ADIB proposes AED 1bn rights issue, AED 2.75bn sukuk

ADIB proposes AED 1bn rights issue, AED 2.75bn sukuk
ADIB's board proposed a capital hike via a rights issue and sukuk
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Abu Dhabi – Mubasher: Abu Dhabi Islamic Bank's (ADIB) board on Thursday recommended raising the bank's capital through a rights issue by issuing 464 million new shares at a nominal value of AED 1 per share added to an issuance premium of AED 1.16 per share.

Accordingly, the total value of ADIB's rights issue would be AED 1 billion.

"This increase supports ADIB’s objectives in achieving its 2020 vision while meeting regulatory requirements," the bank said in an official statement.

If approved, the proposed rights issue would raise the Abu Dhabi-listed bank's issued capital to 3.632 billion shares from 3.168 billion shares.

ADIB's board also proposed issuing $750 million (AED 2.75 billion) in perpetual tier 1 sukuk as well as 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 statement showed.

ADIB has enjoyed quick growth after its customers nearly doubled to 1 million in the UAE from five years prior, the bank's vice chairman and acting CEO Khamis Buharoon said.

"To maintain its growth trajectory, while maintaining a solid capital buffer, the bank is looking to increase its capital…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,” the top official added.

ADIB's rights issue remains subject to approvals by regulatory bodies and the bank’s shareholders. A general meeting will be scheduled in the coming weeks, it said.

ADIB last reported a slight rise in profits to AED 572.7 million in the second quarter of 2018, up 3.8% year-on-year from AED 551.6 million.