Ajman Bank's public offering opens on Sunday

Dubai: Ajman Bank, a new Islamic bank under formation, opens its Dh550 million initial public offering on Sunday.

The IPO, priced at Dh1.02 in administrative cost, is open to all UAE residents and will close on February 28. The IPO is for 550 million ordinary shares, or 55 per cent of the total shares of the bank. The minimum subscription will be for 2000 shares.

The public offer is advised by HSBC and subscriptions can be made through participating banks such as Abu Dhabi Islamic Bank, Dubai Bank, Emirates Islamic Bank, Dubai Islamic Bank and Noor Islamic Bank. Following the offering and completion of the incorporation process, the bank will list its shares on the Dubai Financial Market.

The offering is open to UAE and non-UAE individual and institutional investors. While five per cent of the offer (27.5 million shares) will be allocated to the Ministry of Finance and Industry, non-UAE subscribers - including subscribers from GCC states - will be allocated up to 100 million shares. The remaining 422.5 million shares will be allocated to UAE subscribers.

The new bank, the first banking institution to be incorporated in Ajman, will have 25 per cent equity participation from the Government of Ajman and 20 per cent of the shares have been placed with institutional investors and high networth individuals.

Future plans

"We already have the support of the Government of Ajman. We are now seeking to open up the growth potential we offer to investors in the UAE and the GCC by offering 55 per cent of our equity through a public offering on the Dubai Financial Market. The proceeds from the listing will fund an aggressive roll-out of branches and services across the UAE," said Yousif Khalaf, CEO of Ajman Bank.

The new bank intends to target the rapidly expanding Sharia financial services market in the UAE.

"Ajman Bank will play a significant role in the econ-omic development of Ajman and the UAE. We intend to play a role in financing the real estate and small and medium enterprise sector in Ajman and across the UAE," Khalaf said.

The bank plans to start retail banking operations by the fourth quarter of this year while investments and treasury operations are expected to begin in the third quarter.

The bank with its own independent Sharia board has plans to offer comprehensive Islamic banking solutions.

IPO in a nutshell

• IPO size: 550m shares
• Issue date: February 17 to 27
• Issue price: Dh1.02
• Minimum subscription: 2,000 shares

Allocation

• Ministry of Finance and Industry: 27.5m shares
• Non-UAE investors: 100m shares
• UAE national investors: 422.5m shares
• Ajman Government: 250m shares
• Private placement: 200m shares