NBQ issues convertible bond worth Dh2.36b

Dubai: The National Bank of Umm Al Quwain (NBQ) and Global Investment House yesterday announced a primary agreement to issue a Dh2.36 billion convertible debt instrument.

"The convertible bond will be issued by NBQ to Global for a total consideration of Dh2.36 billion. Global shall have the option to convert the instrument into 330 million new shares of NBQ," a joint statement said.

Upon successful conversion, the new issue would imply 25 per cent expansion of the existing paid in share capital, giving Global a 20 per cent stake in NBQ.

Finalising the issuance is subject to UAE regulatory authorities' approval.

Shaikh Nasser bin Rashid Al Mualla, managing director and chief executive of NBQ, stated: "The partnership with Global will raise the bank's paid-up capital to Dh1.65 billion.

It will also raise the owners' equity to more than Dh5 billion. The new capital will assist the bank in developing its business operations and enhance its growth rate with a more solid capital basis."

Global has conducted a successful $1.15 billion global depository receipts (GDR) issue in May 2008.

It will use the new capital to conduct strategic investments for strengthening its distribution power and stabilising annuity.

Global recently acquired a 19 per cent stake in the Bank of Bahrain and Kuwait.

NBQ is listed on the Abu Dhabi bourse and is among the leaders in terms of market capitalisation. It is well positioned to gain from the economic growth in the UAE.

The bank has an aggressive business plan to reinforce its presence in the UAE. The Government of Umm Al Quwain is the bank's major shareholder since inception, apart from major UAE major investors.

NBQ was established in 1982 and since then it has been witnessing a consistent growth in assets and yearly profits.

The bank offers retail, corporate and institutional banking services and also operates an Islamic banking window. It has 16 branches and 30 ATM kiosks, serving more than 100,000 clients.