The UAE-based banks are recently inclining to raise their capital in accordance with the International Financial Reporting Standard 9 (IFRS 9) and the expectation of a gradual hike in interest rates this year.
Almost six-listed banks on the UAE’s twin bourses announced intentions to boost their capital by a total value of over AED 6 billion ($1.67 billion), according to Mubasher statistics.
These banks tended to this method to meet the requirements the IFRS 9, as well as the requirements of raising their financial solvency, to reinforce their ability to provide financing services analysts told Mubasher.
The Central Bank of the UAE banks had implemented the IFRS 9 in January to introduce Basel III related to liquidity by the beginning of 2019.
Capital subscriptions of listed-banks are likely to attract many investors amid the announcement of robust financial results and higher cash dividends, senior financial analyst at Menacorp Financial Services Issam Kassabieh said.
Kassabieh noted that the capital hike will enable banks to achieve the highest growth rates and enter new expansions.