x Abu Dhabi, UAEMonday 24 July 2017

Dubai aid mechanics mulled

The Abu Dhabi Government is still considering whether to channel US$4 billion (Dh14.69bn) of its aid to Dubai through two local banks or lend it the money directly, a banker says.

The Abu Dhabi Government is still considering whether to channel US$4 billion (Dh14.69bn) of its aid to Dubai through two local banks or lend it the money directly, a banker says. "It hasn't been decided yet," said Lim Say Cheong, the executive vice president and head of the executive office at Al Hilal Bank, which is owned by the Abu Dhabi Investment Council. Al Hilal and the National Bank of Abu Dhabi (NBAD), another government-controlled lender, agreed in late November to buy $5bn in five-year bonds from Dubai as part of efforts to help the emirate and its companies avoid defaulting on an estimated $87bn of debt.

The bonds pay a yearly interest payment of 4 per cent. It is unclear whether the banks will still purchase the remaining $4bn in bonds, or if Abu Dhabi will assume their commitments. warnold@thenational.ae