Invest Bank shareholders approve continuation of lender despite losses
Sharjah bank's losses are about half of its subscribed capital of Dh3.18 billion
The shareholders of Sharjah’s Invest Bank approved the continuation of the commercial lender despite its losses amounting to half of its subscribed capital.
The shareholders also agreed in their meeting last week to use two reserves of Dh450.67 million each “to cover for accumulated losses or the provisions due to be taken as per the instructions of the Central Bank of the UAE”, the Invest Bank said in a statement to the Abu Dhabi Securities Exchange, where its shares are traded.
The shareholders, who control more than 10 per cent of the bank and include International Special Group, Gulf Economic Company and Omar Abdullah Omran Taryam Holding, approved a special resolution seeking the bank’s preservation despite the losses, which reached about half of its subscribed capital of Dh3.18 billion.
Invest Bank operates a network of 15 branches in the UAE and an international branch in Lebanon.
It is one of the Emirates’ smaller banks and has been hit by high levels of bad loans in recent years, partly due to its exposure to the real estate and construction industry, which has suffered a slowdown following a three-year oil price dip that began in 2014.
Last month, shareholders appointed Sheikh Sultan bin Ahmed Al Qasimi – a member of the Sharjah ruling family – as the bank’s new chairman and approved a Dh1.15bn strategic investment into the lender from the government of
“Our priority is to keep improving the bank’s asset quality by reinforcing enhancements made to the risk processes and policies and further strengthening underwriting standards and implementing portfolio management best practices,” Sheikh Sultan said.
His appointment is part of a bigger reorganisation of the board of directors.
The move follows the Sharjah government’s decision to take a majority stake in the lender in December, with the aim to return Invest Bank to profit
after it posted a Dh136.5m loss in 2018.
Updated: May 19, 2019 05:45 PM