Tuesday, OcTOber 28, 2014 khaleej times
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Global capital of islamic economy Several heads of government and delegates from over 100 countries will attend the 10th WIEF in Dubai
T
he 10th World Islamic Economic Forum (WIEF), which is being held under the patronage of His Highness Shaikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, will be attended by more than 2,000 participants from over 100 countries. The three-day event will run until October 30. “We are happy to welcome all the WIEF delegates to Dubai. The
wide international representation, especially the presence of so many heads of government, economic experts and stakeholders, will make the 10th WIEF a definitive platform of innovative partnerships. Over the next few days, we look forward to a period of highly creative engagement on the Islamic economy that will benefit the delegates as well as the countries they represent, and enhance the position of Dubai as an Islamic economy hub,” said Abdulrahman
making inroads into the mainstream
Abdulrahman Saif Al Ghurair,Chairman, DCCI
Serving the UAE for almost four decades, Dubai Islamic Bank has pioneered a number of products and services that suits the banking and financial needs of its clients. The bank has constantly improvised its offerings, and reached out to a wide population. In an exclusive chat with Khaleej Times, Dr Adnan Chilwan, CEO, Dubai Islamic Bank, talks about the Islamic banking and finance industry, the importance of the World Islamic Economic Forum in Dubai and much more. Excerpts: give us a perspective of islamic banking in the Uae, and also tell us about its contribution to the nominal gdP of the Uae?
Musa bin Hitam, Chairman, WIEF
Saif Al Ghurair, Chairman of Dubai Chamber of Commerce and Industry (DCCI) and Board Member of the Dubai Islamic Economy Development Centre. Musa bin Hitam, Chairman of WIEF Foundation, said: “Dubai complements the forum very well with its massive pool of business community, world-class infrastructure, and its strategic location connecting the east and the west. The 10th edition in Dubai has gathered nine heads of state, 12 ministers, four Central Bank governors, 181 role-players, and about 2,000 delegates from more than 100 countries. We definitely look forward to a successful forum.” Bearing the theme, ‘Innovative Partnerships for Economic Growth’, it serves to promote more cross-border and cross-industry collaborations through a series of thought-provoking discussions and robust networking sessions.
The UAE has been a pioneer within the Islamic banking industry. Ever since the establishment of Dubai Islamic Bank (DIB) in the 1970s, the industry has constantly grown over the past few decades. To date, it is estimated that Islamic banking in the UAE constitutes around 18 per cent of the total banking asset of Dh2 trillion as of 2013. The competitive landscape is heating up with several Islamic banks offering a diverse range of Shariahcompliant products and services across various sectors ranging from retail to wholesale to specialised products such as Takaful. In 2013, the UAE’s nominal GDP estimated at $400 billion was up by 5 per cent from the previous year. Islamic finance has been a strong contributor to the overall economic growth. For instance in 2013 a number of landmark capital market transactions were initiated where Islamic finance was involved: the Emirates Airlines $1 billion sukuk and the Dubai $750 million sovereign sukuk, both issues being extremely successful. On the consumer side, the UAEbased Islamic banks continue to penetrate the market through innovative Shariah-compliant products across a broad spectrum of retail services. Moving forward with the government’s initiative to establish Dubai as a Capital of the Global Islamic Economy, Islamic finance and DIB are set to expand further, boosted by the anticipated growth in the overall UAE economy.
segment with over 90 services related to banking and e-government including settlements with DeG (Dubai Smart Government), DED (Department of Economic Development), and Dubai Trade though direct connectivity with these key entities. Our foreign exchange cash service at Dubai International Airport is another step in our focused strategy of expanding touch points in the expat-populated areas. the islamic development Bank (idB) recently listed $1-billion sukuk in dubai nasdaq. What is the significance of this event? This is another clear testament to Dubai’s unique positioning as being the critical pillar of the global Islamic economy. The infrastructure supporting the initiative of His Highness Shaikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, is in place and institutions like IDB are now recognising the same. Simultaneously, such events will trigger stronger ties with IDB’s member states and further strengthen trade and related activities between them and the UAE. since the financial crisis of 2008, globally people are looking at islamic banking and finance as the rightful alternatives. What are your views on this? Right at the onset, I want to clarify that Islamic banking caters to all segments of banking and finance and not just to the niche Muslim population, which is sometimes
Dr Adnan Chilwan, CEO, Dubai Islamic Bank
mies of scale that conventional players enjoy. That said, over the last decade or so, the sector has grown at nearly twice the rate of the conventional one and is set to become a far more significant force. Innovation has also been a major challenge, particularly with certain products that have key reliance on interest-based lending. We, at DIB, have made huge inroads in terms of working with Shariah scholars to develop high quality, competitive and easy to use products to our growing clientele, thereby plugging any significant gaps in our product suite across consumer and wholesale. However, there are still areas particularly around liquidity management and trade that Islamic institutions need to focus on to take advantage of this ever-growing opportunity in global trade and working capital financing. Lastly, regulators in the UAE have been extremely helpful in establishing Islamic liquidity management options for institutions like us. But again, DIB and many other players require many more products to manage excess liquidity and, though Islamic CDs with Central Bank and the Sukuk investments are strong options, more products are required for both short-term and long-term liquidity management. Finally, legislations and laws need to be enhanced to accommodate the activities of Islamic finance as more and more institu-
What measures have you taken as a bank to broaden the appeal of islamic banking among the large expatriate population? Dubai Islamic Bank caters to all customer segments and does not focus on a niche segment. During the last few years, we initiated specific programmes and projects with a clear target to plug all product and service gaps that existed within DIB in order to have a more comprehensive and fulfilling offering for all our customers. This strategy has worked exceedingly well as DIB has so far been the topperforming bank in 2014 beating market expectations by a wide margin. With ample liquidity and strong capitalisation, we are ready to further strengthen and entrench our position in the banking sector in the UAE. We want to make banking a simple exercise for all. kindly enlist some of the popular products in this space. As one of the largest and well-entrenched consumer franchises in the UAE, we are cognisant of the needs of the expatriate population and over the years have invested heavily in developing products and offerings built around their requirements. For example, a few years ago, we were primarily focused on providing home finance to UAE nationals only, but now, particularly after the acquisition and integration of Tamweel, we have enhanced our offering for expats, and have become the largest mortgage provider in this segment. Home remittances are always a key concern for many expatriates and knowing this we have tied up with Western Union. It allows expatriates with accounts in DIB to remit funds to identified beneficiaries in their home countries through a wide variety of channels including online banking. Another product widely used in the UAE is Remit-to-ATM, a product that we pioneered. It allows account holders to provide instant cash to anyone in UAE via DIB ATM, irrespective of whether the recipient is a customer or not. Many of our expat salaried customers now have the convenience of getting additional cash through the Salary-in-Advance product, which provides instant credit to their accounts. Furthermore, the Business Online platform provides our SME
the perception among developed countries. At DIB, we offer comprehensive banking services across all customer segments and industry sectors of the economy. Islamic banking and finance does not allow for speculation in any way and hence structures that are essentially dependent on uncertain outcomes are eliminated from our offerings to our customers. Similarly, as a general thumb rule, the purpose or asset being financed is identified upfront and hence, there is a greater understanding of where the money is going and what it is used for. These factors stood out during the last few years as Islamic institutions generally remained more resilient compared to its conventional peers. That said, the basic rules of good governance and quality risk management remain just as important for Islamic as for conventional institutions. Quality disciplines such as these, combined with focused innovation and optimum use of technology are key to driving the Islamic banking industry forward. External stakeholders including evolution in legislations and laws is another major factor which Islamic banks have to drive in order to further entrench this already fast growing industry in the global financial landscape. identify constraints or challenges faced by the industry in the Uae? I feel that purely from a banking and finance perspective, the challenges that Islamic banks face are very similar to those faced by conventional counterparts. These relate generally to market movements and changes in global benchmarks and indices, competition, and general economic conditions among others. However, as a relatively nascent industry, Islamic banking still has room to grow in order to gain some of the econo-
tions, governments, corporates and individuals are leaning towards this fast growing form of banking and finance. What is your take on the World islamic economic Forum in dubai? We are looking for a sustainable strong growth journey for DIB for the benefit of our customers as well as shareholders. Simultaneously, we want to promote and elevate Dubai’s ambitions in becoming the capital of the global Islamic economy. At the same time, as the first Islamic Bank in the world and a global leader in Islamic banking and finance, we are committed to strengthening the overall industry and economy through proactive dialogues with the regulators, institutions, academia as well as the broader social society. Final word We believe that, in this overcrowded space, we need to make the business of banking simple for our customers. We believe that since we compete in the banking sector, the greatest differentiator will be the quality of service and how easy the customers’ overall interaction is with our bank. Thus, in line with the Shaikh Mohammed’s initiative of establishing Dubai as a “Smart City”, we have already moved forward with positioning DIB as the “Smart Bank” for all our customers, a concept which will be rolled out to all our touch points by the end of October this year. The aim is simple: To make banking experience with DIB enjoyable; so less time, no paper, and incredibly faster turnarounds. “Smart Bank” is the new and renewed service commitment that we extend to our customers and is sure to transform the service industry across, not just the financial sector, but the entire market in the UAE. [1053535]
khaleej times Tuesday, OcTOber 28, 2014
Smart Bank for a Smart City Introducing DIB ‘Smart Bank’ Aligned to the futuristic vision of Dubai’s leadership,
completely new and refreshing experience across all
Dubai Islamic Bank is proud to play a pioneering role in
aspects of banking – from paperless branches, to faster
supporting the plans of making Dubai a Smart City.
turnaround times and instant online services.
DIB ‘Smart Bank’ is a revolutionary concept that promises
Fully aligned to the vision of Smart Dubai, DIB ‘Smart Bank’
customers a never-before banking experience by making
is the result of a commitment to redefine banking through
banking quick, seamless and satisfying.
unsurpassed customer service.
To achieve this, Dubai Islamic Bank has invested in
And the passion to continue to lead the way as the
extensive and innovative use of technology leading to a
better way to bank.
Paperless Branches
Customer transactions are completed without filling forms by using handheld electronic devices. Digital signatures are taken for secure and efficient processing. Account opening formalities are completed and ATM cards and cheque books issued within 15-20 minutes. The paperless DIB ‘Smart Bank’ experience is now available at over eighty five branches in the UAE.
State-of-the-art Online & Mobile Banking
DIB ‘Smart Bank’ takes Dubai Islamic Bank’s leadership in online banking to the next generation. With cutting-edge innovation and extensive state-of-the-art technology, DIB ‘Smart Bank’ Online & Mobile Banking brings customers a banking experience that’s instant, secure and convenient.
Cutting-edge Technology Platforms
What makes DIB ‘Smart Bank’ the next generation in banking is Dubai Islamic Bank’s solid investment and hands-on experience in cutting-edge information and banking technology. This extensive use of technology to create a completely new and refreshing experience across all aspects of banking is fully aligned to the vision of a Smart Dubai.
Tie-up with Dubai Smart Government for Online Payments
A first of of its kind in the banking industry, with this tie-up, Dubai Smart Government (DSG) will electronically link the Government’s Resources Planning (GRP) Systems and Dubai Islamic Bank, through an automated and fully integrated platform provided by and in line with the DIB ‘Smart Bank’ mission.
www.dib.ae
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