UBF SMEs Initiative rescues 1700 companies of a total exposure of around AED 7 Billion
UAE Banks Federation commends Approval of Bankruptcy Law
The CEO Advisory Council of the UAE Banks Federation, the professional body representing 49 banks in the UAE, has held its third meeting of the year, today (Monday Sep 19, 2016), in Dubai, to discuss a number of high priority topics impacting the UAE’s banking sector. Top agenda items were the legislation of a UAE bankruptcy law, as well as progress made by the “modus operandi” (which was launched by the Federation earlier in the year) to support SMEs, among other vital topics. The meeting was chaired by HE Abdulaziz Al Ghurair, Chairman of the Federation.
CEOs discussed the recent approval by the UAE Cabinet of a UAE bankruptcy law. The Council welcomed the progress made in bringing the bankruptcy law into force, and recognised the mutual benefit it will bring both to banks and owners of businesses especially SMEs.They recognised the linkage between this development and the “modus operandi” formally initiated by the Federation earlier in the year by which lenders to SMEs experiencing repayment difficulties agree to a process to enable the companies to reschedule their debt and continue business as usual.
Members of the Council acknowledged the significance of the SME sector to the UAE economy and noted the important role that bankruptcy law are playing in other dynamic economies around the world. They also recognised that the existence of a bankruptcy law is a critical factor in both stimulating new entrants to the SME sector, as well as inward investment from overseas.
H.E AbdulAziz Al Ghurair, Chairman of the UAE Banks Federation, commented: “We commend and welcome the legislation of the bankruptcy law, which the government has recognised as a pre-requisite to the country’s future economic development, and as an essential tool to maintain the well-being of the business and environment economy. All banks were involved and responsible to consider every option to support their clients, and help them stay in business and succeed, especially SMEs which represent over 90% of the country’s non-government GDP.Through UBF’s SMEs rescue initiative, the “Modus Operandi”,banks were able to put in place a total figure of AED 7 billion of outstanding loans for more than 1700 SMEs and Corporates, restructured and under negotiation to restructure.Our meeting also focused on other areas in which we can make a contribution for the same objective – namely to help build as strong and resilient an economy for the UAE as possible. ”
The council also praised the progress done on the Mobile Wallet project indicated in the memorandum of understanding (MoU) recently signed by all 16 UAE equity partner leading banks, considering this as an important milestone in the development and implementation of the project. Further underscored the importance of customer service and enhancement of customer experience.
During the meeting, Stephen Jordan, Managing Director - Group Treasurer at NBAD, who is also a member in UBF Financial Markets committee, presented the committee's a paper which highlighted the changing role of regulatory reserves given the continuing developments in the international regulatory environment.
The meeting addressed also the progress so far on the work done in preparation for the Federation’s 4th Middle East Banking Forum, which is due to take place in Abu Dhabi on 14th November and which this year will be on a the theme of “Transforming the Customer Experience”.