ABU DHABI, March 21 (Reuters) - Abu Dhabi's Union National Bank said on Saturday it would convert into regulatory capital 3.2 billion dirhams ($871.2 million) of state deposits.
The bank is the latest in the United Arab Emirates to say it would convert deposits from the government's 70 billion dirham state facility into Tier 2 capital.
'The bank will convert the entire 3.2 billion dirhams of deposits from the Ministry of Finance into Tier 2 Capital,' Chief Executive Mohamed Nasr Abdeen told Reuters at the bank's annual general meeting.
'(The conversion) will increase the bank's capital adequacy ratio (CAR) to nearly 20 percent ... from the present 11 percent,' he said.
Abdeen said he expected loan growth in the range of 10 percent this year.
'Definitely we will be choosy, but we will lend to sectors supporting the economy,' he said. 'Interbank liquidity is good enough but liquidity to move the economy is not enough.'
UNB's loan-to-deposit ratio had come down to 90 percent from 101 percent in 2008 after securing deposits, Abdeen said.
The meeting also saw the approval of the board's proposal for a 10 percent cash dividend that will amount to a total of 187.5 million dirhams, as well as the approval of a 1-for-10 bonus share issue.
The bank's share capital would rise to 2.062 billion dirhams from 1.875 billion dirhams once the bonus share issue was implemented, Abdeen said.
UNB had also scaled back its expansion plans for its Egyptian unit, Union National Bank Egypt, he said.
'The Egyptian bank expansion may not be as per the original strategy,' he said, adding that the bank had initially wanted to open 20 new branches in Egypt every year.
'We will expand with a much lesser number,' Abdeen said.
(Reporting by Stanley Carvalho; Writing by Raissa Kasolowsky) ($1=3.673 dirhams) Keywords: UNB CAPITAL/ (raissa.kasolowsky@reuters.com; +971 4 391 8301; Reuters Messaging: raissa.kasolowsky.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
The bank is the latest in the United Arab Emirates to say it would convert deposits from the government's 70 billion dirham state facility into Tier 2 capital.
'The bank will convert the entire 3.2 billion dirhams of deposits from the Ministry of Finance into Tier 2 Capital,' Chief Executive Mohamed Nasr Abdeen told Reuters at the bank's annual general meeting.
'(The conversion) will increase the bank's capital adequacy ratio (CAR) to nearly 20 percent ... from the present 11 percent,' he said.
Abdeen said he expected loan growth in the range of 10 percent this year.
'Definitely we will be choosy, but we will lend to sectors supporting the economy,' he said. 'Interbank liquidity is good enough but liquidity to move the economy is not enough.'
UNB's loan-to-deposit ratio had come down to 90 percent from 101 percent in 2008 after securing deposits, Abdeen said.
The meeting also saw the approval of the board's proposal for a 10 percent cash dividend that will amount to a total of 187.5 million dirhams, as well as the approval of a 1-for-10 bonus share issue.
The bank's share capital would rise to 2.062 billion dirhams from 1.875 billion dirhams once the bonus share issue was implemented, Abdeen said.
UNB had also scaled back its expansion plans for its Egyptian unit, Union National Bank Egypt, he said.
'The Egyptian bank expansion may not be as per the original strategy,' he said, adding that the bank had initially wanted to open 20 new branches in Egypt every year.
'We will expand with a much lesser number,' Abdeen said.
(Reporting by Stanley Carvalho; Writing by Raissa Kasolowsky) ($1=3.673 dirhams) Keywords: UNB CAPITAL/ (raissa.kasolowsky@reuters.com; +971 4 391 8301; Reuters Messaging: raissa.kasolowsky.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.