EBG to raise debt financing to $3.5 billion

DUBAI -The Extraordinary General Meeting (EGM) of the shareholders of Emirates Bank Group yesterday approved the proposal to raise funds through debt above its current net worth.

By Babu Das Augustine

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Published: Thu 2 Dec 2004, 12:48 PM

Last updated: Thu 2 Apr 2015, 11:46 AM

"The EGM amended Article 19 of the articles of association of the company to incorporate a provision to raise its existing debt financing through Euro Medium Term Note (EMTN) programme to $3.5 billion," said Ahmed Humaid Al Tayer, chairman of Emirates Bank Group.

The bank's EGM also approved extension of the EMTN programme to 10 years. "The bank and the local economy are going through a phenomenal growth phase. We need to be adequately capitalised to meet the medium and long term financing needs of the businesses in the country," Al Tayer said.

While adding to the Tier 2 capital, the proceeds from EMTN programme is expected to give higher comfort level to EBI in terms of asset-liability matching in the medium and long term lending programmes. "The resources available to the bank currently in the market range from short term to medium term deposits, while the market has a huge appetite for long term financing needs," he added.

Managing Director and CEO of the Emirates Bank Group Anis Al Jallaf said the EMTN programme enables EBI to plan its mobilisation of medium term money, so as to fund its asset book to meet the requirements of projects of long tenor as well as to support corporate customers. Commenting on the overall banking sector profitability, Al Tayer said, the banks are expected to show good results this year and the EBG's net profits are expected above Dh900 million.

"Going by the results for the first three quarters EBG's profits should be about Dh900 million."

Speaking about the expansion plans, Al Tayer said the bank is working towards its entry into Kuwait and Qatar. In September this year, EBI had opened its branch in Saudi Arabia. The group's investment banking subsidiary, Emirates Financial Services is currently undergoing restructuring, he said.

Commenting on the possibility of an IPO from Emirates Islamic Bank, the EBG chairman said, the IPO will be considered only after a full year of operation.

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