Shareholders of Sharjah-based Invest Bank have approved an investment of AED1.1 billion by the Government of Sharjah
The shareholders of Sharjah-based Invest Bank on Wednesday approved an investment of AED1.1 billion ($300 million) by the Government of Sharjah.
The deal also includes a reorganisation of the board of directors, including the appointment of Sheikh Sultan Bin Ahmed Al Qasimi as chairman.
The Government of Sharjah said the investment is being made on a commercial basis, with the "objective of creating long-term value from Invest Bank's underlying profitability and standing".
The move comes after the bank has been hit by high levels of non-performing loans, in part because of its exposure to the real estate and construction markets.
In October, Invest Bank denied media reports linking it with a potential three-way merger with United Arab Bank and Bank of Sharjah, in which the government of the emirate has a 17.2 percent stake.
Shareholders also approved a further increase in share capital to be underwritten by the Government of Sharjah up to a certain amount, with details, including timing, to be determined later.
Sheikh Sultan, also chairman of Sharjah Media Corporation, Sharjah National Oil Company and Tilal Properties, said: “Today marks the beginning of a mutually beneficial and long-term strategic partnership between Invest Bank and the Government of Sharjah.
"Our priority is to keep improving the Bank’s asset quality by reinforcing the enhancements made to the risk processes, policies and further strengthening underwriting standards and implementing portfolio management best practices.
"Over the medium term, we aim to return the Bank to profitable growth through a strategy that allows us to improve operating margins and tap into commercially-viable opportunities.”
Omran Abdulla Omran Taryam, vice chairman of Invest Bank, added: “We welcome the Government of Sharjah as a strategic shareholder... The bank is now entering a promising, new chapter steered by a newly-appointed board that brings considerable experience in the banking sector and deep knowledge of the UAE economy.”
Sheikh Sultan Bin Ahmed Al Qasimi is currently Chairman at several private and public sector entities, including the Sharjah Media Corporation, Sharjah National Oil Company and Tilal Properties.For all the latest banking and finance news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.