Dubai Islamic Bank increases foreign ownership limit to 25% - IFN

Dubai Islamic Bank increases foreign ownership limit to 25%

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UAE: In addressing the unmet demand by large foreign institutional investors, Dubai Islamic Bank (DIB) will raise its foreign ownership limit (FOL) upon receiving necessary regulatory approvals. In a meeting held recently, DIB’s board of directors came to a consensus to increase the FOL from the current 15% to 25%. “Following a well-crafted strategy during the economic downturn, we ensured that while aligning the bank to the adverse market conditions prevailing at the time, we remain cognizant of stakeholders’ expectations from the organization. Hence, the strategy and the business model shift were squarely aimed to improve and maximize returns for the benefit of stakeholders, including local, regional and global investors,” said Adnan Chilwan, CEO of DIB. Adnan further elucidated that the improved overall economic climate and the stellar performance of the Dubai Financial Market over the last year, propelled the bank to allow greater liquidity for foreign investors, particularly institutional funds. “The bank’s stock is up significantly so far [in 2013] and we remain confident that, with a return to growth, we will continue to fulfil our commitments to all stakeholders,” he added. In light of the MSCI upgrade taking effect this year, the new FOL limit is believed to position DIB as a strong candidate for inclusion in the MSCI basket of securities. The emerging status upgrade is expected to reign in AED1 billion (US$272.18 million) in investments into listed companies. Following the board approval for the FOL, the bank will proceed to follow the required regulatory process to formalize the decision.