Global issuance of sukuk (or Islamic bonds) has surged in recent months in a marked turnaround from earlier in the global credit crisis. And riding this wave of optimism are institutions like
Dubai Islamic Bank
, which predicts an upturn in fortunes on more positive growth projections worldwide.
It has been a less than vintage year so far for
DIB
, which saw third quarter net profit fell 31 percent year-on-year, as the lender booked higher provisions for exposure to bad loans.
“The past twelve months have presented a range of unprecedented threats to the stability of the global financial system,” admitted chairman Mohammed Al Shaibani.
The bank’s total assets dropped to AED82.9bn ($22.6bn) from AED87.8bn ($23.9bn) at the end of the second quarter. It did not explain the decline.
Nevertheless, rating agency Fitch said earlier this year that while
Dubai Islamic
was one of eight UAE banks that continue to face rising impairments and other challenges, it could also absorb higher impairments as capitalisation has improved and it have a high level of sustainable revenues. 2009 might have been a tough year, but things are looking up for 2010.
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