- City Fajr Shuruq Duhr Asr Magrib Isha
- Dubai 04:50 06:04 12:14 15:39 18:19 19:33
Sharjah Islamic Bank (SIB) yesterday said it made fewer provisions in 2009 than the previous year and faced few defaulting cases but rescheduled the financing, according to its chief executive officer.
"We had a few cases and we have managed them all. We have discussed with defaulters way of solving the problem. Most of them have agreed on rescheduling their financing, whereas a few have committed to resume payments," Mohammed Abdullah told Emirates Business.
"The number of defaulters was very few because even before the crisis the bank's crediting policy was tight. However, further precautionary regulations have been taken by the bank last year to ensure more security and avoid or minimise risk margin. We have re-studied our crediting policy, the bank's provisional adequacy and debtor's financial status and resources and succeeded in avoiding risks," he said. "Even during the crises we were investing and financing projects."
The bank earlier announced $15 million (Dh55m) exposure to Algosaibi and said it had made full provisions for that amount.
"I assure that 2009 made good profits and the results, which will be announced soon, proves what I am saying," he said. "The general provisions of 2009 were less than those of 2008. We overcome all crises and achieved a good rate of growth," he said.
Regarding the financial support extended by the Central Bank and the Ministry of Finance to SIB, Abdullah said: "We have signed a three year-duration Shariah-complaint contract with the Central Bank according to which we invest the fund on behalf of the Central Bank. After three years we have to payback the fund and if we failed the Central Bank will have a take in SIB."
He said a Shariah governance committee representing Islamic banks operating in the country has discussed with the Central Bank the need to make the funding form and operation a Sharia-compliant one.
Although the two parties have reached a solution, it is not yet in implemented, he said.
The bank's investment were not affected by the crises because "our investment portfolios were of small amounts", he said.
The bank's capital adequacy ratio (CAR) stood at 27 per cent and is significantly high compared to those of other banks. He said the bank's performance is very good and was far more than the minimum capital adequacy ration specified by the central bank at 11 per cent.
Abdullah said the bank has surplus of liquidity and is studying to expand its investments in the UAE and GCC countries. "We are studying investment opportunities which would via portfolios, joint venture-ships and other financial activities," he said.
Abdullah was speaking after the inauguration of the bank's headquarter premises at Al Khan Lagoon by His Highness Dr Sheikh Sultan bin Mohammed Al Qasimi, Member of the Supreme Council and Ruler of Sharjah, yesterday.
"The opening of the Dh300 million new headquarters, which is built over 1600 square metre compared to the 400 square metre at the previous location, forms part of SIB's expansion strategy, which aims to meet the requirements of a growing market and further improve its retail and corporate banking services, thereby pushing wheel of national economic development forward," said Mohammed Abdullah.
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