ADIB’s Board Recommends Increasing Capital Through A Rights Issue

The rights issue is subject to regulatory approvals

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The Board of Directors of Abu Dhabi Islamic Bank (ADIB), a leading financial institution, today recommended to increase the issued capital of the bank by AED 464 million by issuing 464 million new shares at a nominal value of AED 1 per share as well as an issuance premium of AED 1.16 per share, bringing the total value of the Rights issue to AED 1 billion. This increase supports ADIB’s objectives in achieving its 2020 vision while meeting regulatory requirements.

The rights issue is subject to regulatory approvals and by the bank’s shareholders at a general meeting, which will be scheduled for the coming weeks.

The board has also proposed the issuance of a $750 million (AED 2.75 billion) perpetual tier 1 sukuk, and the repayment of its $1 billion sukuk that was successfully issued in 2012 as the world’s first Shari’a- compliant hybrid tier 1 sukuk. 

The proposed rights issue would increase the issued capital from AED 3,168,000,000 to AED 3,632,000,000 through issuance of 464,000,000 new shares.

Mr. Khamis Buharoon, ADIB Vice Chairman and acting CEO, said: “The pace of the bank's growth has been fast, increasing its number of customers to one million in the UAE, nearly double the number it had five years ago. To maintain its growth trajectory, while maintaining a solid capital buffer, the bank is looking to increase its capital. We are therefore inviting our shareholders to participate in our growth trajectory through a rights issue. This will enable ADIB to continue to invest in innovation to provide top-quality banking services, and to deliver the returns our investors have come to expect from ADIB.”

ADIB reported a 17.7 percent increase in net profit in 2017, which reached AED 2.3 billion. Robust revenues growth, while maintaining a disciplined approach to cost and risk management. The bank paid a dividend of 28.87% for 2017, representing a payout of 39.76% of full-year net profit.

The proposed issue of 464 million new shares, will be issued at AED 2.16 per share, which represents a 45 percent discount to the closing share price on July 25.

ADIB will set the timetable for the rights issue and the tier 1 following shareholder approval.

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