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Shareholders of Abu Dhabi Islamic Bank (ADIB), a leading Islamic financial institution, have approved proposal for a rights issue of AED 1 billion, as recommended by the Board of Directors of ADIB, to raise the Paid and Issued Share Capital through a tradeable rights issue of 464 million new shares to its shareholders. Shareholders also approved the issuance of USD 750 million (AED 2.75 billion) perpetual Tier 1 sukuk, and the repayment of its USD 1 billion (AED 3.67 billion) sukuk issued in 2012.
The proposals were passed by the requisite majority at the General Assembly for shareholders, held on August 19, 2018 at the Abu Dhabi Chamber of Commerce and Industry. The capital plan has been developed to support the bank’s continued growth and its objectives in achieving its strategy while meeting regulatory requirements.
Mr. Khamis Buharoon, ADIB Vice Chairman and Acting CEO, said: “In voting in favour of ADIB’s proposed capital plans, our shareholders have clearly understood and endorsed the bank’s growth strategy. The bank has performed strongly in recent years, demonstrating a consistent and sustainable track record of profitability and operational strength. Our focus has always been on maintaining a solid capital base, which can provide stability and enable the bank to expand and grow from a position of strength.”
The rights issue will increase ADIB’s Issued and Subscribed to Share Capital from AED 3,168,000,000 to AED 3,632,000,000 through the issuance of 464,000,000 new shares, issued at AED 2.16 per share (nominal value of AED 1 per share plus an Issuance Premium of AED 1.16 per share). This represents a 45 percent discount to the market share price as of July 25, 2018.
The bank will continue to focus on expanding its retail business, providing market-leading digital banking services, while capturing opportunities across corporate, transaction and correspondent banking. The bank will also continue to implement the cost control measures that were implemented during the year. ADIB reported a 3 percent increase in net profit for the first half of 2018, which reached AED 1.16 billion. Group revenues continued to grow, while the bank maintained a disciplined approach to cost and risk management. The bank paid a dividend of 28.87 percent of share capital for 2017, representing 39.76 percent of full year net profits.
ADIB will shortly announce the timetable for the rights issue, including the ex-rights date, rights trading period, subscription period, and other pertinent details of the rights issue following the approval of the Central Bank of the UAE and Securities and Commodities Authority (SCA).
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