Abu Dhabi's government-owned Al Hilal Bank is unlikely to break-even this year and may slow overseas expansion due to the global crisis but will grow organically in the UAE, the bank's CEO said.
The newest of eight Islamic banks in the emirates, Al Hilal, which became operational in June last year, had previously expected to turn a profit in 2009 and planned to target acquisitions abroad as part of its expansion strategy.
"There has been a sudden change in the economic climate and to be profitable in 2009 requires very bullish economic conditions. It is not as bullish now," said Mohamed Berro.
"We will be close to break-even, not reach profits in 2009," he said.
Despite the economic crisis, which began barely three months after the bank became operational, Al Hilal is pushing ahead with local expansion. The bank has opened seven branches in the UAE in the second half of 2008 and will stick to its plans of opening around 10 branches yearly until 2013.
"We are going ahead as per plans to expand locally, that was our priority before the crisis. But we are studying our priorities of overseas expansion. We will not necessarily expand, the climate is not conducive," he said, adding that there could be opportunities.
"But it is not a priority."
The Islamic lender, with an authorised capital of Dh4 billion and a paid-up capital of Dh1bn is owned 100 per cent by the Abu Dhabi Investment Council.