Abu Dhabi Islamic Bank expects double digit growth this year as it expands locally and into Iraq and Egypt to be among the top three sharia compliant lenders in the Middle East, its CEO said.
In an interview with Reuters, Tirad Mahmoud said: "We are definitely looking at double digit growth in 2010. The Abu Dhabi government has injected money into the economy and this will bring life into the banking system."
He said the expected double digit growth referred to profit, deposits and other aspects of the lender's spread sheet for 2010.
He added: "We will see double digit growth in loans this year. We won't randomly lend but will be selective."
ADIB, the second largest Islamic lender in the United Arab Emirates, posted a fourth-quarter loss of $169.7 million due to sharply higher provisions.
The bank had annual earnings of $21.2 million in 2009 after taking provisions of $476.4 million for the year.
Mahmoud said: "Don't expect the same extent of provisions in 2010 but we will have (provisions) because it is part of the ongoing business. We cannot rule out additional accidents in the market place, we are ready for them."
The bank has secured a licence to start operations in Iraq and is awaiting a licence in Algeria.
Mahmoud said: "We plan to open for business by June 2010 in Iraq. Iraq has oil, gas, a growing population and it will reach political stability."
ADIB also plans to expand its Egyptian subsidiary, the National Bank of Development, by converting it into an Islamic bank and rebranding it before the end of 2010.
He said: "Egypt is a big market. The bank has the potential to go up to 100 branches in the short term."
Currently, the bank has 69 branches in Egypt.
In the UAE, the bank will open nearly 20 branches this year to tap demand for Islamic banking.
Mahmoud said: "By end 2010, we will have 70 branches. We are looking at areas not saturated. There is pent-up demand in retail here."
He added: "We want to be number one in the UAE in size and among the top three in the MENA (Middele East and North Africa) region, that is our target in the near-term."
ADIB plans to open up 25 percent of its shares for foreign ownership but has postponed its shares buyback plan, he said.
He said: "It is the right time to do it because we will be actively engaged in two strategic markets - Egypt and Iraq."
Mahmoud added: "At the board meeting today, we postponed the shares buyback plan. We will relook at this later." (Reuters)