Dubai's ENBD wary of cbank loan rules
Dubai, April 25, 2012
Emirates NBD is wary of new regulations limiting loan exposures to state-linked entities, Dubai's largest lender said on Wednesday, after posting first-quarter earnings that beat analysts' forecasts.
The UAE's central bank this month introduced regulations which limited lending to state-linked entitites to 100 percent of any bank's loan book, a move designed to minimise the impact of problem loans.
Chief executive Rick Pudner told a media conference call that the bank was currently assessing its exposure and would contact the UAE central bank before the September deadline.
"The rules will definitely affect our loan book. Not only for us but also for all commercial banks in the country," Pudner said. "We are currently reviewing our position and will discuss with other banks and the central bank at a later stage," he added.
The lender is among the most exposed to state-linked entities restructuring debt and has seen its loan-loss provisions shoot up in the past quarters.
Earlier on Wednesday, ENBD, 55.6-percent owned by the Investment Corporation of Dubai, posted a forecast-beating 641 million dirhams ($174.51 million) first-quarter net profit, helped by a near 50-percent rise in non-interest income and lower impairments. - Reuters