become more accessible to small and medium units. But at the same time, given that all banks are operating in the same playing field (governed to some extent by the common external environment), lending across both retail and commercial bank space has been cautious. “However, Citi is looking at innovative lending solutions for companies by mitigating risk through a combination of factors including credit insurance”. Citi’s commercial banking unit offers a comprehensive range of cash management, lending, trade and treasury products for SME’s. This offering is on the strong foundation of a best-inclass service with each client managed by a dedicated Relationship Manager. Specifically for MME’s, the awardwinning internet banking platform (CitiDirect), the cash management/ treasury solutions available coupled with the global network makes Citi a natural choice for entities with businesses in multiple geographies, the bank said. Citi recently introduced Investment & Insurance solutions for companies – bringing its on-shore and off-shore Wealth Management expertise and global product range to its commercial clients. Despite the events of the last 18 months or so, the bank’s commercial banking arm posted higher revenues in 2009 vs. 2008 and is slated to contribute 20 per cent to the bank’s bottom line in UAE, Citi said. Citibank says it is committed to the Small &Mid-market Enterprises segment in the Middle East Region with specific focus in UAE and Bahrain where this business has shown substantial growth in the last 4 years. According to the bank, this forms a part of the

There is a dearth of data on the commercial sector overall - if an independent body can provide credible information, banks will be well positioned to cater to their requirements

Satyajeet Roy

Local Commercial Bank business under the umbrella of Consumer Bank where the bank enjoys an eminent position on the foundation of a dominant Cards and Wealth Management business. The bank says its SME and MME proposition is clearly articulated in terms of client needs. The SME segment looks at entities up to $50million

annual turnover with a full suite of cash management and lending products with a strong service delivery support. The MME segment caters to large local and global entities with a $50-250 million annual turnover that require Citi’s geographical spread and connectivity through its transaction services, Trade and Forex platforms. “We continue to view the UAE as a regional hub serving the Gulf and Levant region, not to mention the local market, which is fast expanding and becoming more sophisticated. We realize that the Small & Mid Market segment is one of the most under-served segments; therefore, and in line with our stated objective, it was only natural to add the Cheque/Bill Discounting & Trade Finance products. Apart from the introduction of these products, we also offer ‘value-added’ benefits like an online platform for salary payments through the Wage Protection System, mandated by the Ministry of Labour. Such bundled offering will help build stronger partnerships with our clients,” Roy added.

BANKING AND BUSINESS REVIEW

May 2010

SME SPECIAL - BANK S

Risk-reward balance crucial There are roadblocks to affordable credit for small and medium businesses, says StanChart

he biggest challenge for the SME banking sector in the UAE is to strike a balance between risk and reward in order to achieve a situation that is mutually beneficial to the banks as well as small and medium businesses, says Rajesh Gupta, Acting Head of SME Banking, Standard Chartered UAE. Banks have been extremely cautious in their approach to SME banking. While the SME segment provides opportunities for banks to earn higher margins as compared to traditional corporate banking, it also poses potentially greater credit risk due to lack of credible credit information and quality of financials for SMEs. In such a scenario, while some banks have scaled back SME lending, others have looked to mitigate risks arising out of the given challenges. “SMEs today are struggling to get the right kind of financial support from the banking industry. The major challenge is to get affordable financing with low collateral requirement, which is different to banks’ motives to provide low risk financing at better spread. The challenge in this scenario is to strike a balance between risk and reward in order to achieve a mutually beneficial situation,” Rajesh told BBR. It has been challenging for the SMEs to obtain finance since the global recession has resulted in tighter liquidity and lower credit appetite, he pointed

30 BANKING AND BUSINESS REVIEW

Rajesh Gupta

out. SMEs have faced pressure on their working capital lines due to piling up of inventories and the slow recovery of trade receivables. There has been a

double-negative effect for SMEs with the decrease in bank credit. Rajesh Gupta is responsible for the overall strategy and governance of Standard Chartered’s SME business. His unit develops structured solutions to further build on Standard Chartered’s strong SME market presence and increase market share. Having returned to Standard Chartered in the UAE in 2006, Rajesh currently oversees a team of more than 100 employees in addition to a third party sales force of more than 200. He has significantly contributed to the growth of SME Banking unit as a market leader in the UAE and continues to build its profile externally.

Anything that the Government can do to improve the banks’ ability to make sound credit decisions would be helpful in increasing the appetite for SME risk May 2010

Prior to moving to the UAE, Rajesh worked for ABN AMRO in a number of other counties in Europe, Middle East and Asia and has vast experience in the corporate, wholesale banking and transaction banking businesses in various country, regional and head-office roles. In the absence of a central register for creating charge over moveable/fixed assets of companies, banks are not able to create an effective charge over the assets financed, he points out. “Risk of double financing of the same asset is high. Most banks do not consider assets as realisable collateral due to this reason, creating a roadblock for affordable, low risk assets”. “Anything that the Government can do to improve our ability to make sound credit decisions would be helpful in increasing the appetite for SME risk - transparent reporting, robust bankruptcy, legislations, perfection of collateral and most importantly, a positive credit bureau. Rajesh welcomed the government initiatives for credit guarantees, but noted that these proposed schemes as reported are significantly lagging best practice in that first-loss protection is very low. “Internationally, Hong Kong and Singapore offer 100 per cent payment guarantee to banks. We would have been keen to support expanded Private –Public Partnership for funding SMEs, as we do in Hong Kong and Singapore, but only if the risk-mitigation was higher. The Khalifa Fund (Abu Dhabi) and MBRE (Dubai) have done some good work in this regard and we continue to work closely with them,” he said. Referring to the difficulties for SME units to access start-up capital, he pointed out that, given the transient nature of the market, most banks will only lend after three years of establishment. “This makes it very hard for small and medium businesses to access start up capital. The government can help enormously here by being more aggressive on credit guarantees or by creating

In the absence of a central register for creating charge over the assets of companies, banks are not able to create an effective charge over the assets financed greater access to start up capital that currently is the case,” Rajesh said. Asked about the moves for a unified definition for the SME units, he said so far this has not resulted in a significant change for the SME industry. The primary reason for this is that although there is a common definition, no supporting policy measures have been announced. Banks continue to use internal definitions for their SME businesses, which do not necessarily align with the common one. “Policy makers have created better awareness of the contribution of SMEs to the country’s economy. They also provide critical data which helps bankers develop their SME strategies. But he said a common definition at the federal level will further add impetus to the importance of SMEs to the economy. “Policy measures supporting SMEs will encourage banks to adopt a single definition and work in the same direction. This is key to the greater development of an important economic sector which still remains at its early stages in the region,” he said. Rajesh says Standard Chartered continued to support its customers despite the liquidity crunch. The bank has focused on deepening relationships with its SME customers by providing trade and working capital solutions, he said. “At Standard Chartered, we are committed to our customers and have remained open for business. The bank continued to hire and is expanding its Relationship Manager (RM) capacity. We have continued to lend and have not withdrawn credit lines from our customers - this has helped us achieve market share during difficult times”. According to Rajesh, Standard Chartered is one of the leading SME banks

in UAE as well as the region and looking to increase customer base by 10-12 per cent year on Standard Chartered’s SME business was launched in Oman, Bahrain and Qatar in 2009, since then the segment has expanded significantly, he said. The bank provides a full suite of financial solutions for our customers, including§ trade & working capital finance, cash management, treasury and forex services, small business loans, international trade services and so on. “In addition to credit growth, we have also been helping customers hedge their foreign exchange risks by conducting seminars on trade and treasury services to educate them on the risks involved in international trading. This has helped our customers to mitigate these risks and expand their international businesses. Due to poor equities environment and lack of trust in various asset classes, we have also been working on providing low risk and high yield deposit products for our SME customers,” Rajesh said. Rajesh points out that the bank has increased its resource capabilities to provide financial solutions to customers according to their needs, rather than selling off the shelf products. In line with the policy of providing services to customers closer to their work place, the bank has relocated its branches in Jebel Ali Free Zone and Deira to bigger premises, he said. Rajesh points out that the bank has a large base of successful SMEs which have grown over the years. “As a banker, it is satisfying to see customers grow from small businesses to become renowned names, adding value to the economy and generating employment at a large scale,” he adds.

BANKING AND BUSINESS REVIEW

May 2010

SME SPECIAL - BANK S

SME index a useful tool Move for national plan to develop sector signifies growing importance, says DIB

ubai Islamic Bank has called for a sector-wise SME index to strengthen the growth of the small and medium businesses. The index The SME index can be calculated as the number of SMEs in a particular industry as a proportion to the total number of enterprises, says Mohammed Ahmed Wajdi, SVP- Head Of Business Banking, Dubai Islamic Bank. According to him, there is a need to establish the ideal size of establishments within a range and their characteristics such as labour and capital intensity. The index could also be based on different Mohammed agrees that arriving at a common definition for the SME unit has helped create further awareness among the banking and financial institutions about the critical importance of the SME as the backbone of the UAE economy. There are 260,000 companies in the UAE and 208,000 of them are SMEs, roughly accounting for 80 per cent of the economy, he said quoting sources.

32 BANKING AND BUSINESS REVIEW

Mohammed Ahmed Wajdi

There is a need to establish the ideal size of establishments within a range and their characteristics such as labour and capital intensity May 2010

The Federal Government move to drawing up a national plan to prompt the small and medium business sector is indicative of the bigger role that the SME sector has been assigned, he pointed out. The Ministry of Economy has been given the mandate by the UAE Cabinet to develop this plan and the ministry is now working on a draft law for the sector, he pointed out. The UAE has been ranked among the top 5 from 84 countries in terms of support to SMEs. Others in the top list are Bahrain, France, Singapore and Hong Kong. Like his peers in the business, Mohammed feels that despite the global financial crisis, banks remain cautiously optimistic about lending to the SMEs. In a year’s time, banks are expected to provide comprehensive solution to the SMEs, a segment which is currently underserved but growing at the fastest rate, he said. Although a well-developed SMEs sector can make significant contributions to macro-economic stability and growth, the small and medium businesses are relatively of high risk and with the financial crisis shaking the pillars of the corporate sector, SMEs were heavily exposed to risk and they faced increasing barriers to capital access, Mohammed said. “On the one hand, this impedes their ability to obtain funding, and on the other, they are forced to pay higher interest” he said. Also, in times of financial crisis, the markets perform poorly, with the result that the entry of new firms becomes more limited, further compounding the problems of

Although a well-developed SMEs sector can make significant contributions to macroeconomic stability and growth, the small and medium businesses are relatively of high risk

the small and medium enterprises,” he pointed out. SMEs are a focused segment and require backing of both resources and strategy. Though quite number of banks offer products suited for the SME segment, the offerings are not yet providing a competing edge, he said and pointed out that the importance given to the SMEs within any bank depends more on the overall strategy and its risk appetite. Financing is selectively considered, however, as stipulated by the banking regulatory policies on lending SMEs based on certain criteria. Mohammed said DIB is among the banks that have a dedicated team to cater to this sector. “Initially we had a conservative approach, which meant longer time to understand this segment in terms of profitability and risks associated with it”. But he said the bank now constantly seeks to provide innovative Shariah-compliant products and solutions required to meet the needs of the SME customers. DIB offers an array of customized products for the SME sector, such as working capital finance, capital expenditure finance, contracting finance, fleet finance, treasury and trade serv-

ices, including letters of credit and guarantees. Under the Small Business Finance category, the bank offers up to Dh500,000 for wholesalers, retailers, manufacturers etc. Similarly, as part of the package providing flexibility in managing the daily business requirements of small and medium businesses, DIB also offers cash management services, such as Collection/ Deposit, E-Reporting, E-Payment and E-Trade. The Al Islami Business Accounts are designed to help businesses grow by efficiently taking care of their business transaction needs and this product comes in three packages such as Al Islami Business Account, Al Islami Business Account Plus and Al Islami Business Account Premium. Each account package offers a unique combination of benefits, Mohammed pointed out. Apart from these, DIB has recently introduced the ‘early bird’ approach in the SME business, which has been categorized as a focused segment, where there are teams supporting various target segments of industries. These teams have the dual functions of asset and liability book management as well as cross-selling of the bank’s products, he said.

BANKING AND BUSINESS REVIEW

May 2010

SME SPECIAL - BANK S

SMEs need handholding to tide over crisis

Bank of Baroda has always supported small and medium businesses, says CEO

he working capital requirement of SME borrowers has increased due to slowdown in the market while their business volumes have gone down, necessitating handholding facilities for them to tide over the crisis, according to Ashok Gupta, Chief Executive, Bank of Baroda, UAE. “The SME sector is one of the most adversely affected by the financial crisis. The working capital requirement of SME borrowers has increased due to delay in sales realization owing to slow down in the market. This has resulted in an increase in demand for working capital finance from SME borrowers. On the other hand, their business volumes have gone down and what they need are proper hand holding facilities to tide them over the crisis. This is being effectively done at Bank of Baroda as there is flexibility within the broader framework,” Ashok Gupta said. The post-financial crisis situation has also increased the need for better monitoring of credit portfolio by the banks to avoid deterioration in the health of credit folio, he pointed out. Gupta said policy initiatives such as arriving at a common definition for the SME unit will ensure proper identification of SMEs and facilitate easy credit flow to the SMEs. In late 2009, the Dubai Government set a general definition for SMEs, which is differentiated by sector and takes both turnover and workforce size into account. The Dubai Chamber of Commerce considers companies with less than 10 employees micro, those

34 BANKING AND BUSINESS REVIEW

Ashok Gupta

with less than 20 or 24 small and those with less than 100 medium-size, provided turnover is less than Dh100 million, he pointed out. The UAE banks usually consider companies small if their turnover is below $10 million a year and medium-size if it is under $25 million, but for Bank of Baroda, companies with an annual turnover of Dh100 million are classified as SME borrowers, he said. Ashok Gupta said Bank of Baroda has always been active in supporting and financing SMEs. The fact that other banks have also started looking at this segment is a healthy sign as SMEs will have more access to funds at more competitive rates, he said. This will help them to grow faster. “Bank of Baroda is offering financing as well as

other services to SMEs at very competitive rates,” he said. He said that the bank is continuously introducing new products and services for SMEs to suit their requirements. “SME units certainly will have the feeling of working with the right banking partner, once they are in the company of Bank of Baroda,” he said. With a view to providing the SMEs specialized services, Bank of Baroda recently established a specialized outfit named SME Loan Factory. This outfit works exactly on the principles of assembly line in the factory, where there is a fixed time limit to carry out each and every activity. All the credit decisions are taken in a time bound manner, he said. Apart from providing regular requirements such as Working Capital limits, Term Loans, Demand Loans etc, SME Loan Factory also offers innovative products, keeping in view the specific requirements of SMEs such as: line of credit, equipment finance, traders loan, overdraft against property for business purposes, project finance and express foan for traders, professionals and business units.

With a view to providing the SMEs specialized services, Bank of Baroda recently established a specialized outfit named SME Loan Factory May 2010

SME SPECIAL - BANK S

Refinancing for lenders a big help SBI says it continued lending to SMEs even during peak recession

nstitutional arrangements to refinance will greatly strengthen the hands of lenders to the small and medium businesses, according to AJ Vidyasagar, Chief Executive Officer of State Bank of India (SBI) at DIFC. â&#x20AC;&#x153;In India we have institutions like SIDBI, which among other things provides refinancing facilities to institutions. A similar arrangement here could further strengthen the hands of the lenders who are willing to lend to this segment,â&#x20AC;? Vidyasagar said. The UAE is home to a large number of SME units, which have played a significant part in the growth of the country and so it is gratifying to note that the Government has refocused on this segment and taken a lot of initiatives in further strengthening this activity, he pointed out. With the recession gradually coming to an

36 BANKING AND BUSINESS REVIEW

AJ Vidyasagar

May 2010

end, financial institutions too would adopt a more liberal approach to lending, he said. Vidyasagar pointed out that when it comes to lenders based at the DIFC, there is a constraint that no charge can be created on the immovable assets of the units. A change to the law putting the DIFC entities on the same level as the entities regulated by Central Bank of UAE for this purpose would further enhance credit to this segment, he suggested. The Indian bank CEO pointed out that the bank started op-

erations during the period of recession when most banks were not willing to lend to this segment. “However, we adopted a positive attitude and provided substantial credit to several SME units,” he said. SBI has started its Corporate Banking Services only last year and hence is in the process of garnering a part of the market share, he said. “Our approach to SME business is characterised by positive attitude, transparent dealings, competitive interest rates, personalized and courteous service and need-based financing. In due course of time, we are planning to have dedicated personnel to cater exclusively to this segment,” Vidyasagar said. In India, SBI has been a pioneer in SME financing and all along provided focused credit to this segment. There is a separate business group to focus exclusively on this segment. Exclusive Loan processing centre, exclusive branches, exclusive schemes and specialized products and personnel contribute to the tremendous importance SBI provides to the segment. “From DIFC branch, we have continued the tradition of SBI and provided substantial credit to this segment. About 60 per cent of the total credit of our branch is provided to units in the segment,” he said. Vidyasagar pointed out that SMEs are generally considered to be in the higher risk category. Hence post the financial crisis, financial institutions

“Our approach to SME business is characterised by positive attitude, transparent dealings, competitive interest rates, personalized and courteous service and need-based financing”

would be more careful in lending to this segment. While there would be no drying up of finance, financial institutions would lay greater emphasis on the security aspect and focus more on sound financials of the company, he said. The leading Indian banker noted that there is increasing competition among the various banks to cater to this segment. Competition would obviously provide greater accessibility to finance and also enables availability of credit at cheaper rates. Referring to the government initiatives to strengthen the SME sector, he said a common definition for SME is the first step towards focusing on the segment. This would enable all concerned to arrive at the exact exposure by various financial institutions on the SME segment for the time being as well as on an ongoing basis. It would provide the tool for the authorities to monitor the exposure at regular inter-

vals, he said. “In short it would provide the SME segment a distinct place in the scheme of things,” he pointed out. SBI offers the whole gamut of products required by SME units for their operations, Vidyasagar said. These include trade finance facilities like issuing, advising, confirmation and negotiation of LCS and also Trust Receipts. SBI also issues bank guarantees, apart from collection and negotiation of all types of bills and provision of financing at both ends of the trade transaction by sanctioning suppliers credit as well as buyers credit. The bank offers the full range of working capital credit facilities whether they are fund-based or non-fund based, he said. It also provides term loans also for setting up plant and machinery, project expansion, import of capital goods etc. The bank even offers syndicated services wherever the ticket size is big, he added.

BANKING AND BUSINESS REVIEW

May 2010

C OV ER SME SPECIAL STORY - C OMPANIES

European heritage adapted to Middle East At Baker & Spice, they not only know and love the food, they know how to grow it as well

uropean heritage, adapted to the Middle East to create a unique version of local soul food. That’s how Baker & Spice describe themselves. “We know and love our food”. At Baker & Spice, they not only know and love the food; they also know how to grow the food, cook it and of course serve. The menu represents an exciting daily journey through the farms and markets of the UAE and the region, constantly changing with the seasons and availability of fresh locally grown and mainly organic ingredients. What diners get there is an ‘experience with food in its purest and freshest form’. Baker & Spice started as a concept in London in 1995 by Yael Mejia. It was set up as an artisan food shop making everything in their kitchens. The London’s iconic food shop has been brought to the UAE by Kharafi Global, a Kuwait-based F&B company owned by Kuwaiti nationals Waleed Al Kharafi and Haidar Al Naqeeb. The B&S spirit arrived in the emirates when Baker & Spice Dubai opened in January 2009. Located in the Souk Al Bahar, it is a large dining and retail space, including a terrace overlooking the Dubai Fountain at the base of the Burj Khalifa. The restaurant can seat 150 diners and offers a breakfast, lunch, dinner and retail menu.

38 BANKING AND BUSINESS REVIEW

“Mashreq has been with us from the first step of entering the Dubai market and we are extremely pleased with this partnership” “I have to say it’s very challenging and at the same time encouraging to see what exactly can B&S add to the market here. The food industry is massive here with international brands that have been around for a very long time. But we believe that B&S with its unique combination in its offering can add so much to the diversity in the market here, build a reputation for its own and stand out,” says Mohamad El Chehimi, Dubai General Manager . “Baker & Spice is considered one of the best restaurants serving fresh and quality food in town. The concept theory is unique; hence it’s difficult to locate a restaurant business with similar standards. The first priority is to look at what is in season locally and within the region, and in peak condition. Sourcing food this way means that we are minimizing our food miles and carbon footprint, and the journey from field to plate is significantly shorter,” he points out. Mohammed says that the aim is to establish a strong food retail brand in Dubai, before taking it across the Mid-

May 2010

dle East. The market is big and full of promising opportunities and our line of business is booming. “Once we are done with Dubai expansion, we will further expand in the region”. “We are planning to open our central kitchen and at least two more units. Our expansion plans are huge in this market and we look forward to grow further and further,” he said. But the priority for the time being is to establish a strong brand presence in Dubai and expand in the region. “We look forward to tap in various markets, when the opportunity arises”. Asked about the brand’s experience with their bankers, the general manager said they are “pleased with the level of service and products offered by Mashreq. This greatly assists in streamlining our business, hence its growth. Mashreq has been with us from the first step of entering the Dubai market and we are extremely pleased with this partnership. I am certain that Mashreq’s continuous support will result in further growth and success of B&S,” he said.

SME SPECIAL - C OMPANIES

Benefiting from oil boom Dubai firm comes a long way from modest origin

tarting with a 12-sqft shop, doing repair of motor vehicles in 1973, the ESMA group today is a prominent player in the business of supplying and servicing various industrial and engineering products for the oil and gas industry, marine onshore and offshore, process industries and the petrochemical sector. The company was founded by Narenda (Nari) Odhrani and his brother. Odhrani came to Dubai after completing training as mechanical engineer to pursue a career in maintenance and repair of vehicles. In those days, 4-wheel drives were the main mode of commuting between oil installations and the rest of the country, so the business did make sense. But according to Yogesh Odhrani, the son who joined the business in 2002, within one year, the repair business got stuck in a rough patch and it was around this time that the oil boom was happening. So, the Odhrani brothers sensed a great opportunity there and plunged into the oil fields supply business. That proved to be the all-important break. The main activity of the new venture was trading of goods, buying llocally from regional companies and selling to major American companies that were involved in the drilling of oil wells all over the country “Soon after, we established relationships directly with manufacturers who

ESMA, which banks with HSBC, is constantly adding new dimensions to the business were looking to partner with companies that excelled with knowledge about the oil and gas industry,” recalls Yogesh. Within two years, the operations shifted to a premises five times larger and an even larger stocking location was hired for holding the inventory. As the business further grew, the location was again shifted to a facility three times higher and incorporated a warehouse, workshop and offices. By the early eighties, the operations expanded to Abu Dhabi, with the addition of several other locations. “We kept reinvesting back into our business and initiated direct imports from the manufacturers and building inventory of the products. Our first customer, Weatherford, an American company involved in drilling oil wells, encouraged us to develop our business to provide services on site rather than continuing with trading. Working with Weatherford and several other local and international companies, e.g. ADNOC, Dowell Schlumberger etc was an enjoyable experience,” he said. Initially the business was established in Dubai followed by expansion towards Abu Dhabi in 1981 and the ad-

dition of several locations to the business. In 1995, the company moved its headquarters to Dubai’s Al Quoz area and in 2001, the first overseas branch was established in Azerbaijan, which was followed by another expansion of the Abu Dhabi operations into a facility four times larger. Three years later, the company opened its second overseas branch in Kazakhstan and moved the corporate office to Jebel Ali Free Zone. Also added was a new location in Deira. According to Yogesh, the business has gained reputation thanks to the support from its loyal customers all over the region. “With excellent customers and the growing number of professionals in this industry, our company has achieved a leading position in our industry, and this has received great appreciation from out clients.” Yogesh says ESMA, which banks with HSBC, is constantly adding new dimensions to the business. “We are considering several options for expansion, one of which is the establishment of a manufacturing company for Systems & Equipment related to the oil and gas industry,” he disclosed.

BANKING AND BUSINESS REVIEW

May 2010

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C OV ER SME SPECIAL STORY - C OMPANIES

Dominant player in IT, network security

ubai-based Spectrum Group has grown into one of the leading IT Network and Security training centres in the region offering SMB and large enterprises with training, consultancy and infrastructure support to make best use of technology. Spectrum Group is a dominant player in the IT & network security space – and given the level of specialisation required for the work and the sensitivity involved working with various clients (including Govt investigative agencies), there are only a few names offering such solutions in the UAE today. The group says its USP is clearly the ability to deliver solutions for the most complex issue through a high-performing team. The group won the Your Business SME Award for Best Use of Technology, for 2008. The group was founded by Ajay Singh Chauhan, an alumnus of one of India’s leading engineering institute IIT, Mumbai, who worked with a leading IT company in the Middle East”. Having gained experience and expertise over a number of years, he saw that the region had tremendous potential for specialised businesses and decided to become an entrepreneur. The group started as a training and technology solution provider in 2004 and today has four companies under it. The group provides training to organizations such as Microsoft, Juniper, Guidance software etc. Spectrum has partnerships with Juniper Networks & Foundry Networks as their authorized education partners and has a state-ofthe-art Lab facility in a new premise of the Knowledge Village. It was very challenging to establish credibility quickly and to make

40 BANKING AND BUSINESS REVIEW

Ajay Singh Chauhan

“It would be only fair to say that a part of growth of the Group can be attributed to Citibank’s help” prospective clients (and banks) believe that the company could deliver even the most complex IT security issue, says Chauhan. But he says he was lucky: having hired a set of highly competent and committed individuals, the group has grown consistently over the past 5 years. Over the last 5 years, the group has had a CAGR of 35 per cent. The growth has continued despite the global financial crisis and the group is confident of maintaining the growth trajectory for next 24-36 months. According to Chauhan, the group is looking at Asia and India in particular for expansion. Similarly, it sees scope for expansion into the Middle East through the UAE operations. The nature of the services provided does not need a brick-and-mortar presence for

May 2010

expansion, he points out. “Organic expansion is the way forward. We could look at some JVs in the Middle East. The vision is to clearly add value for the customers and thereby to the group,” he said. Asked about how his bank helped the company grow, he said the natural fallback was to go to Citibank where a personal account existed for the past so many years. “The bank’s commercial banking arm was quick to move and offered something initially, which was not completely as per requirement but sufficient to make a start. Since then, the relationship has strengthened and facilities have grown as well. It would be only fair to say that a part of growth of the Group can be attributed to Citibank’s help,” Chauhan said.

SME SPECIAL - C OMPANIES

Safe and low-cost healthcare ‘Relationship with bank based on credible Trust’

awit Gebreegziabher, founder of Medica Pharma Enterpises, has always been fascinated by the power of medicine in prevention of diseases. He has been in the UAE for the past two decades. Coming from Ethiopia, a country which aspires for improved Human Development Indicators, he works with Ministry of Health in Ethiopia as part of the ministry’s initiative to provide safe and low-cost healthcare services for the people. Gebreegziabher was keen to give something back to society and do something for the people of Ethiopia. The origin of Medica Pharma Enterprises can be traced to this thought. The company has since established itself as a leading supplier to the Ministry of Health in Ethiopia. Having had longlasting successful relationships with leading suppliers around the world, the company is now looking at geographic expansion within Africa. The company has been growing at a rate of 50 per cent year-on-year for the last few years. “Even in 2009, when there was serious recession all around, our business grew at the same pace. The trend is expected to continue well into the next decade,” says Gebreegziabher, who is immensely pleased with the achievements of his small venture.

Dawit Gebreegziabher

He attributes the success of the company to its unique business model. “The company chose to do business in areas which offered huge latent opportunity. The competitive landscape is very different to what you see in the Middle

East or for that matter in any other developed market. The opportunity in healthcare is unlimited,” he explains. According to Gebreegziabher, the company is looking at two more countries in Africa where it wants to explore similar business opportunities. However, this is at an early stage yet, he says. The Medica Pharma founder says Citibank understands the company’s need in terms of the specific requirement for Trade Finance facilities. Citibank’s global profile has ensured that the company is able to seamlessly link the various points involved for such trade transactions end-to-end, he said. “Our relationship with the bank is based on credible trust, mutual respect and enthusiasm. Also, I would like to specifically mention the roundthe-clock service that the company has received from Citibank staff,” Gebreegziabher said.

The Medica Pharma Enterprises founder says Citibank understands the company’s need in terms of the specific requirements

BANKING AND BUSINESS REVIEW

May 2010

SME SPECIAL - C OMPANIES

A well-brewed success

eliver exceptional coffee in every cup…from cart to kiosk to café…again and again and again: this is what Coffee Planet founder Richard Jones set out to do about five years ago. Today, his company sells 10,000 cups of coffee every day through its outlets and has extended its presence into the hotel, office, foodservice and catering sectors. With a turnover of Dh25 million, which is projected to increase to 45 million in the next couple of years, Coffee Planet is today the most widely distributed coffee brand in the UAE. And ADCB, which financed much of this growth, can take pride in helping Richard Jones create a great success story. Before he came to the UAE, Richard was a founding member of a healthcare start up business, Ludlow Street Healthcare Group, in the UK in 2004 which currently has 700 employees. According to his bio, he worked in some of the world’s leading blue chip companies such as Mars, Danone and Price Waterhouse and has a wealth of knowledge and experience gained from his 15 years of financial, marketing and commercial corporate roles. Richard explains the idea behind Coffee Planet: “We had a sense that coffee drinkers deserved better than they were getting and that as we were not constrained in our thinking, we could bring something new to the market by only using the best Arabica coffee beans and the most advanced technology. The UAE with its ambitions and growth potential was a perfect match for our coffee idea.” He says the beginning was very difficult as Coffee Planet was a new concept. “A gourmet fresh bean, fresh milk coffee in a convenience store environment on petrol forecourts had never been done in Middle East and nobody gave us much chance to succeed. But we knew that once people tried our coffee, they would love it. All we had to do was make it available in as many locations as we could for our

42 BANKING AND BUSINESS REVIEW

Richard Jones

limited investment. We had limited private funds to start the business and had to run trials for 6 months to prove the model. It took three years to get any third party funding for our business”. “Coffee Planet operates in many market segments in order that the consumer can drink our coffee at any time of the day in any place where they are. We remain the most innovative and best quality coffee provider in the Middle East and our awareness among consumers is growing rapidly. We are the most geographically widespread coffee brand in the UAE as we are available in every corner of the country. We are starting to open up cafes in traditional locations like shopping malls and office towers but with a very unique interior design feel – we call it a ‘coffee bar’. It is a coffee shop revolution!” claims Richard. Two years ago, the company built its own roastery facility in the UAE, which according to Richards, was ‘to guarantee the freshness of our coffee for all our customers’. Today, it is the largest roaster of specialty coffee in the Middle East. The company says it is continuously seeking new market channels and has a development plan for retail; cafes in Dubai and

May 2010

Abu Dhabi for the next 5 years. “We have taken more control over our supply chain and reduced our cost base by linking up directly with coffee growers in different regions of the world to supply us with the green coffee beans for us to roast. We are also developing cashless vending options for office and residential tower locations,” he says. “We believe the Coffee Planet brand has great potential for expansion into the rest of the Middle East and Asia. We have always emphasised that we are proud this is a brand that was born in the UAE and can be exported to others countries in the region. Consumers know it well and trust it to deliver a great coffee all of the time. So, provided we find the right partners and the right levels of investment and funding we have a great chance to grow our sales and brand awareness abroad,” Richard asserts. The company already has a franchise business, although it is in the early stages. Coffee Planet now operates in Oman and is currently running trials in Malaysia, Pakistan, Jordan and Syria. “We are even investigating a joint venture in the USA. We believe choosing the right partner is critical for success in new markets and so to become a member of the Coffee Planet family takes the right attitude as well as money and desire for success. The response in Oman has been fantastic and we expect the roll out to continue into more convenience store locations and a cafe site in the next 6 months,” he says. Richard says ADCB responded to the company’s request for banking and finance facilities nearly two years ago and since then the two sides have developed a very good relationship. “It is important that a banking partner understands and has faith in the business and that it provides all the necessary facilities to allow the business to flourish. We believe ADCB is such a bank. By being responsive to our needs, by providing solutions that work for us at a cost we can afford, the ADCB bank is helping to project our business forward,” he said.

SME SPECIAL - C OMPANIES

‘Bank understands our vision’ In its own field, the company is at the forefront, says Polimar MD

“R

elationships with banks are like children, once they are born you must nurture them,” says Ara Pierre Keusseyan, Managing Director, Polimar Group, while describing the role banks play in helping businesses grow. “Dubai Islamic Bank has contributed to our growth and shown us it understands our vision and stands ready to support us,” he points out. Polimar is a technical trading, specialty manufacturing and consulting group of companies headquartered in Sharjah. Founded in 1963, Polimar was initially involved in the design and fabrication of specialty metallic structures, and the supply and service of equipment and machinery. The company was founded by Ara’s father, the late Pierre Keusseya, in 1963. “After finishing a temporary contract with the company that employed him to support with the completion of a project for the British Army in Sharjah, my father went to say good bye to his friend the late Sheikh Khalid Bin Mohammad Al Qassimi, who suggested to him to stay on in the country as the future was looking very promising. Indeed despite the proverbial ups and

downs of the economy, the Emirates has prospered under the wise leadership of their highnesses the rulers,” Ara Pierre said. But the beginning seems to have been tough, he said. “From the stories I have heard from my father and from situations I have lived as a child, it was as tough as one should expect from any new venture, especially when the economy is on the fast forward mode”. Asked about the growth of the company, Ara said there is growth in size and know-how and there is growth in qualification. “The short and medium term outlook should focus on the first type of growth which is related to the size of the market, the share the company can have of that market and the enablers to acquire a competitive edge over similar or competing businesses. “The longer term outlook should focus on the second type of growth as

this will enable the company to diversify successfully in areas that will offer growth opportunities in the early stages of the lifecycle of that new business,” he pointed out. The managing director said that the company operates in various automotive specialty fields: technical trading for refinish; business to business and retail services for coachwork, body and paint; precision mould and collectible manufacturing as well as retailing for motorsport enthusiasts. “In the fields we operate in, the company’s standing is at the forefront”. On possible expansion plans, he said it depended on favourable market conditions. “Every good company should have plans to expand. However, we believe that this should happen only when the right opportunity and conducive market conditions present themselves”.

“Dubai Islamic Bank has contributed to our growth and shown us it understands our vision and stands ready to support us”

BANKING AND BUSINESS REVIEW

May 2010

SME SPECIAL - C OMPANIES

From electronic shop to manufacturing group Bank was a major support, says Sabah Group MD

eginning operations as a trading store for electronic products and home appliances in 1970s, the Sabah Group of companies today encompasses a number of activities, such as manufacturing, construction and steel fabrication, trading in automobile spare parts and real estate. The company was founded together by UAE national Mohammed Ramadan Moosa Sajwani and Joseph Kuttummel from India. Now the group has a portfolio of nine companies under it. Beginning with trading activities, the company started a manufacturing line with an initial investment of Dh3 million for the production of car radiators in the year 2000, with initial sales of Dh3.5 million a year. “Being a manufacturing company, we faced a lot of problems during the initial periods, particularly in the distribution of the product. But gradually, we started grabbing market share and today the company’s sales exceed

44 BANKING AND BUSINESS REVIEW

“We have grown with Bank of Baroda and our relationship of 33 years is a reflection of a mutually satisfying business relationship”

Dh60 million,” says Joseph Kuttummel, managing director. “Our growth is multidimensional, both in the number of units as well as sales and today we are leaders in car radiator sales and in a commanding position,” Joseph said. According to Joseph, the group has been dealing with Bank of Baroda for the past 33 years. “Bank of Baroda has contributed significantly to the growth of the company. We have a total exposure of Dh70 million and also a deposit relationship of Dh30 million with the bank. Timely approvals and proper financing as per our requirements were the major

May 2010

support we received from the bank and their products are suited to their customers’ financial needs,” Joseph pointed out. Referring to the future plans of the company, Joseph said the company has now started manufacture of copper and brass car radiators and the demand of the products is increasing. The company has also established a new aluminium radiator project in SAIF Zone, Sharjah named Sabah Radiator Industries. “We have grown with Bank of Baroda and our relationship of 33 years is a reflection of a mutually satisfying business relationship,” Joseph said.

SME SPECIAL - C OMPANIES

On way to a billion-dirham company Small garment trading company becomes top-leaguer in scrap metal

rom a modest beginning as a garment trading company operating out of a small rented office and storage facility in 1998, Pan Global Trading has today grown into a major international trading house, with its portfolio covering metals, foodstuff and garments. The company initially started by importing garments from countries like India and selling it in Gulf and Africa. Today, the company’s trading operations span a large number of destinations such as China, Singapore, Vietnam, India, Pakistan, Morocco, Mauritania, Senegal, Togo, Liberia, Kuwait, Bahrain, Oman, South Africa, the US etc. With the expansion and diversifica-

tion of trade, the company’s turnover kept increasing manifold. “Till the year 2003, our company recorded steady but modest growth and the turnover used to be in the range of Dh40 million. But with the expansion of operations, the current turnover is about Dh525 million. We are now among the largest exporters of metal scrap (in containerized segment)”, says Managing Director Anil Kapur.

Kapur says the company’s vision now is to increase the turnover to a billion dirhams in the next couple of years. Anil Kapur says SBI has helped the company by providing enhanced credit facilities as result of which the company could further increase the turnover. “We find SBI quite helpful and sensitive to our needs and requirements. We look forward to a long and fruitful relationship with the bank,” he said.

“We find SBI quite helpful and sensitive to our needs and requirements. We look forward to a long and fruitful relationship with the bank”

Shrenuj: Reputed diamond brand Company is among the leading manufacturers of gems and jewellery

ver a century old, Shrenuj is a name to reckon with in the international diamond and jewellery trade. It is a DTC sightholder company. A sightholder is a company on the Diamond Trading Company’s (DTC) list of authorized bulk purchasers of rough diamonds. From its modest beginning in 1906, the company today is among the leading manufacturers of gems and jewellery and reputed brand in diamond industry. Shrenuj as a group has branches in 14 countries, with a retail network in Hong Kong and India. Shrenuj DMCC, Dubai started its operation in 2006 under the leadership of Smit Kothari. He is promoter director of Shrenuj DMCC and has been instrumental in setting up business operations

all over Middle East. In a short span of four years, Shrenuj DMCC has achieved sales of more than $60 million. “State Bank of India (SBI) has been a partner with Shrenuj for many decades. We have enjoyed the best services in India as well as overseas. We as Shrenuj DMCC are proud to be pioneer client of SBI, DIFC, Dubai and we really appreciate the services provided by each and every staff member of SBI, DIFC, Dubai,” said Smit Kothari. “We are witness to the success of SBI, DIFC, in short span of their incorpora-

tion. The growth in such global financial meltdown can be credited to long and aggressive vision of CEO, AJ Vidyasagar, and his team,” he said. The company praised the bank management’s efforts to keep the branch operational on all seven days a week to give uninterrupted services to their customers and cited this as an example of the hard work and dedication of the staff. “We are confident that we would see new heights achieved by SBI Dubai in the years to come and would love to be always associated with them,” Kothari said.

“We as Shrenuj DMCC are proud to be a pioneer client of SBI, Dubai and we really appreciate the services” BANKING AND BUSINESS REVIEW

May 2010

C OV RE ALERESTATE STORY

Dr JR Gangaramani

Passion for breakthrough technologies Man who oversaw construction of Dubai World Trade Centre reminisces on a journey of mission By K Raveendran

reakthrough technology, cutting edge innovation and creativity are undoubtedly the hallmarks of Burj Khalifa, which is the new landmark on Dubai’s skyline. But the Dubai World Trade Centre, which the world’s tallest tower has replaced as the Dubai landmark, had exactly the same attributes, says

46 BANKING AND BUSINESS REVIEW

Trade Centre is one of Dubai’s most eco-friendly buildings even today as the exterior of the tower is almost maintenance-free and the very restricted use of glass on the building making it highly energy-efficient May 2010

(From left to right) Sheikh Maktoum Bin Mohammed bin Rashid Al Maktoum, Deputy Ruler of Dubai, HH Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of UAE and Ruler of Dubai, and Sheikh Hamdan bin Mohammed bin Rashid AL Maktoum, Crown Prince of Dubai with Dr JR Gangaramani

the man who oversaw the construction of Dubai’s most admired structure all these years. “The World Trade Centre was so futuristic during its time that it had set new benchmarks in architecture, construction and engineering feats”, says Dr JR Gangaramani, who was the project engineer for the construction of Dubai World Trade Centre. Ask him about green technology, he would say the Trade Centre is one of Dubai’s most eco-friendly buildings even today. The exterior of the tower is almost maintenance-free and the very restricted use of glass on the building makes it highly energy-efficient. The structure itself, though very elegant, is most cost-effective as it is straight and simple, compared to some of the irregular and twisted shapes of buildings of today, which add monstrous proportions to construction costs. The Trade Centre was built using precast, presegmental, pre-stressed technology, a first of its kind in the Gulf in its time and the technology saved time, labour and cost. In fact, the biggest attraction for the young Gangaramani to join the project

Sheikh Rashid, the then Ruler of Dubai, took great interest in the construction of the Trade Centre and visited the site almost daily, sometimes making more than one round in a day in 1974 was the challenge of working on the tallest ‘hi-tech’ building in the Middle East and a sign of things to come. He had just landed in Dubai, armed with an Indian engineering degree and three years of work experience back home. But it was a great time to arrive as the UAE federation had been founded just three years prior to that and the country had just commenced its programme of accelerated development and transformation under the vision of the late President Sheikh Zayed Bin Sultan Al Nahyan. Gangaramani recalls his experiences of interacting with the late Sheikh Rashid bin Saeed Al Maktoum, the then Ruler of Dubai, who took great interest in the construction of the project and visited the site almost daily, sometimes making more than one round in a day.

“Suppose he suggested a change to the way something was being planned, he would make a second visit later in the day to see how the change was shaping up. Whether it was construction, engineering or anything else, Sheikh Rashid insisted on bringing the latest technologies to Dubai”. Sheikh Rashid was also very conscious about costs and insisted that the work be done within the allocated budget. For instance, the number of apartments in the residential buildings adjacent to the Trade Centre was reduced by a few units so that the total cost remained within the originally allocated budget, he pointed out. Gangaramani is the proud owner of a personal collection of photos of the World Trade Centre site complex, tracking its progress through various stages,

BANKING AND BUSINESS REVIEW

May 2010

Dr JR Gangaramani with Sheikh Mohammed bin Zayed Al Nahyan, Ruler’s representative, Abu Dhabi and Deputy Chairman, Abu Dhabi Executive Council

including some of the earthwork for the construction. Once the Trade Centre got completed, Gangaramani was in search of other challenging responsibilities, which took him to Al Ain, where he was appointed to take charge of the Al Ain Flyover project. This was another project that saw the use of breakthrough technologies. He says that Al Ain, characterised by vast spaces, the greenery and water of the oasis as well as the warmth of the residents, connected well with his disposition, which prompted him to set up home there. It was here that he set up his own construction company Al Fara’a in 1980, first partnering with the company that originally employed him and later buying out the business in full from them. Gangaramani says that as an unknown entrepreneur who enjoyed a good rapport with the community, he set out to craft his life mission as ‘a conduit of knowledge, resources, state of the art technology and investment into the country’. Soon Al Fara’a was managing around 12 projects. Unlike most entrepreneurial ‘breakthroughs’, where one large achievement takes one

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on to the road of success, Al Fara’a was getting a ‘barrage of breakthroughs’. Nearly 30 years on, Al Fara’a now employs 18,000 people and has a presence in Dubai, Abu Dhabi, Al Ain and Sharjah, apart from its international footprint. The Al Fara’a Integrated Construction Group today spans property development, construction and related services as well as manufacturing and fabrication industries across the GCC and Asia. Al Fara’a Properties, which has launched five projects ranging from commercial to residential in a Dh10billion property portfolio, lat year completed the handover of its pilot project, Le Grand Chateau in Jumeirah Village, Dubai, six months ahead of schedule. The project was also awarded best development recognition by CNBC Arabia. Al Fara’a General Contracting, licensed as a Special Grade Company

by the UAE Government, has achieved a track record spanning multiple typed of projects of different magnitudes. The construction and related services segment of the Al Fara’a Group includes an investment arm, mechanical, electrical and plumbing supply and services (Al Sabbah Electro-Mechanical), exterior and interior finishing as and even precast and steel structures. In terms of manufacturing and fabrication, Belgium Aluminium and Glass employs cutting edge technology in its factories, that combined are arguable the largest of their kind in the UAE. Unibeton Ready Mix, backed by world class leading technology manufactures and optimises ready mix concrete to suit any requirement and is the leading concrete manufacturer in the Gulf. The Dh3.5 billion turnover group prides itself on its remarkable results in the realm of rewarding career growth and the personal development of its employees with a wide scope of training, recreational and developmental activities spanning multiple disciplines. The Group has also prioritised corporate social responsibility investment with the formation of its Al Fara’a Foundation that focuses on delivering sustainable long term solutions to meet the needs of its stakeholders. Gangaramani says he has adopted a five pillar approach to his philanthropic efforts. These pillars are care (helping vulnerable communities through community service), empowerment (developing communities and networks to facilitate optimal growth by means of education and development), growth (contributing to the sustainable economic advancement of our communities via entrepreneurial successes), challenge (inspiring community members to progressively reach for new heights with various sporting, educational and recreational sponsorships) and nurture (enabling communities to flourish through a lasting environmental focus).

Gangaramani set out to craft his life mission as ‘a conduit of knowledge, resources, state of the art technology and investment into the country’ May 2010

Top honours from President of India The President of India recently conferred a second award in one year on Al Fara’a Group frounder Dr JR Gangaramani in recognition of his community investment, business achievements and his role in improved UAE-India relations. He is only the fifth UAE resident and the sixth person in GCC to receive this honour. The President’s award, named Padma Shri, has been bestowed on Dr Gangaramani in recognition for his social work and business achievements. The prestigious Padma Shri Award, which was first conferred in 1954, is a civilian award given to an Indian for outstanding contribution or achievement in a chosen field. Categories include, among others, Business Excellence, Public Life and Social Service. Nominations to the award are made by State Governments, Union Territory administrations, ministries and other governmental bodies.

Dr Gangaramani’s Al Fara’a Integrated Construction Group is a conglomerate of 10 construction related companies that collectively employ 18,000 people. Last year in January, Dr Gangaramani was bestowed the Pravasi Bharatiya Samman Award, which is given to notable persons of Indian origin outside of India, by the President of India. Humbled by the appreciation of his achievements in the realm of entrepreneurial success, role in strengthening Indo-UAE ties and his efforts at caring for the communities in which he operates, Dr Gangaramani thanked the Rulers of the UAE for their economic wisdom in creating an environment conducive to realising one’s dreams and further reiterated his commitment to serving the people of the UAE.

BANKING AND BUSINESS REVIEW

May 2010

C OVALTH WE ER STORY

Private banking after the perfect storm Wealth management industry loses 25 to 30% of revenue since the outbreak of financial crisis By Peter Vayanos & Dr Daniel Diemers

rivate banks have spent the last 18 months dealing with one of the most difficult periods in modern financial history. A ‘perfect storm’ of asset-price declines and the near or actual collapse of some of the best-known wealth management firms has altered the behaviour of clients, prompting them to move into less risky financial instruments that are much less profitable for the banks. All of this has pushed revenue levels down by 25 to 30 per cent. As an added challenge, governments are cracking down on their wealthy citizens’ untaxed offshore accounts, forcing many private banks to find new value propositions.

An industry in transition

Over the last few months, Booz & Company has taken a closer look at the world’s leading wealth management markets by conducting in-depth interviews with more than 140 bankers, advisors, and regulators in 15 markets around the world, to understand the core drivers of private banking, while forming a perspective on the new rules of the industry and what it means for private bankers to adapt to the new realities ‘after the storm’ While the financial crisis has jolted the private banking industry, three fundamental characteristics of the industry remain intact:

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1. Fundamentally geared for growth While world wealth generally expands at the rate of GDP growth, the number of high-net-worth individuals (HNWIs), defined as people with more than US$1 million in investable assets, has been growing at anywhere from 1.5 to three times the rate of GDP. The increase in HNWIs is creating substantial wealth. The financial crisis of 2008 took its toll on HNWIs as massive devaluations hit all major asset categories and geographies. 2. Cyclical in nature There is no question that the revenue of private banks is highly correlated with the performance of equity markets. This cyclicality is no surprise; revenue in private banking depends heavily on transaction volumes and asset-based fees. As a change appears unlikely for the industry’s revenue-generating model, this correlation likely will hold. For the near term, that means the industry’s revenues will depend on the extent to which the markets can continue the rally they started in March 2009.

3. Profitable even in difficult times Since the beginning of this financial crisis, the wealth management industry has lost 25 to 30 per cent of its revenue because of a lower asset base, cautious market behaviour, and a shift toward low-margin financial products. Yet more than 95 per cent of private banks analysed worldwide were able to deliver positive pretax profits during this period. Private banks’ persistent profitability is a reflection of the speed at which they can adjust their operating models to align them with current business conditions.

Change levers

While the underlying dynamics are fundamentally promising for private banks, the industry must navigate through a number of significant changes going forward: 1. Tectonic shift in global wealth distribution While the majority of industrialised countries are just beginning to recover

Private banks have continued to deliver profits and many banks are starting to move strongly into emerging markets, especially in places like Asia and India May 2010

Private banks have continued to deliver profits and many banks are starting to move strongly into emerging markets, especially in places like Asia and India from the financial crisis, most emerging markets have already returned to pre-crisis growth rates. We believe that these varying rates of recovery will persist for the next few years, shifting the global wealth concentration to the East. Latin America: Prior to the crisis, private banking in Latin America was experiencing double-digit annual growth, with clients increasingly demanding onshore/offshore convergence and open architectures, which provide clients with access to best-ofbreed products from top suppliers in each asset class. Though 2009 was challenging in the region, Latin America’s immediate future looks brighter as its equity markets pick up, creating wealth through IPOs and M&A transactions. Middle East and Africa: Countries rich in natural resources will likely return to accelerated wealth creation even before the global economy fully recovers. Large government-led infrastructure projects will further boost the regional economies and many HNW and UHNW clients will benefit either directly or indirectly from these projects. Asia/Pacific: Led by China and India, the Asia/Pacific region will be where most new HNWIs will be created, driven by the strength of the underlying economies and a strong entrepreneurial spirit. By the end of 2011, nearly 3.6 million HNWIs are expected to live in the Asia/Pacific region, up from 2.57 million in 2008. Europe: GDP growth rates for key European markets are expected to remain flat for the next few years. A significant shift of assets among European countries is likely, due to the new regulatory regimes.

North America: North America continues to hold a significant share of the world’s HNWIs and UHNWIs (ultra-high-net-worth individuals). Slow growth in productivity and in North America’s economies is expected over the short to medium term, limiting the overall growth in asset markets and in the number of wealthy households. Many emerging-market countries are also expected to become more politically stable and thus offer good investment opportunities. This will create another disincentive to bring the new wealth offshore.

transparent, liquidity-oriented products with lower margins. Structured products in particular fell from favour, and clients largely retreated from risky and complex asset classes. A main cause of this behaviour was the reduced trust that clients had in banks, products, and relationship managers—a problem worsened by the fact that relationship managers, in turn, did not trust their own product providers anymore. The result is that clients have become more hesitant to delegate and have shifted assets from managed portfolios to nondiscretionary and self-directed mandates.

2. The end of the tax-induced offshore business model While the offshore business has traditionally been an essential part of private banking, it has recently come under increasing scrutiny, especially due to widespread perceptions that it enables tax evasion. In tandem with the recent G20 decision to crack down on tax havens, offshore locations are increasingly implementing standards of cooperation on tax evasion and softening their strict banking secrecy rules.. This change will presumably accelerate the crisis-induced fundamental changes in the competitive landscape and will affect especially private banking in traditional offshore locations.

4. Pressure on costs will endure Most private banks have responded to diminishing revenue pools by removing costs from their operations in a variety of ways. Although the rebound in financial markets since March 2009 has helped private banks to stabilise their top lines, profitability will remain under pressure for several reasons: • Transaction volumes during the recent market recovery have stayed quite low, and asset allocation remains biased toward low risk asset classes. • Clients have become wary of complex, non transparent or expensive products. • Many clients have shifted assets from managed accounts to self directed mandates, lowering the profitability of their accounts. • The relatively high-margin offshore assets will gradually transform into local onshore assets, at far lower price points. • Compliance requirements and the need to cope with operational and reputational risks will increase the cost of doing business.

3. More pragmatism in client behaviour Client behaviour changed during the crisis. The changes have come in phases and have created significant challenges for private banks. The first phase came after the market collapsed and clients lost money in late 2008 and early 2009. In the wake of this implosion, clients shifted their assets toward simple,

BANKING AND BUSINESS REVIEW

May 2010

5. New business models taking shape There is a distinct sense that open product architecture solutions will predominate in the future, with clients demanding access to best-of-breed products from top suppliers in each asset class. The integrated operating model served clients poorly in the financial crisis, eliminating the possibility of an objective intermediary and increasing the moral hazard of selling the structured products that were profitable for the banks but risky for clients. In the wake of that trust-shattering period, private banks need to further demonstrate their expertise in the areas of risk profiling, asset allocation, product selection, and due diligence. This also means that the model of the integrated bank will be more closely scrutinised than in the past.

The new imperative for success

While long-term prospects for the private banking industry are distinctly positive, private banks need to adapt their business models to the new realities: 1. Seriously commit to emerging markets The expansion and evolving behaviour of the HNWI population in China, India, and the Middle East will require private banks to operate in new ways in these markets. Wealth management players with global ambitions need an emerging market strategy to capture the large wealth expected to be generated in these regions in the coming years. They will also need to acquire or develop a deep understanding of, and access to, local investment opportunities as new wealth is increasingly invested locally. 2. Become a declared multi-shoring player The tax-neutral, offshore private banking proposition of many domiciles will not survive the current regulatory pressure and offshore clients are likely to withdraw part of their funds and increase local investments. Private banks

52 BANKING AND BUSINESS REVIEW

will have to proactively approach and support offshore clients whose governments are applying pressure on tax-optimised accounts. The goal is to serve as a truly trusted advisor and holistic wealth manager, helping clients repatriate their money and shift assets to onshore locations, thereby keeping assets within the bank, even if at significantly reduced margins. In the future, private banks will need to ensure full cross-border compliance and prepare for a time when pure offshore banking may be attractive only for selected domiciles. This requires banks to understand and closely monitor the regulatory environments in all markets in which they participate to enable them to react quickly and appropriately to regulatory changes in countries where they have clients. Offshore private banking will continue but will offer different value propositions. Smaller banks, as well as most subsidiaries of international banks will not be able to expand their onshore footprint and build the required level of capabilities, and these will likely become acquisition targets. 3. Develop new client service models The financial turmoil of the last few years has clearly changed how clients feel about their banking relationships. Clients are looking for consistent, reliable, and unbiased advice with a focus on what is right for them rather than what is right for their banker. The client service models of the future will have two main parts. First, clients will need to be segmented according to their true needs. Qualitative segmentations will become increasingly important in the futureâ&#x20AC;&#x201D;they will put wealth managers in a better position to consider all client requirements, emotional as well as financial. The second change involves client coverage models. Leading private banks have started to adopt new client

coverage models in which relationship managers focus on a limited number of client segments (in some cases, just one), as opposed to heterogeneous client portfolios in which the clients have diverse needs and backgrounds and are located in a wide range of domiciles. 4. Learn to make money (again) With revenue pools likely to remain depressed for the immediate future, and with higher compliance costs, wealth managers need to learnâ&#x20AC;&#x201D;or relearnâ&#x20AC;&#x201D; how to earn money. Three areas will be key: First, banks must use rebates and fee discounts more sparingly. Second, they must optimise the product/ service mix for each client. Third, they must adopt a disciplined approach to cost management. Top banks have already started to use advanced client profitability steering tools, which show the level of the economic profit by client, to fully understand where value is either created or destroyed. 5. Build scale, build capabilities There are several factors causing M&A to intensify in private banking including the push to separate distribution, production, and operations. A second factor is the need to quickly build scale in new markets, where indigenous companies are rapidly adding capabilities and gaining momentum. A third factor driving M&A is the desire to add revenue at a time when revenue pools are depressed. A fourth factor is that regulatory pressure has left some banks without a viable business model. Together, these factors have led to a burst of deals in the last year which are expected to continue, making the wealth management industry very attractive for players with a well-defined M&A strategy. We also expect to see more alliances and cooperative deals in which traditional private bankers try to expand the scope of their business.

Most private banks have responded to diminishing revenue pools by removing costs from their operations in a variety of ways May 2010

MARKE T S

IPO activity pick-up Five-fold increase in funds raised, compared to same quarter last year

nitial Public Offering (IPO) activity in the Middle East has risen significantly in the first quarter of 2010, recording a fivefold increase in the funds raised. Ernst & Young’s Middle East IPO Update for the first quarter says over $420.5 million was raised from six IPOs, compared to $83.6 million in the same period last year. According to Phil Gandier, Head of Transaction Advisory Services for Ernst & Young Middle East, the trend mirrors the performance of the global IPO markets in the first quarer. The regional upturn in number and size was largely based on the performance of the Saudi and Qatari markets. The regional markets also performed better than the last quarter, by raising $91.6 million in the fourth quarter of last year from 5 IPOs. “While it is too early to decree that markets have rebounded, this could potentially signal the return of normalcy to the markets, which had a very difficult 2009,” he says.

Saudi Arabia still robust Five IPOs in Saudi Arabia and one in Qatar made up the geographical composition of the regional IPO market for the first quarter. Mazaya Qatar Real Estate Development Company with an offer size of $144.2 million was the Middle East’s largest IPO, followed by Saudi Arabia’s Herfy Food Services ($110.2 million and Alsorayai Trading Industrial Group ($64.8 million). Solidarity Saudi Taka-

ful, Amana for Cooperative Insurance and Wataniya Cooperative Insurance were the other three with offer sizes of $59.2 million, $34.1 million and $8 million respectively. Saudi Arabia also led the IPO tally in the previous quarter –three out of the 5 Middle East IPOs were in the Kingdom. Phil says market appetite and investor confidence are cautiously picking up. The largest oversubscription in the first quarter was by Herfy Food Services at 4.6 times offer size. This could be symptomatic of the caution with which new IPOs will be greeted in 2010, he points out. “We may not see the hundreds or even tenfold oversubscription that were witnessed during the boom years. Firms will need to invest more time and resources in preparing their institution for an IPO and ensuring they have a compelling equity story. While challenging markets will come and go, it’s the companies that are fully prepared that will best be able to leverage IPO opportunities when they open.” Out of the total 6 IPOs this quarter, three were in the insurance/Takaful sectors. This trend was also observed in the previous quarter, when the regional markets went through a difficult phase. In Q4 2009, three out of 5 IPOs were for insurance firms. “Insurance licensing procedures in Saudi Arabia, which

opened up the sector to new entrants in 2005, oblige newly licensed firms to offer a percentage of their shares to the public within a set timeframe. This is why we see a disproportionate number of IPOs in the Kingdom’s insurance/ Takaful sector,” Phil explains. The global IPO activity in the first quarter of 2010 also showed substantial improvement over the same period last year. Results were driven by an ongoing robust Asian market and the revival of European listings. There were 267 deals globally in Q1 2010 worth $53.2 billion, compared to the 52 deals which raised $1.4 billion in Q1’09 (which had the lowest IPO activity in the past decade). Asia continued to experience significant IPO activity in the quarter, with 166 IPOs raising $35.1 billion, 66 per cent of the quarter’s total IPO fund raising. Nine of the 20 largest IPOs were from Asia (China, Japan and South Korea). “Emerging market activity continues to be strong, but we also saw a revival of activity in Q1 2010 in key markets such as Tokyo, London, Paris and Frankfurt. Despite concerns about volatile market conditions at the beginning of this quarter, we expect that investors will continue to return to the European and North American markets as the global economy improves,” said Gregory K. Ericksen, Global Vice Chair for Strategic Growth Markets for Ernst & Young.

While challenging markets will come and go, it’s the companies that are fully prepared that will best be able to leverage IPO opportunities when they open BANKING AND BUSINESS REVIEW

May 2010

C OV ER STORY CREDIT R ATING

GCC Credit Rating Scale Robert E Richards of Standard & Poor’s explains process

tandard & Poor’s Ratings Services has introduced a new credit ratings scale, known as the GCC regional ratings scale (GCC scale), for the assignment of credit ratings on issuers domiciled in GCC countries or that issue local currency debt in the GCC. The GCC scale serves issuers, counterparties, intermediaries, investors, and insurers involved in GCC’s financial markets by providing independent opinions of relative creditworthiness

54 BANKING AND BUSINESS REVIEW

for GCC-related issuers and issuances. The GCC regional rating scale is designed for issuers based in the GCC region and for capital markets debt, bank loans, and shariah-compliant obligations issued in GCC currencies by entities within and beyond the GCC, the rating agency says. The GCC regional scale, while based on issuers and issuances in the GCC region, is designed to complement the existing global rating scale and may offer finer credit risk differen-

May 2010

tiation within the region, says Robert E Richards, criteria officer at Standard & Poor’s. The GCC scale is the second regional ratings scale that Standard & Poor’s has offered, joining the ASEAN regional rating scale, which was introduced in May 2009. Robert answers questions on the rating process. Q: How will a GCC regional scale rating appear and what are its characteristics? A: GCC scale ratings will feature the

identifying prefix gc. The GCC scale features both long- and short-term ratings. The highest long-term rating is ‘gcAAA’ and the highest short-term rating is ‘gcA-1+’. GCC scale ratings have their own respective rating definitions, which can be found on RatingsDirect under the Criteria tab or Standard & Poor’s website. Q: What are the differences between a global scale rating and a GCC scale rating? A: The primary difference is one of scope. GCC scale ratings are designed to facilitate credit-risk comparisons among GCC-related issuers and issuances. By contrast, a global scale rating is based on credit-risk comparisons among issuers and issuances located all over the world. A GCC scale rating may allow for finer credit risk differentiation between some regional issuers and issuances. Q: Are the criteria for assigning GCC scale ratings different from those used to arrive at global scale ratings? A: No. The criteria used to analyze business risk, financial risk, and other elements of credit risk are the same for both regional and global scale ratings. Q: Can an issuer be assigned both GCC scale and global scale ratings? A: Yes. Both GCC scale and global scale ratings can be assigned to issuers and issues, although the GCC scale is designed to facilitate comparisons of GCC issuers and GCC currency-denominated debt issues distributed in GCC member states. Q: Are GCC regional ratings comparable to other Standard & Poor’s regional scale ratings? A: No. Each regional rating scale and national rating scale is particular to

the relevant regional or national market and addresses the credit risk environment there. Q: Who might find GCC regional ratings useful? A: GCC regional ratings may be useful to issuers, counterparties, intermediaries, investors, and insurers seeking credit ratings on GCC issuers and issuances relative to other issuers and issuances within the region. GCC regional ratings might be used for traditional capital markets debt and bank loans, as well as for shariahcompliant obligations. Q: Why are GCC scale ratings and the GCC scale being offered? A: The GCC and its member countries are taking steps to develop their local and regional capital markets. The proposed GCC Monetary Union and the development of a regional yield curve based on increased sovereign issuances are examples of this development. GCC regional ratings and the GCC scale may provide a helpful basis of comparison for credits affected by these and other measures, and could encourage broader regional market participation. GCC regional ratings are designed to serve as an independent benchmark and information tool for investors. They, and the GCC scale, may provide a complementary tool for rating local or regional currency issuance alongside the global ratings used for rating non-GCC currency denominated issuers and issuances. GCC regional ratings and the GCC scale are designed to meet the needs of investors participating in national or regional GCC capital markets by providing finer distinctions of credit quality. Investors may use GCC regional ratings and the GCC scale to compare and contrast the relative creditworthiness of issuers and issuances in the GCC.

Q: Does Standard & Poor’s have regional or national scales in other parts of the world? A: The GCC scale joins the ASEAN scale as Standard & Poor’s second regional scale. Standard & Poor’s has also established national rating scales in various capital markets, including those of Canada, Taiwan, Mexico, Brazil, Kazakhstan, Russia, South Africa, and Turkey. We also provide shortterm ratings on our Nordic scale for the Swedish commercial paper market. Q: How does Standard & Poor’s treat country risk in GCC regional ratings? A: Country risk results from the destabilizing effect of certain macroeconomic and other factors on the commercial activity of a country and can disrupt the full and timely payment of obligations sourced in that country. Standard & Poor’s analyzes country risk in assigning its global and regional scale ratings. The rated debt’s currency of repayment is a key analytical factor. An obligor’s capacity to repay its foreign currency obligations may be lower than its capacity to repay obligations in its local currency because the sovereign may restrict access to foreign exchange. Q: Will Standard & Poor’s assign an issuer a regional rating above that of its sovereign? A: As with Standard & Poor’s global scale, unless the relevant sovereign has the highest possible rating on the regional scale, it is possible for certain issuers domiciled there to obtain a higher regional rating than that of the sovereign. If the sovereign has the highest possible rating on the GCC scale, that is, ‘gcAAA’ for long-term debt or ‘gcA-1+’ for short-term debt, it is not possible for a non-sovereign issuer to have a higher GCC regional rating than that sovereign.

BANKING AND BUSINESS REVIEW

May 2010

TECHNOLOGY

TV becomes more Sharp with yellow

harp has added yellow to the traditional red, green and blue palette to create a new television that is capable of producing stunning colour pictures. The company has just launched a series of television sets with the revolutionary Quattron quad pixel technology in the GCC market. Masahiro Yokota, Sharp’s Divisional General Manager, LCD Digital System Division, Audio Video System Group, says the proprietary Quattron technology will revolutionise the TV industry because it will influence the way in which people would like to watch television. “The innovative Quattron technology promises the next level of growth for Sharp, as part of the company’s aggressive global strategy to take on the leadership position in LCD TV technology,’’ he says. The new Quattron LE-820 series featuring Quad Pixel technology comes in 52, 46 and 40-inch sizes, and they all have Sharp’s UltraBrilliant Edge-lit LED technology as standard. The sets are just 39mm deep, and the panel glass on the LE820 series extends to meet the edge of the TV for a more seamless look. The X-Gen LCD panel with UV2A technology has unique photo-alignment precisely controls the alignment of the liquid crystal molecules, while minimizing light leakage, to reproduce amazingly bright whites and extremely deep blacks. The mercury-free LED backlighting reduces energy consumption over that of conventional fluorescentbacklit LCDs, and every set has an eco picture control. According to Fred Yamaguchi, Managing Director, Sharp Middle East, the new technology is not just a step forward in the company’s vision,

56 BANKING AND BUSINESS REVIEW

Masahiro Yokota, Divisional General Manager, LCD Digital Systems Division, Audio Visuals Systems Group Sharp Corporation, at the Dubai launch

but the ushering in of a new era in TV technology because it introduces a fourth colour sub-pixel to the conventional LCD three-colour palette. This new four-colour technology enables billions of colours to be displayed, and brings to TV a range of never before seen colours – dazzling golds, tropical ocean blues, and sunflower yellows, to name a few, he said. “This is a fantastic distinction that will shape consumer standards for LCDs. Along with their pioneering colour reproduction; these new Quattron models feature an energy-efficient LED backlight and décor-enhancing style. The technology also uses smaller dots to make up images, enabling ultra-high resolution”. Sharp feels that the new range of LED TVs will help the company boost its share in the Middle East & Africa market and help it realize the objective of taking market leadership in the LED TV segment. The LCD market in

May 2010

the region is expected to grow to over 3.5 million units, of which Sharp plans to achieve at least 10 per cent market share, according to Manu Mahdi, General Manager, Sharp UAE. With the launch of this AQUOS range equipped with Quattron technology and other innovative TV products, Sharp officials are forecasting a 30 per cent growth in sales this year for this region.

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May 2010

P.O. Box 1049, Dubai Fax: 04 3937774 Swift ARAIAEAD, E-mail: aaibdxb@emirates.net.ae Web: www.aaib.com History: Established 1964 as the first Arab joint venture bank Hemant Jethwani General Manager UAE Dubai Branch: Key Executive Alaa Sobhy Head of syndication and assert trade Abu Dhabi Tel: 02 6323400; Fax: 02-6216009 Arab Monetary Fund Bldg, Corniche Street, P.O. Box 928, Abu Dhabi Key Executive Hani Hassan Branch Manager

Arab Bank Head Office Jordan â&#x20AC;&#x201C; Amman Tel: 04 2950845; Fax: 04 2024369 P.O.Box 950544, 950545 Amman 11195 Website: www.arabbank.ae History: The Arab Bank Group is one of the principal financial institutions in the Arab world and ranks among the leading international banks in terms of equity, earnings and assets. Established in 1930 in Jerusalem. The Arab Bank Group is owned by about 4,000 shareholders from all over the world, mainly Arab countires. The Group has a diversified network of over 350 branches worldwide. Abdul Majeed Shoman Chairman Abdel Hamid Shoman Deputy Chairman & Chief Executive Officer U.A.E Area Management Mohammad A . Azab Senior Vice President - Dubai Saed Jarallah Senior Vice President â&#x20AC;&#x201C; Abu Dhabi Aladin Al-Khatib Treasury Head Hatem Kurdieh Corporate Banking Head Tareq HajHasan Retail Banking Head Mohammad Mattar Central Operations Unit Manager Hani Hirzallah Regional Manager Human Resources /Gulf Region Tareq Ibrahim Head of Human Resources Ammar Al Khayyat Financial Controllar Ghassan Nimer IT Center Regional Manager Jihad Ghoury Legal Counsel Sanjay Malhotra Global Head of Marketing & Product Develeopment Nasser Maghtheh Senior Auditor Anan Al Khatib Premises & Pruchasing Officer (Engineer) Suleiman Malhas U.A.E Branches Audit Centre Manager Dubai Al Ittihad Street Mohammed Azab

04 2950845

Branch Manager

Deira Mohammed Elayyan Branch Manager

04 2221231

Abu Dhabi Al Naser Street Nasser Serries Branch Manager

02 6392225

Al Ain Colock Tower roundabout, Al Ain Street Maen Jarrar Branch Manager Sharjah Al Arooba Street Maher Al Debis Branch Manager

03 7641328

Ajman Rashid Bin Humaid Street Modhar Kherfan Branch Manager

06 7422431

Ras Al Khaimah Oman Street, Al Nakheel Ali Zatar Branch Manager

07 2288437

Fujairah Sheik Zayed Street

09 2222050

06 5618999

Abdel Hamid Qamhieyah Branch Manager Call Centre Within UAE Outside UAE

800 40 43 009714 2953889

Arab Bank for Investment and Foreign Trade Abu Dhabi Tel 02 6721900 Regional Head Office, Sh. Hamdan Street, Tourist Club Area Fax 02 6785271 P.O. Box 46733, Abu Dhabi Telex 22455 ARBIFT EM Email: arbiftho@emirates.net.ae Website: www.arbift.com History: Established in 1976 in Abu Dhabi Registered as a Puvlic Joint Stock Company Management & Personnel Ibrahim N. R. Lootah General Manager 02 6952286 Hassan S. Kishko Head of Finance 02 6721299 M.A. Majid Siddiqui Head of HR & Admin 02 6728785 Khalid Mohammed Bin Amir Head of Operations 02 6776109 Najib Taleb Nasser Head of Commercial Banking Ahmed Majid Lootah Head of Retail Banking 02 6743801 M. Santosh Babu Senior Manager IT 02 6722975 Izzeldin Al Siddiq Salem Mgr - Inspection & Internal Audit 02 6780592 Osman Hamid Suliman Mgr - Banking Relations Dept 02 6787380 Mir Asif Ali Mgr - Treasury Dept 02 6721600 Saidi Zoubir Head of Business Dev. Dept. 02 6723763 Tareq Sâ&#x20AC;&#x2122;adi Al Darras Mgr - Credit Risk Management 02 6720886 Issam Abugisseisa Legal Advisor 02-6791642 Abu Dhabi Main, Sh. Hamdan Street 02 6721900 Noora Ebrahim Manager -Sales & Services 02 6780423 Souk Branch 02 6269500 Al Masaood Building - Khalifa Street, Abu Dhabi Nasser Rashed Al Ali Manager 02 6275087 Al Ain 03 7655133 Mohd. Sultan Al-Darmaki Bldg., 1st Floor, Old Passport Office Road. Hussain Marzouqul Manager 03 7656482 Dubai Arbift Tower, Baniyas Street, Deira Adel Mohd. Khalfan Manager Al Bagh

04 2220151

Sharjah King Faisal Street Fatima Al Muani Manager

06 5744888 06 5747766

04 2282071

Arab Banking Corporation Abu Dhabi Office Office, 10th Floor, Abu Dhabi Trade Centre, Abu Dhabi Mall P.O.Box 6689, Abu Dhabi Mohamed El Calamawy Chief Representative

02 6447666

Management-UAE Hemant Jethwani Alaa Sobhy Mahendran Raman

Tel: 02 6323400 Fax: 02 6216009

BLOM Bank France SA Dubai Tel 04 2284655 Al Maktoum Street, Deira Dubai, P.O. Box 4370 Fax 04 2236260 email: info@blomfrance.ae www: www.blombank.ae Bassem Ariss Regional Manager 04 2222355 Samir Hobeika Branch Manager 04 2214648 Michel Germanof Manager Corporate Credit UAE 04 2242067 Mohammad M Ansari Treasurer 04 2224812 Sharjah PO Box 5803, Al Buheira Tower, Al Buheira Corniche Tel 06 5736100 Fax 06 5736080 Mokhtar Kassem Branch Manager

Bank Muscat Dubai Representative Office Dubai Creek Tower, Baniyas Road, Deira P.O. Box 29969, Dubai Lawrence P. Monteiro Chief Representative

Tel 04 2222267 Fax 04 2210115

BBK BSC Dubai-Representative Office Dubai Creek Tower Office 18A, Baniyas Road, Deira PO Box 31115 Website History: Established on 16th March, 1971

04 2210560 Tel 04 2210560 / 70 Fax 04 2210260 www.bbkonline.com

Murad Ali Murad Karim Bucheery Sh. Rashed Al Khalifa

Chairman CEO & GM Deputy General Manager

Dubai ReP-Office: Head of Representative Office Rajiv Kapoor Al-Alwan

CK Jaidev Relationship Manager & Loan Syndications Wafa Relationship Manager & Loan Syndications

Fax 02 6444429

Bank of Baroda

Arab Emirates Investment Bank PJSC Head Office: Cairo Egypt Regional Office: Dubai ART Tower, Al Mina Road, Opposite Maritime City, Bur Dubai P.O Box 1049 Dubai SWIFT: ARAIAEAD E-mail: aaibdxb@eim.ae Web: www.aaib.com

Abu Dhabi Branch Arab Monetary Fund Bldg., Corniche P.O Box 928, Abu Dhabi

Tel: 04 3937773 Fax: 04 3937774

General Manager Head of Syndication and Asset Trade Head of Operations and Liabilities

Dubai Zonal Office: Sheikh Rashid Bldg. Ali Bin Abu Talib Street, Bur Dubai, P.O.Box 3162, Dubai Tel: 04 3531628 E-mail: ce.gcc@bankofbaroda-uae.ae Fax: 04 3530839 UAE Website: www.bankofbarodauae.ae History: Established in 1908, July 20 Nationalized on July 19, 1969 Zonal Office, Dubai Ashok K. Gupta Narayanan Devarao Umarmiya S .Sayied

Chief Executive, (GCC Operations) Dy. Chief Executive Chief Manager (Credit)

BANKING AND BUSINESS REVIEW

04 3136699 04 3136617 04 3136690

May 2010

Paramjeet S. Bhatia Sujeet V. Bhale P.K. Rout

Chief Manager (Syndication) Chief Manager (Syndication) Senior Manager (HR & Admn.)

Retail Banking Dubai H. S. Sagar Renuka Shyam Mehul Kumar Dave Shaibal Banerjee Niermala Behera K. Prabha

Chief Manager (Retail / Marketing) 04 3136658 Senior Manager (Retail/Marketing) 04 3136603 Senior Manager (Marketing) 0566195733 Manager (Marketing) 0566093201 Manager (Marketing) 0558638983 Manager (Marketing) 0566253180

I.T. Dept. Anil Kumar Agrawal Hardeep Singh

Senior Manager (I.T.) Senior Manager (I.T.)

04 3136661 04 3136663

Treasury Dilip Kumar Mansingh Shankar Kumar Jha Vikrant Gupta

Senior Manager (Dealer) Manager (Dealer) Manager (Dealer)

04 3136630 04 3136631 04 3136636

Dubai: Sheikh Rashid Bldg, Ali Bin Abu Talib Street, Dubai Bur Dubai N Sundareswaran Asst.General Manager M.V.Murali Krishna Chief Manager (Operations) Sarat C.Baral Chief Manager (Credit) Sunil Tutoo Senior Manager (India desk) Lalitha Janakiraman Senior Manager (Trade Fin.)

04 3136647 04 3136692 04 3136694

04 3136666 04 3136616 04 3136670 04 3136610 04 3136680 04 3136620

Abu Dhabi Al Halami Center, Sheikh Hamdan Street, Abu Dhabi 02 6330244/6322000 N.K. Batra Asst. General Manager 02 6344302 H.T. Solanki Senior Manager (Credit) 02 6326364 Barun Meher Senior Manager (Operations) 02 6326364 Sunil Kumar Manager (Marketing) 0566092501 Sharjah Al Mina Road, Al Maraijah , Near Sharjah Cinema, Sharjah 06 5684231/5686232 B.B. Pradhan Chief Manager 06 5683273 S.K. Tiwari Senior Manager (Operations) 06 5687086 Satya Narayan Patra Senior Manager 06 5684231 Sanjeev Singh Manager (Marketing) 0566093847 Shiv Kumar Shukla Manager (Marketing) 0566241586 Al Ain: Clock Tower, Roundabout, Planning Street, Al Ain Ashwini K Patria Senior Branch Manager Akhilesh Vashistha Senior Manager (Operations) Deira: Kuwaiti Bldg., Al Rigga, Baniyas Street, Deira Ramesh M. Shetty Asst General Manager Pamela Azaredo Chief Manager (Operations) Satish Agarwal Chief Manager (Credit) R K Madaan Manager (Marketing) S.S. Reddy Senior Manager (Marketing) Vipin Bhatt Manager (Marketing) Ras Al Khaimah Al Qasimi Bldg, Oman Street, Al Nakheel Surendra S. Parihar Senior Branch Manager J.K.Jais Senior Manager (Operations) K.S.Iyer Senior Manager (Credit)

60 BANKING AND BUSINESS REVIEW

03 7519880 03 7659554 0508591171 04 2287949 04 2286516 04 2286216 04 2292181 0559692170 0501934096 0566092869 07 2229293 07 2229293 07 2229293 07 2229293

May 2010

Bank of New York Representative office Suite 402, The Blue Tower, Sh. Khalifa Bin Zayed Street P.O.Box 727, Abu Dhabi Hani Kablawi Managing Director

Tel 02 6263008 Fax 02 6263308

Bank of Sharjah Sharjah Head Office – Al Hosn Avenue Tel 06 5694411 P.O. Box 1394, Sharjah Fax 06 5694422 E-mail: bankshj@emirates.net.ae History: Established on 22nd December 1973 with Banque Paribas, Paris Ahmed Abdulla Al Noman Chairman Varouj Nerguizian General Manager Mario Tohme Deputy General Manager Fadi Ghosn Deputy General Manager Ali Burheimah Commercial Manager Mohammed Asghar Senior Operations Manager Fares Saade Senior Manager Michel Germanos Risk Manager Jayakumar Menon Finance Manager Berj Tossounian Credit Manager - Sharjah Wahide Assaad    IT Manager Jihad Aoun    Investment Manager Samer Hamed    Audit & Control Manager Abu Dhabi Tel 02 6795555 Al Mina Street, P.O.Box 27391 Fax 02 6795843 Ramzi Saba Senior Manager Mazen El Attar Operations Manager- Abu Dhab Anni Barsoum Credit Manager - Abu Dhabi Dubai Tel 04 2827278 Al Gharoud Street, PO Box 27141 Fax 04 2827270 Nadim Melki Senior Manager Toufic Youakim Credit Manager - Dubai Fadi Haddad Operations Manager - Dubai Al Ain 03 7517171 Khalifa Street, PO Box 84287 Fax 03 75170770 George Dib Branch Manager Rida Higazi Deputy Branch Manager

Bank Saderat Iran Dubai Regional Office, Al Maktoum Street, P.O. Box 4182

Tel 04-6035555 Fax 04 2229951

Dr.Hamid Borhani                 Regional Manager Abdul Reza Shabahangi         Assistant Regional Manager Mohammad Yousefi Peyhani       Assistant Regional Manager Majid Tavasoli                            H.R. & Organization Dept. Manager Gholamreza Joulaie               Credit Facility Dept. Manager Rahim Erfan Moghaddam        Account Dept. Manager Mehran Arzhang                        Letter of Credit Dept. Manager                Majid Mirnasiri                          Recovery Dept. Manager Hamdi Reza Khalajzadeh         Dealing Dept. Manager Hojatollah Malek Mohammadi    IT Dept. Manager Mansoor Sedaghat Motlagh        Service Dept. Manager  Mohsen Hossein Hosseinpour   Manager of Al Maktoum Branch Gholamreza Ebadi Fard          Manager of Murshid Bazar Branch Saeed Mirzaian Tafti         Manager of Sheikh Zayed Rd. Branch Ferdos Zolfagharian            Manager of Bur Dubai Branch Seifollah Farzan Mehr      Manager of Sharjah Branch

Abu Dhabi Mohd. Joan Al Badi Bldg., Hamdan St. P.O. Box 3771 Ghassan Haddad Acting Regional Manager Samir Rached Acting Branch Manager

Jalil Vosooghi                            Manager of Ajman  Branch Ali Abasteh                       Manager of Abu Dhabi Branch Peyman Sabri                 Manager of Al Ain Branch

Banque Du Caire Abu Dhabi Regional Head Office (02) 6225880 P.O. Box 533, Abu Dhabi Telefax 02-6225881 History: Established on 8th May, 1952 On July 1, 1960 the Amman Branch became independent under the title of Cairo Amman Bank. In July, 1961 the Bank was nationalized. On November 2, 1962 the Lebanese branches were absorbed by Banque Misr-Liban S.A.L On October 1, 1979 fo3rmer branches in Saudi Arabia have been saudized and a new bank was formed under the name of Saudi Cairo Bank. Mohamed kamal Al Deen Barakat Chairman                     Ahmad Sherif Rehab Regional Manager   Abu Dhabi - UAE PO Box 533 Tel:        02-6272525 Abu Dhabi Branch  Mohamad Kamal Farid (Acting Manager) Tel:         02-6273000 Dubai Branch    Labib Abdul Ghaffar Tel:         04-2715175 Sharjah Branch      Tareq Hafez Tel:         06-5739379 Ras Al Khaima      Mohamad Abdul Ghani (Acting Manager) Tel:         07-2332245 Al Ain                          Abdul Hamid  Saeed Tel:         03-7511104

Barclays Bank PLC Dubai Emaar Business Park, Building No. 4, Sheikh Zayed Road P.O. Box: 1891, Dubai Website www.barclays.com

Tel: 04 3626888 Fax: 04 3663133

Saleem Sheikh Regional Managing Director, Middle East & North Africa Mark Petchell Group Country Managing Director Amin Habib Director - Corporate Banking Faizen Mitha Regional Treasurer Farrukh Zain Head of Trade Sales Florence Goodman Head of Corporate Afffairs & Public Relations David Inglesfield Location Manager - International & Premier Banking Callum Watts-Reham Director, Market Manager, Gulf - Barclays Private Clients Barclays Capital Dubai International Financial Centre, Level 9, West Wing, The Gate Building, Sheikh Zayed Road, Dubai Nicholas Hegarthy Managing Director, Head of Middle East & North Africa

BLC Bank (France) S.A. Head Office 17-19 Avenue Montaigne 75008 Paris, France Mr. Andre Tyan General Manager

Tel 33 1 56 52 11 00 Fax 33 1 56 52 11 11

Regional Office Dubai Al Maidan Tower, Al Maktoum St. Tel 04 2222291 P.O. Box 4207, Dubai Fax 04 2283935 E-mail: blcdxbrm@emirates.net.ae Melhem Dagher Administration & Operations Manager Dubai Al Maidan Tower, Al Maktoum St. P.O. Box 4207, Dubai Hamze Abdul Sater Branch Manager

Tel 04 2222291 Fax 04 2279861

Tel 02 6220055 Fax 02 6222055

Sharjah Al Salam Bldg., Al Mina St. P.O. Box 854 Victor Khoriaty Branch Manager

Tel 06 5724561 Fax 06 5727843

Ras-Al-Khaimah Sheikh Ahmad Bin Saker Al Quasimi Bldg., Al Montaser St. P.O. Box 771 Abd El Hajj Branch Manager

Tel 07 2286222 Fax 07 2275067

BNP Paribas Abd Ahmad Al Hajj Branch Manager Abu Dhabi Khalifa Street, P.O. Box, 2742, Abu Dhabi Marc Checri General Manager

Tel 02 6130400 Fax 02 6268638

Central Bank of the U.A.E Abu Dhabi Tel 02 6652220/6915555 Head Office, Al Bateen Area, Bainoona Street Fax 02 6668483/6668621 P.O.Box: 854, Abu Dhabi, www.cbuae.gov.ae E-mail: sultan_rashid@cbuae.gov.ae Swift: CBAU AE AA Reuters dealing code: CBEM History Established in 1980 as a central bank of the United Arab Emirates by a federal decree. Central bank took over the activity of the United Arab Emirates currency board which was established in 1973. Management & Personnel H.E. Sultan Bin Nasser Al-Suwaidi Governor H.E. Mohd. Ali Bin Zayed Al Falasi Deputy Governor Board of Directors H.E. Mohd. Eid M. Jasim Al-Meraikhi H.E. Jumaa Al-Majid H.E. Sultan Bin Nasser Al-Suwaidi

Chairman Vice Chairman Governor

Members Ali Al-Sayed Abdulla, Jamal Nasser Lootah, Khalifa Nasser Bin Huwaileel, Saeed Rashid Al Yateem Al Muhairy Executive Directors Saeed Abdulla Al Hamiz nation Dept. Rashid Mohamed Al Fandi Saif Hadef Al Shamesi Salem Ahmed Al-Hammadi Abdulla Hamad Al-Zaabi Jamal Ebrahim Al Mutawaa

Executive Director-Banking Supervision & ExamiExecutive Director - Banking Operations Dept. Executive Director - Treasury Department Executive Director - Research & Statistics Department Executive Director - Internal Audit Department Executive Director - Administration Department

Economic Advisors Abed Alla Osama Malki, Mohammed Zeitouni Bechri Portfolio Managers Mohammed Abdulla Mohammed, Brian Gardner Anti-Money Laundering & Suspicious Cases Unit Abdul Rahim Mohamed Al Awadi Asst. Executive Director General Secretariat & Legal Affairs Division

BANKING AND BUSINESS REVIEW

May 2010

Salem Said Al Kubaisi

Senior Manager

Financial Control Department Hassan Ibrahim Al Hamar

Senior Manager

Personnel Division Ali Ghurair Al Romaithi

Senior Manager

Correspondent Banking Division Sultan Rashed Al-Sakeb

Senior Manager

Public Relations Division Abdul Raheem Abdullah

Manager

Information Technology Division/ UAE Switch Division Khalifa Al Dhaheri

Senior Manager

Dubai P.O. Box 448 Omar Al Qaizi Manager-in-Charge

Tel: 04 3939777 Fax: 04 3937802

Sharjah Tel: 06 5592592 Old Airport Road, Opp. Immigration Bldg., P.O. Box 645, Sharjah Fax: 06 5593977 Zakaria Abdul Aziz Al Suwaidi Senior Manager Ras Al Khaimah Al Nakheel, Oman Street, P.O. Box 5000 Salem Jasem Al Baker Asst. Executive Director

Tel: 07 2284444 Fax: 07 2284646

Fujairah P.O. Box 768, Fujairah Ali Mubarak Saeed Abbad Senior Manager

Tel: 09 2224040 Fax: 09 2226805

Al Ain Ali Ibn Abee Taleb Street, Oud Al Touba P.O. Box 1414 Ajlan Ahmed Al Qubaisi Asst. Executive Director

Tel: 03 656656 Fax: 03 664777

Citibank N.A (UAE Branches) Date of Establishment 1964 Nationality USA Legal Status Commercial Banking Services (F) Regional Head Office Oud Metha Towers P.O Box 749, Dubai – UAE Tel: 04- 3245000 Telex: 023 6738736 Cable: CITIBAEM Swift: CITIAEAD Reuters: N/A Email: karim.seifeddine@citi.com Website: www.citibank.ae Auditors: KPMG Domestic Branches: Al Wasl Road Branch (Main Branch) Tel: 04 3245000 Oud Metha Road, P.O Box 749 Dubai Branch (Next to Burjuman) Tel: Abu Dhabi Branch Tel: 02 6982206 Al Salam Street, Next to Lulu Center Fax: 02 6726381 P.O Box 999, Abu Dhabi Sharjah Branch Tel: 06 5072101 Beside Sharjah Emigration, Fax: 06 5723378 Opposite Civil Court. Sharjah Al Ain Branch Tel: 03 7641090 Sh. Zayed Street Fax: 03 7663887 Broad of Directors: N/A

62 BANKING AND BUSINESS REVIEW

May 2010

General Management: Atiq Ur-Rehman, MD for the Middle East and Chief Executive Officer, UAE Sanjoy Sen, Consumer Bank Head – Middle East Mohammed Azab, Chief Officer, UAE Offices, Citi Private Bank

Clearstream Banking Dubai Tel 04 3310644 City Tower 2, Sheikh Zayed Road Fax 04 3316973 Website: www.clearstream.com Robert Tabet Vice President Middle East & North Africa

Commercial Bank International Dubai Tel 04 2275265 Head Office Dubai  Al Riqqa Street Deira , P.O  Box 4449                       Tel : 04  2275265   Website : www.cbiuae.com Fax : 04 2279038   Hamad Al Mutawaa Chairman   H.E. Humaid Al Qatami Deputy Chairman   Abdulla Rashid Omran Managing Director and Board Member 04  2242104 Mohammed Saadeh Abdulla Amer Jasem Hesham Abdulla Ahmed Mustafa Tahoun Ramanthan Murgappan Zainab Nour Aldin Yousef Haddad Bashir Haji Mohd A.D.Abooty K.E Mammoo Faris Saddi Yousef Al Marshoudi Tariq Selaij Ameena Bin Kaali Ahmed Al Junaibi Abdulla Ali Almadhani Mohammed Ishaq Ahmed Darwish Alyia Al Mulla Ahmed Bin Masood Fujairah Branch Manager

Head of GBG 04 2126500 Head of HR & Admin 04 2126466 Head of Branches & Services 04 6020615 Head of Internal Audit & compliance Division 04  2126603 Senior Manpower planning & Recruitment Manager 04 2126444 Employee Relations Manager 04 2126 442 Planning & Development Manager 04 2126190 Chief Dealer 04 2126214 Head Of Operations & Finance 04 2126291 Accounts Manager 04 2126215 Chief information Officer 04 2060700 Dubai Branch Manager 04-2275265 Bur Dubai Manager 04-3559577 Sheikh Zayed Branch Manager 04 3405555 Abu Dhabi Branch Manager 02-6913111 Al Ain Branch Manager 03 7669994 RAK  Branch Manager (AL Manar Mall) 07 2274777 RAK  Branch Manager (Nakhel Branch) 07 2227555 Sharjah Branch Manager 06 512100

Dubai Main Branch (Al Riqqa Street) Yousef Al Marshaudi Branch manager Bur Dubai Tariq Sulaij Branch manager Sheikh Zayed Road Ameena Mhd. Bin Kaadi Branch manager Abu Dhabi Ahmed Sulaim Al Junaibi Branch Manager AL AIN Abdulla Ali Branch manager Ras Al Khaimah Khaled Al Mannai Branch Manager (Manar Mall) Ahmed Yousef A. Darwish Branch Manager (Nakeel Branch) Sharjah Aliya Al Mulla Branch manager

Commercial Bank of Dubai COMMERCIAL BANK OF DUBAI, P.O. BOX 2668, AL AITIHAD STREET, DUBAI

09 2011777 04 2126101 04 3555511 04 3405555 02 6264400 03 7669994 07 2274777 07 2227555 06 5687666

TOLL-FREE: 800 CBD (223) TEL: 04 2121000 FAX: 04 2121911 E-Mail: cbd-ho@cbd.ae Website: www.cbd.ae MANAGEMENT COMMITTEE Peter Baltussen Yaqoob Yousuf Hassan Ibrahim Abdulla Mahmoud Hadi Faisal Galadari Ahmed Shaheen HEADS OF DEPARTMENTS Stephen Davies Moukarram Attasi Frans Jan Burkens John Tuke V.P Bhatia Masood Azhar Amir Afzal Adel Al Sammak Kanan Iyer Alan Hill Abdul Rahim Al Nimr Badr Soueidan Nabil Tayyeb Mr. Mohamed Mardood Mr. Hassan Al Redha Akram Gharabeh Waleed Bin Suloom nels Jamal Saleh Salah Omer Rahmatulla Khan Nigel Foster Wafaii Tamimi REGIONAL MANAGERS Mr. Abdul Aziz Al Ansari Ibrahim Salama Othman Bin Hendi Region Alsayed Mohd. Al Hashimi Marwan Ibrahim Ahmed Al Aboodi

Chief Executive Deputy Chief Executive General Manager, Administration & Finance General Manager, Systems & Operations General Manager, Business Group General Manager, Credit & Risk Management Head of Corporate Banking Head of Asset Management Head of Consumer Banking Head of Treasury & ALM Head of Treasury Trading Head of Strategic Planning Department Head of Information Technology Head of Commercial Banking Head of Internal Audit Head of Treasury Sales Head of Wealth Management Head of Marketing Head of Islamic Banking Head of Central Operations Department Head of Financial Institutions Head of Financial Control Head of Personal Banking and Alt Banking ChanHead of Risk Management Head of Legal Services Head of Consumer Products Head of Human Resources Strategy Head of Recovery AGM, Sharjah Branch Regional Manager, Main Region Regional Manager, Abu Dhabi & New Dubai Regional Manager, Deira Region Regional Manager, Northern Emirates Region Regional Manager, Bur Dubai Region

Website: www.calyon.com Amr Alkabbani                         Regional Manager – Gulf      04 3317316 LudovicBernard-Maissa         RegionalCOO                                                                                    Eric Fromaget                          Head of Private Banking         04 3321300 Sebastian Van der List            Head of Corporate Banking – UAE      04 3315836 Naeem Khan                            Trade Finance          04 3291055 Albert Mondjian                       Head of Investment Banking – MEA    04 4284803   Abu Dhabi Al Muhairy Centre, Level 5              Tel:      02 6351100 Block C, Sheikh Zayed the First Street          Fax:     02 6344995 P.O.Box: 4725 Ghazi Abdul Fattah                  Branch Manager           02 6351991

Credit Suisse Abu Dhabi Dhabi Tower, 4th floor, Sheikh Hamdan Street P.O.Box 47060 Jean-Marc Suter Director

Tel 02 6275048 Fax 02 6274109

Dubai P.O. Box 33660 04 3620000 The Gate bldg, 9th Floor Fax 04 3620001 Dubai International Finance Centre ( DIFC), Dubai Head of Regional Office Beat Naegell

Deutsche Bank A G Abu Dhabi P.O.Box 52333 E-mail: jens.moeller@db.com Jens Moeller Representative

Tel 02 6333122 Fax 02 6322044

Dubai P.O. Box: 50490 Emirates Towers, Level 27b Fax 04 3199560 Karl French Director Tel : 04 3199514 Private Wealth Management - Asia Nadeem Masud Director Tel : 04 3199524 Global Markets Harris Irfan Vice President Tel : 04 3199520 Global Equities & Derivatives Rohit Johri Vice President Tel : 04 3199522 Private Wealth Management - Asia

Dresdner Bank AG

Coutts & Co.

Representative Office - Dubai Tel 04 2217007 Twin Towers, Baniyas Street, Deira Fax 04 2217006 P.O. Box 42220 Sarah Deaves CEO Sandra Shaw General Manager Martin Bond Private Banker

Calyon Corporate & Investment Bank

(Previously Crédit Agricole Indosuez & Crédit Lyonnais)   Dubai World Trade Centre, Level 32                            P.O.Box: 9256

Tel:      04 3314211 Fax:     04 3313201

Dubai Representative Office Burjuman Business Towers, 10th Floor, Office 1011 Bur Dubai, P.O. Box: 25654 Tel 04 3596444 Fax 04 3596116 E-mail: RepDubai@Dresdner-Bank.com Bashar A. Barakat

Chief Representative Regional Head GCC & Yemen

Dubai Bank Main Office Sheikh Zayed Road, Near Dubai World Trade Centre P.O. Box 65555, Dubai E-mail: info@dubaibank.ae Website: www.dubaibank.ae

Tel 04 3328989 Fax 04 3290071

History: Established in September 2002

BANKING AND BUSINESS REVIEW

May 2010

Ziad Makkawi

Chief Executive Officer

Dubai Islamic Bank Head Office Al Maktoum Street, Dubai P.O. Box 1080, Dubai Website: www.dib.ae. Email : contactus@dib.ae History: Established March 12, 1975 H.E. Mohammed Ebrahim Al Shaibani H.H. Khaled bin Zayed S. Al Nehayan Abdulla Al Hamli

Tel 04 2953000 Fax 04 2954111 Chairman Deputy Chairman CEO

Branches Dubai Deira Main Branch Bur Dubai Al Souk Ras Al Khor Al Twar Jumeirah Beach Residence Oud Metha Nad Al Hamar Jumeirah Abu Hail Abu Dhabi Airport Road, Abu Dhabi Al Salam Corniche Al Muroor Al Khalidiya Sharjah Sharjah Main Wasit Al Tawun Moweleh Al Nuaimiyah Al Ain Al An Main Al Ain Mall Ajman Ras Al Khaimah Khuzam, Ras Al Khaimah Fujairah Umm Al Quwain

04 2959999 04 3971717 04 2233300 04 3330060 04 2631000 04 4270400 04 3366313 04 2899551 04 3429955 04 2681818 02 6346600 02 6346600 02 6450555 02 6819300 02 4490007 02 6677119 06 5726444 06 5584455 06 5775500 06 5350222 06 7410333 03 7644111 03 7516555 06 7466555 07 2284888 07 2362666 09 2221550 06 7666630

El Nilein Bank Abu Dhabi P.O.Box 46013 Tel 02 6269995 Fax 02 6275551 Abdulla Mahmoud Awad Manager Tel 02 6720934 Mohamed Osman Salih Deputy Manager 02 6761916 Murlidhar G. Ramchandani Chief Accountant & Dealer 02-6729300 Ahmed Hillali Ahmed Head Investment Dept. & Credit 02-6729300

Abu Dhabi 02 6455151 Hameed Sheikh Manager Al Ain 03 7510055/77 Ghanim Al Hajeri Manager Al Maktoum Ali Malallah Manager Al Quoz Mohd. Abdulla Manager Baniyas Square Sherif Al Ulama Manager Bander Talib Fareed Aquilli Manager Dubai Main Branch Amal Al Qamzi Manager Fujairah 09 2222114/110 Yousif Al Marshoudi Manager Internet City 04 3910840/1 Balakrishnan Nair Manager Galleria Farida Al Balooshi Manager IBN Gardens 04 8844689 Hamdan Mohd. Abdulla Manager Jebel Ali Free Zone 04 8815551 Abdul Rahman Ibrahim Manager Karama Muna Al Falahi Manager Karama Shopping Complex Nawal Al Khader Manager Mankhool Abdul Rahim Abdulla Manager Qiyadah Fatima Al Midfa Manager Ghusais Fatima Al Midfa Manager Ramoul Ibrahim Hassan Manager Ras Al Khaimah 07 2272333 Khalifa Bin Kalban Manager Satwa Mohamed Bilal Manager Sharjah Industrial Area 06 5345577 Mohamed Al Shouq Manager Sharjah 06 5733300 Mahmoud Saif Manager Souk Samia Al Aqady Manager Umm Suqueim Nazia Kalban Manager Tower Saif Al Mansoori Manager World Trade Centre Abdulla Sulaij Al Falasi Manager Najdah 02 6771919 Butti Al Assiri Manager

Emirates Industrial Bank Emirates Bank International Dubai Main Branch, Baniyas Road, Deira Tel 04 2256900 P.O. Box 2923, Dubai Fax 04 2267718 Branches

64 BANKING AND BUSINESS REVIEW

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Abu Dhabi - Head Office Tel 02 6339700 P.O. Box 2722, Abu Dhabi Fax 02 6319191/6326397 E-mail: indbank@emirates.net.ae Dubai Tel 04 2211300 Arbift Tower, Deira P.O. Box 5454, Dubai Fax 04 2232320 E-mail: eibdubai@emirates.net.ae Website: www.emiratesindustrialbank.net Senior Management Personnel/Branch ManagerMohamed Abdulbaki Mohamed

General Manager Ahmed Mohamed Bakhit Khalfan Deputy General Manager Abdullah Rashed Omran Dubai Branch Manager Khalifa Al Falasi Acting Projects Division Manager Ali Ahmed Al Essa Development Services Division Manager Nasser Haji Malek Administration Manager Essa A. Bu Al Rougha Internal Audit Manager Mohamed Moneir Makled Finance Manager Salem Abu Baker Salem Acting Loans Division Manager

Emirates Islamic Bank P.O. Box: 6564, 2nd & 3rd Floor, Al Gurg Tower 1 Tel: 04 3160330 Plot 372 - Riggat Al Buteen, Deira, Dubai. Fax: 04 2272172 www.emiratesislamicbank.ae Ebrahim Fayez Al Shamsi CEO 04 3160330 Abdulla Showaiter (General manager – corporate and investment banking) Faisal Aqil General manager – retail banking Ahmed Fayez Alshamsi chief financial officer Syed Imran Bashir          Head of marketing and product development Samih Mohd Qadri Awadalla        head of branches Nasir Ahmed Khan                       head of consumer finance Zahir Mulla                                head of operations IMB (Main Branch) P.O. Box: 6564, Al Gurg Tower 2, Riggat Al Buteen, Dubai. BUD (Bur Dubai) P.O. Box: 6564, Khalid Bin Walid Road, Dubai. DFR (Diyafa) P.O. Box: 6564, Diyafa Road, Dubai. RIQ (Riqqa) P.O. Box: 6564, Omar Bin Al Khattab Street, Dubai. ADC (Abu Dhabi) P.O. Box: 46077, Sheikh Rashid Bin Saeed Al Maktoum Street, Abu Dbahi. ROS (Ras Al-Khaima) P.O. Box: 5198, 191 Oman Street, Al Nakeel, Ras Al Khaima. Fuj (Fujairah) P.O. Box: 1472, Sheikh Hamad Bin Abdulla Street, Fujairah. AJS (Al Ain) P.O. Box: 15095, Jawazat Street, Al Ain. QFS (Umm Al-Qaiwain) P.O. Box: 315, King Faisal Road, Umm Al Qaiwain. SBA (Sharjah) P.O. Box: 5169, Al Arooba Bank Street, Sharjah.

Finance House P.J.S.C. Mr. Mohammed Abdullah Jumaa Al Qubaisi

Chairman

Mr. Abdul Hamid Umer Taylor General Manager 02 6194998 Mr. T.K. Raman Chief Operating Officer 02 6194889 Mr. Mohammed Wassim Khayata Executive VP – Strategic Planning 02 6194445 Mr. Ramesh S. Mahalingam Chief Investments & Financial Officer 02 6194601 Mrs. Shagufta Farid Khan Head of Internal Audit 02 6194223 Ms. Lina Abdul Hamid I. El Araj Manager – General Services 02 6194702 Mr. Tarek Soubra Vice President – Central Operations 02 6194362 Ms. Maha Al Jamal Senior Manager – Marketing 02 6194893

First Gulf Bank Abu Dhabi Head Office, Sh. Zayed Second Street, Khalidiya P.O. Box 6316, Abu Dhabi Website: www.fbg.ae History: Established in 1979 Shareholder Equity of over AED 10 billion Senior Management Abdulhamid Mohammed Saeed Managing Director Andre’ Sayegh Chief Executive Officer Amit Wanchoo Head of Retail Banking Group Arif Shaikh Chief Credit & Risk Officer George Abraham Head of Corporate Banking Gopi Krishna Madhavan Head of Human Resources

Tel 02 6816666

02 6920502 02 6920506

Hana Al Rostamani Karim Karoui Nadeem A. Siddiqui Shafiqur Rehman Adhami Zafar Habib Khan Zulfiquar Ali Sulaiman

Strategic Planning Head Head of Business Planning & Financial Control Head of International Business SR. VP, CB FI\SYN\MNC\OIL & Energy Sector Chief Investment Officer Business Support Director

Habib Bank A.G. Zurich Head Office: Zurich, Switzerland Zonal Office: Dubai Tel 04 2214535 Baniyas Square Deira, P.O. Box 3306 Fax 04 2284211 E-mail: hbzcad@habibbank.com Website: www.habibbank.com History: Established in 1967 Reza S. Habib Joint President Arif Lakhani Chief Executive Vice President 04 2229985 Asad Habib Senior EVP Afzal Memon Senior EVP Shariq Ali Senior EVP Deira Mains 04 2214535 Najibullah Khan Branch Manager Farrukh Iqbal Deputy Branch Manager Corporate 04 3513777 Awais Hasan Branch Manager Sharjeel Vijdani Deputy Branch Manager Al Fahidi Street 04 3534545 Zain Ghazali Branch Manager Abdul Basheer Deputy Branch Manager Jebel Ali 04 8812828 Nisar Chowdhary Branch Manager Ifthikhar Memon Deputy Branch Manager Sh.Zayed Branch 04 3313999 Zia Abbas Mirza Branch Manager Kashif Aijaz Dodhy Deputy Branch Manager Abu Dhabi Sh. Hamdan Imamat Naqvi Area Manager Farhan Bakhshy Branch Manager Al Falah Syed Akhtar Hussain Branch Manager Raid Saleem Ansari Deputy Branch Manager Sharjah Al Boorj Avenue Younus Warsi Area Manager Kausarullah Khan Branch Manager

02 6346888 02 6422600 06 5730004

Habib Bank limited Abu Dhabi Tel 02 6224688 Main Branch, Corniche Road, P.O.Box 897, Abu Dhabi Fax 02 6225620 E-mail: hbl2003m@emirates.net.ae History: Established on August 25, 1941Nationalised on January 1, 1974 On June 1974 absorbed Habib Bank Ltd. On June 30, 1975 absorbed Standard Bank Ltd., Karachi Aman Aziz Siddiqi EVP/RGM 04 3597753 Mohammad Tanvir HR. Manager 04 3592292 Fouad Farrukh GRM 04 3592214 Sh. Abdul Basit AVP/CAD Manager 04 3592539 M. Amin Usman AVP/Treasury 04 3591893 Ahmed Faraz Faruqi VP/Head ICU 04 3592517 Nadeem Zia VP/Head FINCON 04 3592292 Syed Ali Gohar VP/IT/Head 04 3592820 Abdul Shahid Khan VP/Head Cops 04 3591874 Abu Dhabi

BANKING AND BUSINESS REVIEW

May 2010

Sh. Zayed Road, 2nd Street Mushtaq H. Shah Service Manager 02 6344557 Abu Dhabi Main Branch M. Saadat Cheema VP/Chief Manager 02 6224655 Al Ain 03 7642555 Abdul Jalil Al Fahim Bldg. Adbul Hameed Khan AVP/Senior Manager 03 7642555 Dubai Regional Office Sahibzada M. Taimur SVP/Corporate Manager 04 3596922 Sameera Mohammad Service Manager 04 3592016 Sheikh Zayed Road, Kalantar Tower Khalid Bin Shaheen SVP/Director 04 3431421 Mahdi Hassan Business Development Manager 04 3438081 Isar-Ul-Haq Service Manager 04 3438081 Deira Branch, Creek Road Zulfiqar Ahmad Bhatti Service Manager 04 2253292 Sharjah 06 5682552 / 5683473 Al Boorj Avenue Assad Ali Shaikh AVP/Branch Manager 06 5695122 Dhaid & Dibba 06 8822249 Near Al Dhaid Police Station 06 8822249 Abdul Sattar Badi Service Manager 06 8822249

HDFC Bank Representative Office: Dubai Juma Al Majid Bldg., Opp Bur Juman Centre P O Box 64546, Email: hdfcbank@emirates.net.ae Faisal Saeed Cheif Representative

Tel 04 3966991 Fax 04 3967010 Tel 04 3966991

HSBC Bank Middle East Ltd Regional Management Office Emaar Square, Sheikh Zayed Road, Dubai, P.O. Box 66 From outside the UAE Email : contactus.me@hsbc.com. www.hsbc.ae Simon Cooper Abdulfattah Sharaf Declan G Hegarty

Tel 600 55 4722 Fax 04 4267397 + 971 600 55 4722

Deputy Chairman & CEO, Middle East & N. Africa CEO, UAE Head of Business, Abu Dhabi

IndusInd Bank Dubai Representative Office Tel 04 3978803 203, Safa Commercial Bldg. Fax 04 3978805 Opp. Bur Juman Centre, P.O. Box: 111873, Dubai. E-mail: ibldubai@indusind.ae Pradeep Gupta Vice President & Chief Representative 04 3978804

ING Asia Private Bank Ltd Dubai Representative Office Tel 04 4277100 602, Level 6, Building 4 Fax 04 4257801 Burj Dubai Square Sheikh Zayed Road P.O Box 4296, Dubai â&#x20AC;&#x201C; UAE Suresh Nanda Managing Director & Head Eric Lorentz Managing Director Varun Bukshi Executive Director

66 BANKING AND BUSINESS REVIEW

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Melwyn Dias

Executive Director

B.R. Subramanian P.G. Bhaskar Ranjit Paul Piyush Bhandari Nitin Bhatnagar Rishi Chauhan Asad Dadarkar Ashraf Al Yamani

Director Director Director Director Director Director Director Director

InvestBank Sharjah Tel 06 5694440 Al Boorj Avenue, P.O. Box 1885 Fax 06-5694442 E-mail: sharjah@invest-bank.com Website: www.invest-bank.com History: Established on 2nd February 1975 as Investment Bank for Trade & Finance On July 1, 1995 name changed to Investbank. Sami Farhat General Manager Qasim Kazmi AGM. Operations & Treasury Taleb Zaarour Senior Manager-ADM & Legal Athar Anis Manager, Credit Risk Bassam Hollmerus Chief Dealer Sajjad H. Holimerus Trade Finance Madhu Pilakazhi Financial Controller Ghassan Accari Personnel Manager Vinay Gupta IT Manager Dubai 04 3213131 Sheikh Zayed Road 04 2285551 Dubai Al Maktoum Street 03 7644446 Al Ain Al Ghaba Street Abu Dhabi 02 6794594 Sh. Khalifa street Abu Dhabi 02 5555336 Mussaffa Area Sharjah 06 5420333 Industrial Area

Janata Bank Abu Dhabi Obied Sayah Al-Mansuri Building Tel No 02-6331400 Electra Road, Post Box No. 2630 Fax : 02-6348749 Email jbadas@emirates.net.ae Mr. Md. Masuduzzaman Chief Executive 02-6344543 Mr. Md. Chaynul Haque IT Manager/SPO 02-6340881 Mr. Md. Ramjan Bahar System Administrator/PO 02-6340881 Abu Dhabi Mr. Mohamudul Hoque Manager 0 2-6344542 Dubai Mr. Md. Abdul Awal Manager Mohammad Saleh Al-Gurg Building 0 4-2281442 Al-Borj Street, P.O. Box 3342 Mr. Md. Mizanur Rahman Manager Sharjah Saqer Bin Rashid Al Quassim Building Al Suwaiheen Street, P.O. Box- 5303 0 6-5687032 Mr. Md. Mizanur Rahman Manager Al Ain Branch Mr. Md Shahadat Hossain Manager Sk. Khalifa Bin Mohd. Al-Nahyan Building, Main Market Centre, Main Street, P.O. Box- 1107 0 3-7513425

Lloyds TSB Bank plc Dubai Main Branch Al Wasl Road, Opp. Safa Park Tel 04 3422000 P.O. Box: 3766, Dubai, UAE Fax 04 3422660 E-mail: information@lloydstsb.ae Website: www.lloydstsb.ae Vivek Vohra Head of Corporate Origination Giles Cunningham Regional Manager, UAE & Gulf States 04 3023267 Bert de Ruiter Managing Director 04 3023267 Steve Williams Consumer Banking Director 04 3023267 Jon Mortell Head of Corporate Banking 04 3023266 Suresh Jadhwani Treasury Manager 04 3023256 Tim Goddard Head of Operations and IT 04 3023250 Derek Vaz Head of Finance and Planning 04 3023330 Caroline Ridley HR Manager 04 3023270 Steve Snowdonâ&#x20AC;Ż Head of Middle Office Alex de Melo Head of Treasury Trading Edson Suppo Head of Treasury Strategy & Risk Claire Thomas Head of Human Resources Dubai Customer Service Centres Community Centre at Arabian Ranches, Dubai Dubai Healthcare City (Behind Wafi City)

Tel 04 3023318 Fax 04 3618035 Tel 04 3023349 Fax 04 3624805

Man Investments Middle East Limited Representative Office Dubai Tel 04 3604999 Level 5, West Wing, The Gate, Dubai Internaional Financial Centre Fax 04 3604900 P.O. Box: 73221, Dubai Website: www.maninvestments.com E-mail: ManDubai@maninvestments.com Patrik Merville Chief Executive Officer Kamlesh Bhatia Deputy Chief Executive Officer

Mashreqbank Dubai Tel 04 2223333 Head Office, Omar Bin Al Khatab Street, Deira Fax 04 2226061 P.O. Box 1250, Dubai History: Established on 1st May, 1967 as Bank of Oman Limited. On October 1st 1993 name was changed to MashreqBank PSC. bdullah Al Ghurair President and Chairman Abdul Aziz Al Ghurair CEO Ali Raza Khan Head of Corporate Affairs Douglas Beckett Head of Retail Banking Omar Bouhadiba Head of Investment and Corporate Banking Nabeel Waheed Head of Treasury and Capital Markets Nigel Morgan Head of Audit Review & Compliance Majid Husain Head of Financial Institutions Somnath Menon Head of Operations & Technology Kantic DasGupta Head of Risk Management Alexander Sinclair Head of Technology Mubashar Khokhar CEO of Badr Al Islami Ebrahim Kazi Head of Marketing and Corporate Communications Saad Hakim Events and Public Relations Manager Al Khaleej Street, Deira 04 2717771 Souq Al Kabir Branch 04 2264176 Hor Al Anz, Deira 04 2623100 Jumeirah Branch 04 3441600 Jebel Ali 04 8815355 Khor Branch 04 3534000 Bur Juman Centre 04 3527103 Al Riqa, Deira 04 2229131

Al Aweer 04 3333727 Abu Dhabi 02 6274300 Main Branch, Khalifa Street Musaffa 02 5555051 Zayed the 2nd Street 02 6334021 Al Salam Street 02 6786500 Al Mushrif 02 4432424 Baniyas 02 5821100 Muroor 02 4481858 Khalidiya 02 6665757 Al Ain 03 7667700 Al Ain Main Street Ali Ibn Abi Tailb St. 03 7669968 Ajman 06 7422440 Shk Humaid Bin Abdul Aziz Street, Near Ajman Museum 09 2221100 Fujairah Sh. Hamad Street 07 2361644 Ras Al Khaimah King Faisal Street. Al Nakheel RAK 07 2281695 Sharjah Main 06 5684366 Bank Street, Rolla King Abdul Aziz Street 06 5730883 Dhaid 06 8822899 Main Street, Sh. Arsan Hameed Bldg., Dhaid Dibba 09 2444230 Kalba 09 2777430 Kalba City Khorfakkan 09 2385295 Umm Al Quwain 06 7666948 King Faisal Street, Next to New Souk

Merill Lynch International & Co.C.V Representative Office Dubai (04) 3975555 Business Center Building, Khalid Bin Walid Street P.O. Box 3911, Dubai Telefax Executive Director

04-3975252 Mones Bazzy

NATIXIS Dubai Branch DIFC Gate Village Building No. 8, 5th Floor P.O Box 33770 Email: natixis@emirates.net.ae Website: www.natixis.fr Philippe Petitgas CEO

Tel 04 7026777 Fax 04 7026820

National Bank of Abu Dhabi Head Office: Abu Dhabi 02 - 6111111 One NBAD Tower, Khalifa St., P.O. Box 4, Abu Dhabi Telex 22266/7 MASRIP EM History: Established in 1968 H.E. KHALIFA MOHAMED AL KINDI Chairman H.E. DR. JAUAN SALEM AL DHAHIRI Deputy Chairman MICHAEL H. TOMALIN Chief Executive ABDULLA MOHAMMED SALEH ABDULRAHEEM GM & Chief Operating Officer SAIF ALI MOHAMED MUNAKHAS AL SHEHHI GM Domestic Banking Division QAMBER ALI AL MULLA GM International Banking Division ABHIJIT CHOUDHURY GM & Chief Risk Officer JOHN GARRETT GM & Chief Audit & Compliance Officer

BANKING AND BUSINESS REVIEW

May 2010

Abu Dhabi Main Branch Khalidiya Dept. of Social Services & Commercial Buildings ADCO ADMA ADNOC Abu Dhabi Municipality NPCC ZADCO HILTON Abu Dhabi International Airport Sheikh Rashed Bin Saeed Al Maktoum Road Abu Dhabi Mall Arabian Gulf Road Baniyas Bateen Between The Two Bridges Area Corniche Dalma Island TAMM Das Island Liwa Madinat Zayed Government Complex Al Mirfaa Al Ruwais Al Muroor Mussafah Dept. of Social Services & Commercial Buildings (Mussafah) Mussafah Municipality Industrial City of Abu Dhabi Al Salam St. Al Shahama New Al Shahama Abu Dhabi Municipality-Shahama Sweihan Marina Mall Al Etihad Emirates Palace National Exhibition Centre Mina Road

02 - 6111111 02 - 6666800 02 - 6346673 02 - 6672642 02 - 6263225 02 - 6669143 02 - 6744749 02 - 5549282 02 - 6768821 02 - 6812280 02 - 5757303 02 - 6419800 02 - 6452200 02 - 4478878 02 - 5831625 02 - 6658332 02 - 5589446 02 - 6220300 02 - 8781240 02 - 8945528 02 - 8731099 02 - 8822388 02 - 8846146 02 - 8945428 02 - 8836506 02 - 8776343 02 - 4481918 02 - 5553357 02 - 5520681 02 - 5540300 02 - 5501125 02 - 6442900 02 - 5632411 02 - 5635695 02 - 5631385 03 - 7347919 02 - 6816002 02 - 6111111 02 - 6908900 02 - 4494996 02 - 6767665

Al Alin Al Ain Clock Tower Al Ain Al Ain Cement Factory Al Ain International Airport Al Ain Defence Al Sanaiya Al Hayer Al Ain Mall

03 - 7642400 03 - 7516900 03 - 7828060 03 - 7855511 03 - 7688824 03 - 7213222 02 - 7322400 03 - 7519900

Ajman Ajman

06 - 7422996

Dubai Deira Dubai Side Jebel Ali Sh. Zayed Road Al Qusais Jumeirah Mall of the Emirates

04 - 2226141 04 - 3599111 04 - 8815655 04 - 3433311 04 - 2674176 04 - 3499001 04 - 3413888

Fujairah Fujairah Dibba

68 BANKING AND BUSINESS REVIEW

09 - 2222458 09 - 2444223

May 2010

Ras Al Khaimah Al Nakheel Ras Al Khaimah

07 - 2281753 07 - 2334333

Sharjah Al Bourj Avenue Sharjah Al Falah Camp Office Al Dhaid Khorfakkan Kalba

06 - 5695500 06 - 5721111 06 - 5385969 06 - 8822929 09 - 2385250 09 - 2772112

Umm Al Quwain Umm Al Quwain

06 - 7660033

National Bank of Bahrain Abu Dhabi Khalaf Bin Ahmed Al Otaiba Building, Sh. Hamdan Street P.O.Box 46080 Email: nbbbr96@emirates.net.ae Website: www.nbbonline.com Farouk Khalaf Ingersoll Ramalingam

UAE Country Manager Manager Credit

Tel 02 6335288 Fax 02 6333783

02 6335299 02 6311248

National Bank of Dubai Dubai Tel 04 2222111 Head Office Baniyas Street, Deira Fax 04 2283000 P.O. Box 777 Email: contactus@nbd.co.ae Website: www.nbd.com History: Established in1963 as National Bank of Dubai Limited. In 1994 name was changed to National Bank of Dubai. R. Douglas Dowie Joyshil Mitter Alex Richardson Leslic Rice Abdul Shakoor Tahlak Ghanim Bin Zaal Ali Al Najjar Suvo Sarkar Rajesh Thaper Faranak Foroughi Husam Al Sayad G. Krishnamoorthy Sue Evans Alan M. Smith A. Chandran Walid El Masri Rashmi Malik Abdul Fattah Sharaf Mohamed Al Neaimi Ali Kaitoob P.S. Sastry Hesham Qassimi

CEO CFO COO CRO CM - Intl. CM - Business Development CM - Liability Head of Retail Head Of Corporate Head of TPO Head of HR Treasurer Head of IS&T Head of Group Audit Head of BPQM Head of Corp Comm Head of Strategy GM NFS GM Aqarat Head of Dist. Retail SM CEOâ&#x20AC;&#x2122;s Office Divisional Manager Corporate Banking

Abu Dhabi P.O. Box: 386 Ajman P.O. Box: 712 Ajman Archives Al Mizhar

Tel : 02 6394555 Tel : 06 7456555 Tel : 06 7444606 Tel : 04 2641221

Fax : 02 6346767 Fax : 06 7456060 Fax : 06 7425883 Fax : 04 2640569

Al Ain P.O. Box: 16122 Burjuman Centre Bullion Convention Centre Branch Dubai Central Fruit & Vgtbl. Mkt Branch Al Awir Dubai International Airport Dubai International Airport Pay Office Dubai Internation Airport Dubai Internation Airport Dubai Internation Airport Dubai Internation Airport Dubai Internation Airport Dubai Media City Pay Office Deira City Centre Dubai Airline Centre Dubai Airport Free Zone Dubai Courts Dubai Media City Pay Office Emirates Tower Fahidi Emirates Tower Emirates Tower Fahidi Direct Banking Fujairah Branch P.O. Box: 1744 Hamriya Hatta Ibn Battuta Mall Branch Ittihad Road Jumeirah Branch Jebel Ali Main Office Maktoom Branch Malleq Emirates Branch Muhaissnah Branch Nadd Al Shiba Oud Metha Branch (Ex-Gulf Tower Branch) Ras Al Kaimah P.O. Box : 1932 Rashidiya Souk Madinat Jumeirah Branch Sh. Zayed Road (Saeed Tower) Sharjah P.O. Box : 21850 Umm Al Quwain P.O. Box : 22 Emirates Tower Umm Suqeim

Tel : 03 7644345 Tel : 04 3555222 Tel : 04 2284757 Tel : 04 3320808 Tel : 04 3333880 Tel : 04 2200404 Tel : 04 2164946 Tel : 04 2162450 Tel : 04 2166995 Tel : 04 2162452 Tel : 04 2162434 Tel : 04 2162740 Tel : 04 3902007 Tel : 04 2951555 Tel : 04 2952555 Tel : 04 2995550 Tel : 04 3366702 Tel : 04 3030400 Tel : 04 3300133 Tel : 04 3535575 Tel : 04 3530308 Tel : 04 2823400 Tel : 04 3532840 Tel : 09 2233335 Tel : 04 2663189 Tel : 04 8523183 Tel : 04 3685499 Tel : 04 2955600 Tel : 04 3420202 Tel : 04 8816087 Tel : 04 2222111 Tel : 04 2281141 Tel : 04 3410777 Tel : 04 2544545 Tel : 04 3363939 Tel : 04 3370222 Tel : 07 2279888 Tel : 04 2859523 Tel : 04 3686130 Tel : 04 3313183 Tel : 06 5738888 Tel : 06 7656154 Tel : 06 7656152 Tel : 04 3485222

Fax : 03 7668515 Fax : 04 3554455 Fax : 04 2289090 Fax : 04 3320908 Fax : 04 3333870 Fax : 04 2244614 Fax : 04 2244614 Fax : 04 2244614 Fax : 04 2244614 Fax : 04 2244614 Fax : 04 2244614 Fax : 04 2244614 Fax : 04 3908855 Fax : 04 2951525 Fax : 04 2955655 Fax : 04 2995557 Fax : 04 3353906 Fax : 04 3908855 Fax : 04 3300155 Fax : 04 3535575 Fax : 04 3534601 Fax : 04 2823640 Fax : 04 3531443 Fax : 09 2233336 Fax : 04 2690103 Fax : 04 8521051 Fax : 04 3685501 Fax : 04 2955611 Fax : 04 3421112 Fax : 04 8816961 Fax : 04 2283000 Fax : 04 2235456 Fax : 04 3410707 Fax : 04 2544646 Fax : 04 3363788 Fax : 04 3366145 Fax : 07 2279889 Fax : 04 2854847 Fax : 04 3686195 Fax : 04 3310629 Fax : 06 5733000 Fax : 06 7655151 Fax : 04 3300155 Fax : 04 3482535

National Bank of Oman Abu Dhabi Bin Sagar Towers, Najda Street Tel 02 6348111 / 6323456 P.O. Box 3822 Fax 02 6325027 Ravi S. Khot Country Manager 02 6393028 Salim Al Khanjri Manager - Operations 02 6392535 Minhajuddin Niazi Manager - Consumer Banking & Business Development 02 6326560 K.K. Gambhir Manager - Corporate Banking 02 6394922

National Bank of Umm Al Qaiwain

P.O.Box 800, Umm Al Qaiwain Falaj Al Mualla Branch NBQ Building, Shaikh Zayed Street P.O.Box 11074 Falaj Al Mualla Dubai Branches NBQ Building, Khalid Bin Al Waleed Street P.O. Box 9715 Dubai  Deira Branch Opposite Dubai Police Head Quaiter Al Ittihad Street, P.O. Box 8898 Deira, Abu Dhabi Branch Hamdan Bin Mohammed Street (# 5) P.O. Box 3915 Abu Dhabi  Mussafah Branch P.O. Box 9770 Abu Dhabi Al Ain Branch Oud Al Touba Street Al Mandoos Roundabout P.O. Box 17888 Al Ain Sharjah Branch King Faisal Street, P.O.Box 23000 Sharjah NBQ Kiosk Sharjah Mega Mall P.O.Box 23000 Sharjah Ajman Branches City Center Branch Ajman City Center P.O.Box 4133 Ajman Masfout Branch NBQ Building Main Street P.O.Box 12550 Masfout, Ajman Fujairah Branch Fujairah Insurance Co. Building Hamad Bin Abdulla Road P.O.Box 1444 Fujairah Ras Al Khaimah Branch Corniche Al Qawasim Road P.O.Box 32253 Ras Al Khaimah

Managing Director General Manager

Umm Al Qaiwain Branch NBQ Building, King Faisal Street

Tel: 06 7066666 Fax: 06 706 6677

Tel: 04 3976655 Fax: 04 3975382 Tel: 04 2651222 Fax: 04 2651333 Tel: 02 6775100 Fax: 02 6779644 Tel: 02 5555088 Fax: 02 5553559 Tel: 03 3751300 Fax: 03 7513500 Tel: 06 5742000 Fax: 06 5742200 Fax: 06 5742200

Tel: 06 7436000 Fax: 06 7436060 Tel: 04 8523377 Fax: 04 8523093 Tel: 09 2232100 Fax: 09 2232220 Tel: 07 2366444 Fax: 07 2364470

Philippine National Bank Dubai Representative Office Room 108, Al Nakheel Bldg., Zabeel Road, Karama Tel 04 3365940 P.O. Box 52357, Dubai, UAE Fax 04 3374474 E-mail: pnbdxb@emirates.net.ae Amroussi Tillah Rasul First Vice President & Regional Representative

Rafidain Bank

Abu Dhabi Al Nasser Street, Glass Bldg. P.O.Box 2727, Abu Dhabi Salah Mahid Branch Manager

History: Established in 1982 24/7 Call Centre Number: 600 56 56 56 E-mail: nbuq@nbq.ae Website: www.nbq.ae Sh. Nasser Bin Rashid Al-Moalla Mohamed Abdel Rahim Al Mulla

Tel: 06 8824447 Fax: 06 8824445

Tel 02 6335882 / 3 Fax 6326996

Royal Bank of Canada

Dubai Representative Office API World Tower, Suite 1002, Shk. Zayed Road, P.O. Box: 3614. Umaima Zaman senior manager Ashwani.k.Dewitt senior manager Global Private Banking Ashish Anand Chief Representative

BANKING AND BUSINESS REVIEW

Tel 04 3313196 Telefax 04 3313960

May 2010

RAK Bank Ras Al Khaimah Head Office, Oman Street, Al Nakheel Tel 07 2281127 P.O. Box 5300 Fax 07 2283238 E-mail: nbrakho@emirates.net.ae; www.rakbank.ae History: Established in 1976 as The National Bank of Ras Al Khaimah. In 2003, name was changed to RAKBANK H.E. Sheikh Omar Bin Saqr Al Qasimi H.E. Sheikh Salim Bin Sultan-Al-Qasimi Mr. Hamad Abdulaziz Al Sagar Mr. Essa Ahmed Abu Shuraija Al Neaimi Mr. Majid Saif Al Ghurair Mr. Ali Samir Al Shihabi Mr. Yousuf Obaid Essa Mr. Graham Honeybill Mr. Ian Hodges Mr. Anil Sukhia Mr. Steve O Hanlon Mr. Kunal Chowdry Mr. Jose Braganza Mr. Malcolm D’Souza Mr. Ramakrishna K S Mrs. Susan Gardner Mr. Dharmesh Pandya Dubai Deira Maktoum Branch Gold Souk Branch Umm Hurair Branch (Bur Dubai) Oud Metha ( Dubai Main Branch) Sheikh Zayed Road Branch Emaar Business Park Branch Marina Diamond Branch Al Quoz Branch Ibn Battuta Mall Branch Mirdiff Branch Al Qusais Branch Sharjah Sharjah Main Branch Sharjah Industrial Area Ajman Ajman Branch East Coast Kalba Branch Khorafakkan Branch Al Ain Al Ain Branch Abu Dhabi Abu Dhabi-Tourist Club Branch Khalidiya Branch Mussafah Branch Ras Al Khaimah RAK Town Branch Sha’am Branch Badr Branch Al Manael Branch Al Rams Branch Al Dhait Branch Al Nakheel Branch

Chairman Director Director Director Director Director Director General Manager Head of Personal Banking Head of Corporate Banking Chief Operating Officer Head of Internal Controls Head of Credit Head of Treasury Head of Audit Head of Human Resources Head of Finance Tel : 04-2248000 Tel : 04-2248000 Tel : 04-2248000 Tel : 04-2248000 Tel : 04-2248000 Tel : 04-2248000 Tel : 04-2248000 Tel : 04-2248000 Tel : 04-2248000 Tel : 04-2248000 Tel : 04-2248000 Tel : 06-5988020 Tel : 06-5988200 Tel : 06-5988266 Tel : 09-2039500 Tel : 09-2039550 Tel : 03-7029000 Tel : 02-4127100 Tel : 02-4127600 Tel : 02-4127300 Tel : 07-2062211 Tel : 07-2062333 Tel : 07-2062411 Tel : 04-2913964 Tel : 07-2062366 Tel : 07-2062266 Tel : 07-2062222

The Royal Bank of Scotland N.V. Head Office: Edinburgh, United Kingdom Dubai Branch,

70 BANKING AND BUSINESS REVIEW

May 2010

Regional Hub for UAE and Middle East P.O. Box: 2567, Khalid bin Waleed Street, Dubai, UAE Phone Banking: Dubai Branch: Simon Penney Country Executive Burhan Khan Head of Regional Markets

Tel: 04 3512200 Fax: 04 3511555 04 4266000

Abu Dhabi Corner of Hamdan and Salam Streets P.O. Box: 2720, Abu Dhabi, United Arab Emirates

Tel: 02 6963000 Fax: 02 6963001

Sharjah Abdul Aziz Al Majid Building, King Faisal Street P.O. Box: 1971, Sharjah, United Arab Emirates

Tel: 06 5594900 Fax: 02 6963001

04 5062601 04 5062801

Sharjah Islamic Bank Mohammed Abdalla Chief Executive Officer Ahmed Saad ibrahim Chief Operating Officer Mohammed Rizwan Chief Risk Officer Saeed M Ahmed Al Amiri Head, Investment Group Ossama Salah El Din Head, Retail Banking G . Ramkirshinan Head of Coroprate Banking Group Hussam A. Abu Aisheh SVP-Chief Internal Audit Mohammed Ishaq Chief Dealer Mohamed Azmeer Head of Credit Division Eman Jasim Sajwani Head of Human Resources Group Myron Britto Head, nformation Technology Div.-CIO Sufyan Maysara Head of Shariaa Supervision Divison Branches Main Branch - Al Brooj Avenue Mohammed Yousif King Faisal Street Branch Abdul Salam Al Ali Ladies Branch Laila Ali Salem American Unversity Branch Mohd Mousa Ali Al Dhaid Branch Khalid M. Ajmani Industrial Area Branch Waleed Abdul Qadir Sharjah Expo Branch Jassim Al Awadi Sharjah Buhaira Branch Osama Ahmed AlSalman Khorfakhan Branch Yousif M. Abdullah Dibba Branch Ali Al-Abdouli Kalba Branch Abdullah Bin Hikal Fujairah Branch Nawal Mohamed AlMaghribi Dubai Branch Mohamed Ibrahim Alghufili Sheikh Zayed Branch Maisoon Zainudin Al Twar Branch Maha AlBanna Abu Dhabi Branch Thomas P.Y. Al Ain Branch Majid Sha’abaan

06-5115116 06-5115118 06-5115172 06-5115000 06-5115339 06-5115111 06-5115153 06-5115151 06-5115319 06-5115170 06-5115444 06-5115213 06-5115121 06-5746805 06-5746807 06-5585789 06-8829414 06-5397623 06-5992502 N/A 09-2387490 09-2442601 09-2774204 09-2244339 04-2698322 04-3217543 04-2638335 02-6224166 03-7513200

Shuaa Capital PSC Head Office Tel: 04 3303600/ 04 3199778 Emirates Towers Hotel, Level 7 Fax: 04 3303550 P.O. Box: 31045, Dubai, UAE. Website: www.shuaacapital.com Iyad Duwaji CEO Abeer Ayash Marketing and PR coordinator

Societe Generale Dubai DIFC Gate Village, Bldg. 6, 4th Floor Sheikh Zayed Road, Dubai

Tel.: 04 4257500 Fax: 04 3653170

Website: www.socgen.com Alain L. Tave

Roger Leitner

Chief Regional Representative

Dubai Creek Tower, Office 17A, Baniyas Road, Deira Peter Schaer Senior Representative

Standard Bank Plc - Dubai Branch (DIFC) Dubai Emirates Tower, Office-16 B Tel 04 3300011 P.O. Box 504904 Fax 04 3300169 Website: www.standardbank.com Jeffrey Rhodes General Manager 04 3300164 Kate Lunjevich Head of Compliance & Operations

DIFC Gate Village, Bldg. No. 6, 5th Floor Sheikh Zayed Road P.O Box 506542 Per Larsson Senior Representative

04 2240044 04 2220006 Tel.: 04 3657150 Fax: 04 3657191

Union National Bank

Standard Chartered Bank Head Office: United Kingdom Dubai Main Branch Tel 04 3520455 Head Office: Al Fardan Building, Fax 04 3528648 Mankhool Road, Bur Dubai P.O. Box: 999, Dubai - United Arab Emirates www.standardchartered.ae Phone Banking: 600 522 288 (24 hours) Dubai Branch P. O. Box 999, Al Mankool Road, Dubai , UAE 04-3520455 Deira Branch P. O. Box 1125, Baniyas Square, Dubai, 04-5085300 Al Ras Souq Branch P. O. Box 64555, Al Ras Souq, Dubai , UAE 04-5085366 Dubai Mall Branch P. O. Box 127899, LG level, Dubai, UAE 04-5085753 Emaar Business Park Branch P. O. Box 103669,Building 3, Dubai, UAE 04-5085255 Jebel Ali Branch P. O. Box 16920 , Downtown Jebel Ali, Dubai , UAE 04-5085200 Dragon Mart Branch P. O. Box 4166, Dragon Mart mall, Dubai, UAE 04-5085260 Al Ain Branch P. O. Box 1240, Near Clock Tower, Al Ain, UAE 03-7056800 Khalidiya Branch P. O. Box 241, Crystal Tower, Abu Dhabi, UAE 02-6165600 Sharjah Branch P. O. Box 5, Al Boorj Avenue, Sharjah , UAE 06-5916100

The Housing Bank for Trade & Finance Abu Dhabi P.O. Box 44768 Muhanad Habashneh Representative

Senior Representative

Tel 02 6268855/6270280 Fax 02 6271771

Abu Dhabi Head Office, Salam Street, P.O.Box 3865, Abu Dhabi Website: www.unb.ae History: Established as a Public Joint Stock Company in 1982 Nahyan Bin Mubarak Al Nahyan Chairman Mohammad Nasr Abdeen Chief Executive Officer Abu Dhabi Corniche City Centre Najda Hazzaa Khalidiya Adgas Booth Musaffah Shahama Baneyas Al Dhafra/Madinat Zayed Al Muroor Al Ain Sh. Khalifa Street Al Jimi Dubai Main Branch, Deira Al Maktoum Street Khalid Bin Al Waleed Road Al Bustan Jebel Ali Sheikh Zayed Road/Jumeira Rashidiya

Tel 02 6741600 Fax 02 6786080

Ajman Central - Emirates Post Fujairah Ras Al Khaimah Sharjah King Abdul Aziz

02 632 1600 02 627 3471 02 632 4981 02 641 2288 02 635 2511 02 627 0611 02 555 9111 02 563 4600 02 582 1886 08 884 8484 02 444 8384 03 7644551 03 7626240 04 2211188 04 2232266 04 3516444 04 2636388 04 8810999 04 3329911 04 2857686 06 7425552 09 2222747 07 2286600 06 5686141 06 5746161

United Arab Bank

Union de Banques Arabes et Francaises UBAF Dubai Creek Tower, Baniyas Road, Deira Tel 04 2284080 P.O. Box 29885 Fax 04 2284070 Hamed Hassouna Chief Representative GCC & Yemen

Bertrand Giraud Awni Alami Gibert Hie Arif Premdjee

UBS AG Abu Dhabi ADNIC Bldg., 5th Floor, Sh. Khalifa Street P.O.Box 3744 Website: www.ubs.com

General Management & H.O. Tel 06 5733900 Sh. Abdulla Bin Salim Al Qassimi Building, Al Qasimia St., Sharjah Fax 06 5733906 E-Mail Address uarbae@emirates.net.ae Website www.uab.ae History: Established 1975 General Manager Dy. General Manager Asst. GM-Corporate & Retail Asst. GM-Admin. & Finance

06 5733900 06 5733900 06 5733900 06 5733900

Tel 02 6275024 Fax 02 6272752

BANKING AND BUSINESS REVIEW

May 2010

United Bank Limited Dubai Gargosh Bldg, Khalid Bin Waleed Street P.O. Box 1367, Dubai Email: ublgmuae@emirates.net.ae Website: www.ubl.com.pk Wajahat Husain Head of Middle East Maruf Ahmed General Manager UAE

64 BANKING AND BUSINESS REVIEW

Wachovia Bank National Assoc. Tel 04 3552020 Fax 04 3514525

May 2010

Representative Office Dubai The Atrium Centre, Khalid Bin Waleed Street, Bur Dubai 04 3556244 P.O. Box 53089 Fax 3557117 Head Office: USA J.Kennedy Thompson Chairman & Chief Executive Officer Michael P. Heavener International Division Dubai Branch: Chafic Haddad Vice President & Regional Manager Carol Hampson Customer Services Representative