Emirates Islamic aims to double branch network

Dubai: Emirates Islamic bank will open a new branch every month for the next 12 months to boost customer base and take on foreign and domestic rivals.

Officials said the bank, one of the country's four Islamic banks, add the branches to its existing ten outlets to help extend its reach and prise Muslim customers away from conventional banks.

"The market is growing and the potential is huge. We could easily double our deposit base over the next year since our base is small," Faisal Aqil, Emirates Islamic's said.

He said customer deposits at Emirates Islamic, which was launched operations in October last year, had grown 100 per cent in the past year compared to industry growth of just 30-40 per cent.

The bank, a unit of third-ranked Emirates Bank International, had deposits of Dh2.77 billion at the end of September, according to its most recent results, compared to Dh1.13 billion in September last year.

Aqil said the company was positioning itself as a mid-level premium bank that would compete with the 44 conventional domestic and foreign banks rather than other Islamic institutions.

Aqil said its new priority banking service, Ethmar, was aimed at high net worth customers with deposits of at least Dh150,000 that will be offered personal relationship managers and have access to investment services like brokerage and funds. "We are not going to be the McDonalds of the banking industry," Aqil said. He said profit margins were higher in a premium banking service like Ethmar, which would mainly compete with priority banking services of foreign banks like HSBC.

Emirates Islamic reported a 51.6 per cent rise in net profit in the nine months to September to Dh32.3 million as total income more than doubled to Dh122.1 million.

The bank was helped by an industry boom as well as a growing acceptance for Islamic banking.

The share of Islamic banks in overall retail deposits of all UAE banks increased to 14 per cent at the end of 2004 from 10 per cent in 2001.

Emirates Islamic Bank has called an extraordinary shareholders' meeting on December 21 to consider a 30 per cent bonus share issue and 10-for-one stock split. Its shares last traded at Dh16.45 on the Dubai Financial Market.