x Abu Dhabi, UAEMonday 24 July 2017

DIFC splits its property and finance operations

The Dubai International Financial Centre has announced a far-reaching restructuring designed to enhance its role as the region's premier investment hub.

The shake-up at the DIFC marks a recognition of its dual roles. Jaime Puebla / The National
The shake-up at the DIFC marks a recognition of its dual roles. Jaime Puebla / The National

The Dubai International Financial Centre (DIFC) has announced a far-reaching restructuring designed to enhance its role as the region's premier investment hub.

The DIFC Authority, the government-run body that controls the centre, is to split its two core functions - financial markets and property management - into separate units and has appointed key executives to head up the two arms.

Jeff Singer, an American financier who has been head of the Nasdaq Dubai stock exchange for the past four years, is to be the chief executive of the DIFC Authority, replacing Abdulla Al Awar, and will be responsible for business development and legislation.

Nabil Ramadhan, currently the deputy chief executive of DIFC Properties, has been appointed the acting chief executive of the centre's property business.

Hamid Ali, the executive director of the Knowledge and Human Development Authority, will take over from Mr Singer as executive head of Nasdaq Dubai.

The shake-up marks a recognition of the dual roles of the DIFC. It began operating in 2004 to provide a focus for Dubai's ambition to become the Arabian Gulf's most important financial market but derives most of its revenue from rental income on the fast-growing site centred around The Gate building in the heart of the city.

"DIFC Authority's medium-term goal is to build on the Centre's successful performance to date and double its scale as a global financial hub," the authority said.

"The board has therefore decided to segregate its two core functions into two independent entities: the business development and legislation arm, to remain named DIFC Authority, responsible for developing DIFC's international relations with the world's other leading financial centres and further strengthen the Centre position globally; and DIFC Properties to manage the Centre's real estate portfolio and responsible for delivering DIFC's master plan."

Mr Singer has sometimes been a vocal critic of Dubai's financial industry and is an advocate of consolidation of the UAE's three stock exchanges into one market.

Although plans have been drawn up by the US investment bank Goldman Sachs to prepare for unification, no timetable for the merger of the two exchanges in Dubai and one in Abu Dhabi has been made public.

"Under Jeff Singer's dynamic leadership, Nasdaq Dubai has expanded its role as a centre of Middle East capital markets enterprise and growth, combining best international practice with regional expertise and understanding," said Abdul Wahed Al Fahim, the chairman of Nasdaq Dubai.

"The exchange will continue to pursue this strategy, further strengthening the UAE's prominent position in the financial markets.

"As markets recover from global volatility, Nasdaq Dubai is well placed to fulfil its enormous potential as the international exchange serving the region," he added.

"Its unique role as a bridge between regional and international financial markets positions it to attract further initial public offerings of large companies as well as small and medium-sized enterprises."

Nasdaq Dubai has suffered from a lack of liquidity with low transaction volumes since its inception. Most of the business done on the market consists of shares traded in DP World, the global ports company that is also traded on the London Stock Exchange.

Since the global financial crisis and the Arab Spring, the DIFC has been successful in attracting financial institutions from other parts of the Middle East and from Asia. About 40 per cent of its 900-odd member firms come from the Middle East, Asia or Africa.

fkane@thenationa.ae

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