Banking & Business Review, May 09

Vol. VI. No. 42 May 2009

Editor’s note

Editor K Raveendran

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consulting Editor Matein Khalid



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Publisher & Managing Director Sankaranarayanan

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Director Finance Anandi Ramachandran

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Editorial Staff Writer Ambily Vijaykumar

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Contributing Editors Anand Vardhan Linda Benbow Vanit Sethi Manju Ramanan

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DESIGN Creative Director Harikumar PB

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Designer Ujwala Ranade

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Sales and Marketing General Manager (Sales & Marketing) Radhika Natu

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Product Manager Vijayn G

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Senior Advertisement Executive Sanjana Antony

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ACCOUNTS Biju varghese

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Office Co-ordinator Daisy Orfrecio [email protected] Circulation Supervisors Ibrahim A. Hameed Saleem K U

There’s hope

M

ost indicators are pointing to an early recovery in the local economy. The worst fears of the year-end have been disproved as companies and businesses report their first numbers for the quarter. Liquidity, no doubt, continues to be tight, but there are attempts to come out of the siege, as it were. Banks are beginning to lend again, although they are very selective on who should get the money and on what conditions. The more aggressive among them are ready to try out new ways of breaking the ice. Similarly, the earning season has not been that bad. Banks have turned in profits, but of course, not like those heady days. Profitability has gone down, but still there is money to be made. According to indications, most UAE banks would be relatively comfortable by the second quarter and already there are signs of a positive turn. Market confidence, which had hit the bottom, seems to be picking up and the stock markets are showing some signs of a movement. The property sector is also said to be turning away from a state of absolute hopelessness to one of measured caution as the continued fall in prices seems to have been arrested somewhat. Even if the fall hasn’t stopped, the pace of the fall has slowed down and maybe within the foreseeable future there could be signs of stability. Coupled with all this, Dubai has reported improved tourist arrivals and hotel occupancy, both of which had apparently been a great cause of worry. If things continue to happen this way, there may be soon light appearing from the other end of the tunnel.

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CONTENTS 10 COVER STORY

Signals Analysts see positive signs of an early pickup emerging

4 RISK MANAGEMENT

Is it greed alone?

14 EXECUTIVE EDUCATION SPECIAL

Ten lessons to be learnt from failure of risk management systems

To train or not to be Executive training programs get a boost Flab has to go Enthusiastic response to training Re-learning the basics Break from textbook learning When job seekers invade Facebook Plugging Arab brain drain

38 INTERNATIONAL

Toxic waste removal

30 COMMODITIES

DGCX rupee futures are hot

Markets applaud plan to rid bank balance sheets of bad assets

Currency futures emerging as most attractive asset class

34 ECONOMY

Middle East weathering global crisis: IMF Fundamentals and policy responses help mitigate impact of shock

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May 2009

46 TECHNOLOGY

Prepaid cards

New wave of innovative banking?

RISK MANAGEMENT

Is it greed alone? Ten lessons to be learnt from failure of risk management systems in global financial crisis

O

ne of the most important lessons of the current financial crisis is that incentive systems for mangers must be constructed in such a way that they reward long-term stability, not short-term profit, an Economist Intelligence Unit whitepaper on the failure of risk management and the probable answers to prevent such disaster in future has concluded. Both institutions and supervisors are asking themselves other, vital questions. Were the tools available to risk managers fit for purpose? Was the approach to risk management based on a historical view of the world that pertained to an unprecedentedly rosy era in markets and the economy? And was there insufficient risk expertise and understanding at the very top of some of the world’s largest organisations? The EIU whitepaper, sponsored by ACE, KPMG, SAP and Towers Perrin, examines the lessons that have been learnt from the current financial crisis, and proposes ten practical steps that could help to address perceived weaknesses in risk identification, assessment and management. Although the research is primarily directed at financial institutions, it also highlights ways in which these lessons could apply to corporates from other industries. The paper notes that the word that comes up most often when politicians, regulators or ordinary consumers are

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asked about the roots of the credit crunch is greed, but says this by itself is an unsatisfactory explanation. “Greed is not just a universal human characteristic, but a necessary component of the capitalist model. Without it, economic incentives would not work,” it says. But a common lesson from most market failures is that the incentives have to be carefully designed. “Where high-risk positions can be taken in illiquid assets, it’s very hard to prevent problems unless the incentives are right,” the paper quotes Viral Acharya, visiting professor of finance at New York’s Stern School of Business, as saying. So while vigorous action should be taken to root out illegal trading, such as the Ponzi scheme set up by Bernard Madoff, a spotlight should also be shone on the incentive structure that encouraged actors throughout the economy to pursue short-term rewards with no regard to long-term costs. The growth of this unbalanced incentive structure was itself an indicator of trouble ahead, but one that was largely brushed aside. “No one had the courage to look at areas where there were incentives to cheat,” says Sandro Boeri, managing director at Risk Audit Ltd, a UK-based company offering training to the corporate governance function “Bonuses for risk-taking were so high that few could afford to take

May 2009

a contrary view. They would not have lasted long.” Short-term incentive structures were endemic during the boom. The bonus culture rewarded traders and senior financial executives for realising immediate profits on assets that would take years to mature. Share options encour-

aged behaviour that pushed up equity values regardless of long-term consequences. “Many of the banks struggling now to make capital were buying back their own shares in 2004, 2005 and 2006,” says John Crosby, a quantitative analyst, until recently head of quantitative analytics at Lloyds TSB.. “Maybe their stock options led them to pursue antidilutive strategies.” There were other incentive anoma-

and in contrast with the traditional banking model, banks were being rewarded for the volume of business they could generate, rather than the quality of the underlying loans. This removed the incentive for prudent risk assessment and replaced it with the opposite: an incentive to provide mortgages to an ever-growing demographic. Similarly, the investment banks who took the credit derivatives to market and the rating agencies who

“Greed is not just a universal human characteristic, but a necessary component of the capitalist model; without it, economic incentives would not work”

lies. Using securitisation, banks in effect made money on the difference between the cost of borrowing on short-term money markets to fund mortgage lending and the cost of selling the pooled mortgages to institutional investors. In the process, they were shifting credit risk off their balance sheets. As a result,

gave the senior tranches their endorsement made money on volume, regardless of quality. The mismatch between the shortterm incentive structure and long-term risk exposure that characterised the run-up to the crisis has been identified as a key area for reform. The bonus culture and remunerative models for senior banking executives are likely to be overhauled, with some of the rewards in future being withheld to match the maturity of the underlying business. If corporations are unable to enforce this discipline on themselves, then the success of risk management in heading off future crises will depend on the ability of governments and regulators to design and enforce rules that do the

job for them. The paper recommends that risk management must be given greater authority. Such was the level of comfort among regulators and policymakers that in June 2005, months after the first rumours of strains in the US housing market were bubbling to the surface, Alan Greenspan, then-chairman of the Federal Reserve, would acknowledge only ‘signs of froth’ in certain local markets. (His successor and the current incumbent, Ben Bernanke, was no more prescient, saying in congressional testimony in March 2007 that the impact of what was by then a substantial subprime problem on the broader economy and financial markets ‘seems likely to be contained’.) So why were banks’ risk managers not sounding the alarm bells? Part of the answer is that they were, but that they were not heard. “At large universal banks 18 months ago, risk managers were trying to curb risk-taking by front offices,” says Viral Acharya. In other words, risk managers – a cost on the banks’ balance sheet – were calling for restraint on business at a time of high profitability in the sector as a whole. Those generating the profits pushed to be let off the leash and, all too often, the senior executives allowed the profit centres to win the argument. “The bargaining power of profit centres builds during the good years, so it becomes easy to sideline the risk managers,” says Acharya. The attitude that the opportunity for profit was trumping any concerns being raised by risk managers was exemplified by Charles O. Prince, Citigroup’s chief executive, in July 2007. In a now infamous phrase he told reporters: “As long as the music is playing, you’ve got to get up and dance. We’re still dancing.” The whitepaper recommends that If risk management is to be given appropriate attention throughout the organisation, leadership and tone from the most senior level in the organisation

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While vigorous action should be taken to root out illegal trading, such as the Ponzi scheme set up by Bernard Madoff, a spotlight should also be shone on the incentive structure that encouraged actors throughout the economy to pursue short-term rewards with no regard to long-term costs

will be essential. In many institutions, risk management is still struggling to shake off an outdated perception that it is largely a support function. This outmoded perception of risk management is due in part to its relatively short history. “Back in the 1980s, there was no risk management department,” says John Crosby. “A bank’s head trader had the experience and authority to rule on poor trades and have them unwound.” Then in the 1990s, institutions began to worry that this was too much responsibility for one individual, and set up risk management departments. “They came up with metrics to judge what traders’ exposure was,” he points out. “But this is risk

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measurement, not risk management. The head trader had the authority to tell you to cut your positions, and you did it in minutes. Risk management simply doesn’t have that clout.” Further, the paper argues that institutions have to review the level of risk expertise in their organization. The proliferation and complexity of new financial instruments and trading strategies, often based on complex mathematics or channelled through a chain of institutions in opaque and unregulated markets, was bound to confuse even the sharpest observers. Indeed, in many cases this may have been the explicit intention, as traders and dealers sought to engage in risk-taking that

May 2009

would have been difficult to justify had it been clearly understood. Sandro Boeri sums it up in a damning remark. “To have asked the right questions of business units, senior executives would have had to engage in a debate that was beyond their competence, in a language they did not understand.” To remedy this situation, financial institutions must be confident that they have sufficient risk expertise at the most senior level. They should have the tools and information at their disposal to understand the institution’s risk appetite and positions, and there should be appropriate channels of communication to ensure that material information about risk is passed to the appropriate executives and board members, the paper says. It recommends that institutions should pay more attention to the data that populates risk models, and must combine this output with human judgment. One feature of recent financial innovation has been the trend for quantitative techniques to replace human judgment in evaluating trading oppor-

tunities, valuing assets and measuring risk. In banks, the reliance on models based on increasingly complex mathematics proved doubly damaging: not only did the models fail correctly to register the true levels of risk being assumed, but the sense of security they gave, both to banks and to their regulators, allowed dangerous lending practices to flourish. Quantitative modeling in financial markets had been growing in complexity since the introduction of the Black-Scholes-Merton method for pricing options in the 1970s. Although an entire academic field has flourished in the wake of this initial innovation, the underlying principles of financial modeling remained – and remain – unchanged. “It’s not like physics, where, say, you can predict the alpha particles emitted by decaying radioactive material with great accuracy,” says Crosby. “We’re trying to assign a probability that a share price will hit a certain point in a certain period. We’re not particularly good at it.” The collapse in 1998 of Long Term Capital Management, a hedge fund run by Scholes and Merton, should perhaps have brought a more fundamental re-evaluation of their methods than it did. In the event, the most widespread variant of the new financial techniques, Value-at-Risk, or VaR, remained a key risk management tool. VaR, introduced by JP Morgan in the late 1980s, aims to calculate the probability of future losses given past market performance and to encapsulate this in a single number; for instance, at a given confidence level, what is the biggest loss the institution can expect from a given portfolio? There are two problems with this. First, if past market volatility is for some reason not comparable with future performance, the model will give the wrong result. In hindsight, this was almost inevitable in the lead-up to the

credit crunch. Volatilities in most asset markets had been on a downward trend for over a decade, and this trend had accelerated during the extraordinary period between 2003 and 2007. Instead of recognising this for what it was, the sign of an unusually extended business cycle reaching maturity, financial institutions, leading regulators and many market experts argued that it reflected the success of financial markets unfettered by regulation. The second problem is that, if the model is based on a mistaken assessment of the probability of problems arising, the bank is more likely to find itself in the ‘tail’—the portion of potential loss that is above the confidence

level set by the bank. In the tail, there is no theoretical limit to the size of the potential losses. Since financial institutions had used the new financial architecture to increase their own borrowing on a vast scale, the losses were sufficient to drive some of the sector’s biggest names to the wall. This illustrates the point that to blame the models is like blaming the car for slipping on an icy road. No matter how sophisticated, models are limited by the quality of the data feeding them. Indeed, models tend to magnify even small errors in inputs such that these render the output dangerously wide of the mark, the paper points out. Even with the best data, responsibil-

If corporations are unable to enforce this discipline on themselves, then the success of risk management in heading off future crises will depend on the ability of governments and regulators to design and enforce rules that do the job for them BANKING AND BUSINESS REVIEW

May 2009 7

ity ultimately rests with those deciding how the models are used. No risk management tool should be used in isolation, and quantitative methods should always be backed up with qualitative approaches and the vital inputs of human judgment and dialogue, it points out. According to the whitepaper, stress testing and scenario planning can arm executives with an appropriate response to events. Stress testing and narrative scenarios have long been recognised as important tools in the risk management arsenal – both by management teams and banking supervisors. In the boom years, however, such tools lost ground to the apparent mathematical precision of quantitative analytics. Given the results delivered by those quantitative models, it is not surprising that stress tests and scenarios are making a comeback. Correctly used, these techniques can help financial institutions to gain a clear understanding of the impact of severe but plausible scenarios on their financial position. In theory, stress testing should help institutions prepare for the kind of highly unexpected, ‘tail risk’ events that we saw during the financial meltdown of late 2008. Yet in reality, few banks could claim that their stress testing processes were sufficiently robust, both before and during the crisis, to give them the warning that they required. The crisis has highlighted a number of important deficiencies with current stress testing practices. First, many institutions were overly conservative in the scenarios that they explored. They tended to assess the impact of relatively minor events, or to assume that market dislocation would only last for short periods. In addition, they often failed to take a sufficiently broad, firm-wide approach to stress testing, choosing instead to focus on specific risks or business units rather than exploring system-wide risk concentrations.

8 BANKING AND BUSINESS REVIEW

Such was the level of comfort among regulators and policymakers that in June 2005, months after the first rumours of strains in the US housing market were bubbling to the surface, Alan Greenspan, then-chairman of the Federal Reserve, would acknowledge only ‘signs of froth’ in certain local markets Second, stress testing tended to rely on recent historical data. The problem with this approach is that recent data refer to economic and market conditions that were unusually benign. When testifying before the House

May 2009

Committee on Oversight and Government Reform, Alan Greenspan, former chairman of the Federal Reserve, admitted the shortcomings of this reliance on recent data: “The whole intellectual edifice collapsed in the summer

of last year because the data input into the risk management models generally covered only the past two decades, a period of euphoria.”A third problem is that the incorporation of stress testing into the Basel II framework led some market participants to assume wrongly that the technique was primarily a box-ticking, compliance exercise. This devalued stress testing in the eyes of senior executives, and meant that the output rarely fed through into the strategic, decision-making processes at the top of organisation. In addition, it meant that insufficient effort went into developing robust and challenging scenarios that reflected rapidly changing external conditions. The other recommendations include consolidation of all risk factors across all the institution’s operations, caution against overdependence on data from external providers, careful balance between the centralisation and decentralisation of risk and adaptive rather than static risk management systems. The paper argues that while greater scrutiny of the activities of rating agencies will undoubtedly be on the supervisory agenda, it is clear that financial institutions must also recognise the

limitations of external ratings and risk information. In the run-up to the credit crisis, too many banks blindly relied on the assessments of rating agencies as an input, and were then left with no way of pricing risk when these ratings proved inadequate. This has highlighted the need for financial institutions to address their overdependence on credit ratings, and to supplement ratings with their own analysis, which should be continuously updated over the entire period of the investment.

In the wake of the financial crisis, credit rating agencies have come under fire from regulators, central banks and industry commentators. Critics have pointed out that they have an inherent conflict of interest, in that they are paid to rate securities by issuers, rather than investors. This could mean that rating agencies had an incentive to offer favourable ratings in the expectations of repeat business from issuers. “They got into the habit of issuing AAA ratings for fear of losing the account,” says Crosby. “They were not only negligent; they may have been fraudulent.” Serious doubt has also been cast on their models for pricing risk, particularly in the case of complex securities, such as collateralised debt obligations. Many CDOs were given top AAA ratings, despite being made up of risky, sub-prime mortgages. The models said that the instruments were safe because of the low default correlation between the underlying liabilities, but this was misleading. Commentators have also directed criticism at rating agencies for what is perceived to be the tardiness of their response to downgrade securities once the credit crisis hit. This, according to critics, raises questions about the robustness of the underlying models and methodologies used by the ratings agencies.

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PROPER C OV ER STORY TY

SIGNALS

Analysts see positive signs of an early pickup emerging

T

he worst may be over. While discussing the impact of the financial crisis on Dubai, most analysts had all along reserved their comment, on the ground that the real position would be known only by March-April as companies braced themselves for the earning season. Well, we are past that stage and the indications are not as bad as feared during what appears to have been the height of trouble in the fourth quarter of 2008. As companies start reporting their numbers, analysts are veering round to the view that things aren’t that bad. There has been a slight pickup in the stock market, which is a key indicator of the general confidence level and liquidity, which had almost dried up

10 BANKING AND BUSINESS REVIEW

completely, is beginning to reappear, although it continues to be a far cry from the required levels. Banks have apparently resumed lending, though with a great amount of caution and selectivity, suggesting that operations may be getting back to some kind of normalcy, at least in segments of business and pockets of activity. The first round of scaling down in operations and staff size, particularly in the property sector and related services, seems to be over and there are very few numbers to support the fear that the much-discussed exodus of expatriate population has actually taken place, although reports continue to appear in the media that large numbers of families are leaving. Immigration authorities insist that they are issuing more new residency and entry permits

May 2009

Analysts say the confidence level in the economy has improved significantly, particularly after the successful $10 billion bond issue by the Dubai government than those that are cancelled. Analysts say the confidence level in the domestic economy has improved significantly, particularly after the successful $10 billion bond issue by the Dubai government. Government officials point out that the full subscription

of the bond by the Central Bank helped to re-infuse confidence in the national economy by assuring that there is enough money in country. Also, in-

ternational financial institutions have responded positively to the prospect of a second $10 billion tranche of bonds, which the government plans to issue soon, they asserted. The UAE central bank has been playing a highly pro-active role in handling the crisis and the plan has produced good results. As a first step, the central bank injected liquidity of Dh50 billion into the banking system, and initiated a series of steps and policies to restore economic growth. These included the swap and repo facility for banks and the discount system on bonds issued by government entities and companies. The central bank has announced that it is in continuous consultations with the banks on the issue of large exposure limits to borrowers compared to those approved for Basel-1 and applied in GCC countries. The regulator is constantly reviewing the ratios for banks to avoid major risks during the financial crisis. The effect of an improvement in liquidity is already visible, with banks resuming corporate lending activity to some extent and reopening mortgage lending to property buyers, though this is mostly confined to Abu Dhabi

projects and is in strict adherence to new stringent guidelines in terms of loan to value, eligibility for lending etc. Also, the virtual freeze on payments in the market seems to have been lifted to some extent. EFG-Hermes said in a report that despite the announcements that some banks are loosening their lending conditions on personal loans and mortgages, the credit environment remains tight with banks remaining cautious. Any mortgage loans will continue to be based on low risk cases and on a relatively low loan to value basis. The report maintained that the forecast was for the UAE to see the sharpest drop in credit growth to the private sector of 12 per cent this year. This figure will, however, be supported by the low base effect from December 2008, when the banking sector is expected to have severely reduced new lending as liquidity dried up and concerns over the property sector mounted, it said. Nasser Bin Hassan Al Shaikh, director-general of the Department of Finance, has said that Dubai government-linked companies should settle all overdue payments within a month as they use funds from a $10 billion state support facility. He said disbursements from the fund have already started. “We are talking about big sums here,” Nasser said in an interview. “The bad days are over for the economy, which is stabilising and will gradually recover”. He indicated that most of the support will be offered to the property companies since ‘they are the pillars of Dubai’s economy’. The Department of Finance will announce an overall figure for funds paid out and approved for disbursal ‘very soon’ but not the companies that have received help, he added. While there are indications that funds are being disbursed, analysts have noticed that there is a conscious effort not to give out the numbers. Nakheel CEO Chris O’Donnell, for instance,

confirmed the other day that the company has started receiving funds from Dubai Government. But he refused to divulge the amounts in question. “The actual figure is confidential and so are all the other details. But yes, Nakheel is receiving funds,” Chris O’Donnell was quoted as saying in an interview. Standard Chartered Bank said in a recent report that the worst of the global financial crisis may be over for the UAE as tourism remains strong, global trade stabilises and oil prices rise. “There are signs that the economy is already bottoming out,” Standard Chartered economist Marios Maratheftis said in an interview. “But you still need policy to help,” he said. The $20 billion bond programme announced by Dubai government and underwritten by the UAE central bank would help pay back debt of government-owned companies, it was felt. The bank feels that the UAE economy may start to grow again in the second half of the year, allowing the country to report marginally positive expansion over all of 2009. Such assumptions have been encouraged by the fact that there is a consistent pickup in crude oil prices as well. Department of Tourism and Commerce Marketing (DTCM) said in a statement that Dubai’s hotels accommodated 1.89 million tourists and generated Dh4.26 billion in revenues in the first quarter of this year, a five per cent increase over the corresponding period in 2008. Also, the number of operating hotels and hotel apartments rose to 519 in the first quarter this year, up from 475 during the corresponding period in 2008, it said. The hotel capacity reached 40,864 rooms in the first quarter of 2009, up by 17 per cent from the same period in 2008, at a time when the global travel and tourism industry has taken a hit due to the financial crisis, the department pointed out. Other positive numbers have also been cited. According to DIFC Gover-

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nor Omar bin Sulaiman, Dubai’s economy recorded two per cent growth in the first quarter of this year compared to the same period in 2008, sending a clear signal that the emirate has weathered the worst phase of the financial crisis. Addressing the British Business Group, the DIFC governor said the UAE Central Bank’s conservative policies helped greatly to ward off the impact of the global financial meltdown on the financial services industry. “The Federal government and the Central Bank are working very closely to steer the economy back to normal with liquidity injection and other fiscal and monetary measures.” According to him, the major challenge the UAE economy faced at the onset of the meltdown was a crisis of confidence. People were shaken, and it took several months to come to grips with the new reality. Similarly, real estate consultancies are reporting early signs of confidence returning to Dubai and Abu Dhabi as property listings dry up and owners prefer to hold their properties rather than discount prices further to attract immediate buyers. Owners are choosing to lease their properties as a cash-generating alternative to selling. The leasing market in Dubai is still strong, showing continued interest from internal relocations and excess demand from Abu Dhabi,” Jesse Downs Director of Research and Advisory Services, Landmark Advisory, was quoted as saying. Another such report said the pace of decline in apartment rents in some sought-after areas of Dubai has slowed during MarchApril after recording steep falls in the beginning of the year. The report by Asteco suggests that while rents have dropped across the board from March to April, the average fall was in single-digits only, signaling that a probable market stabilisation trend may be in the offing.

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S&P puts Emaar, other Dubai entities on credit watch

S

tandard & Poor’s Ratings Services said it has placed the ratings on Dubai-based government-related entities (GREs) on CreditWatch with negative implications. The entities in question include DIFC Investments, DP World, Jebel Ali Free Zone, the Dubai Multi Commodities Centre Authority (DMCC), Dubai Holding Commercial Operations Group (DHCOG), and Emaar Properties. In addition, notes securitized by cash flows from a revolving pool of existing and future receivables originated by Dubai Electricity and Water Authority (DEWA), as well as the notes issued by JAFZ Sukuk Ltd have been placed on CreditWatch with negative implications. “The CreditWatch placements reflect our opinion of the likelihood of downgrades of the rated GREs and the notes if the potential for extraordinary government support to the Rated GREs and the notes is not affirmed by the government of Dubai,” Standard & Poor’s credit analyst Farouk Soussa said. “The need for Dubai government support is potentially increasing in the face of deteriorating fundamentals for some of the Rated GREs.” S&P said the action results from the learning that a review of debt strategy at Nakheel may include the possibility of a debt exchange. Recent media reports indicate that Nakheel is opening a dialogue with existing holders of its $3.5 billion sukuk coming due in December 2009, with a view to restructuring the debt. Standard & Poor’s has discussed these reports with Dubai World and has been told that ‘all options’ in dealing with outstanding liabilities are being considered as part of an ongoing review, including a restructuring, the agency said. S&P said it has also invited comment from the government of Dubai, which has declined to either refute the possibility of a debt restructuring at any of its rated GREs or to provide clear assurances that all debt obligations of the rated GREs will be met in a full and timely manner as per their original terms. The agency pointed out that the primary reason the mere possibility of a debt restructuring in an unrated Dubai-based GRE has been sufficient to trigger a review of all the

May 2009

rated GREs and the notes is due to the fact that such a possibility stands at odds with S&P’s prior expectation that the government of Dubai is committed to providing extraordinary support to its key GREs, including the rated GREs, in order to allow them to service their respective obligations in a full and timely manner. This expectation is based in part on repeated representations to Standard & Poor’s and to the public by senior government officials and other highly placed individuals, that the government of Dubai is committed to providing such extraordinary support, the agency said. S&P said that in accordance with its published criteria, a GRE is rated between the inclusive bounds formed by the GRE’s standalone credit profile and the government rating, with the placement along this rating spectrum a function of assessment of the potential for extraordinary government support. All of the rated GREs reflect government creditworthiness more than stand-alone credit profiles, though this may shift should the government’s support commitment ebbs. “In our view, the consideration of a debt restructuring in any key GRE, particularly if it were deemed to be ‘distressed’ increases the uncertainty as to Dubai’s intention to provide adequate support in times of stress”.  “At this stage, we have not had confirmation as to Nakheel or the government’s intentions with respect to Nakheel’s outstanding sukuk. The CreditWatch placement will hold for the duration of our review, which will focus on confirming these intentions, and then assessing the impact this may or may not have on our view of the likelihood of extraordinary government support with respect to the notes, and each rated GRE and its respective obligations,” Soussa said. S&P said it will resolve the CreditWatch placement once the analysis is complete. There is a significant likelihood that the review may result in the downgrade of one or more entities or notes by one or more notches, depending on its assessment of the likelihood of support on a case-by-case basis, and on the stand-alone creditworthiness of each entity and its respective obligations.

SPECIAL

EXECUTIVE

EDUCATION PROPER TY

TO TRAIN OR NOT TO BE

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May 2009

Executive training programs get a boost as employees press hard to remain relevant By Ambily Vijaykumar

A

well-attended forum in Dubai last month saw management guru and author Dr Stephen Covey and his son give lessons in trust and leadership to members of the UAE corporate world. Sprinkled with skits and anecdotes, the forum raised some important questions for corporate executives to chew on. Central to the theme of Dr Covey’s presentation was a question. Are you relevant? Are you current? The question has assumed immense significance in the wake of the global economic crisis and the redundancies that have been affected as a result. Historically the best in the corporate world have constantly re-invented themselves to stay in the market. The Nokia story, for instance, is one of continuous reassessment. The 140-yearold company that holds 40 per cent of the world’s share in the cellular phone market began as a paper manufacturer. They then moved on to making rubber boots and raincoats and today they are the front runner in the world of mobile phones. A parallel to this story can be drawn to an individual’s role in an organization. The significance or relevance of an individual in an organization too is directly proportional to the investment that the individual makes in himself or herself. That investment is for upgrading skills and knowledge base. “Constant development is the key. Professionals should develop a creative culture to adapt to the crisis and to optimize the opportunity of a crisis,” says Dr Covey. “Never waste a crisis, because it is an opportunity to make significant changes and improvements in order to

make sustainable competitive advantage,” he explains. One of the time-tested methods of improving has been to revisit education. The trend is catching up in the UAE whose workforce has been facing the onslaught of layoffs. The global economic crisis has given professionals and organizations an opportunity to do some soul-searching in terms of where they stand. Several institutes in the country say that there is a growing demand for education programs for professionals in the UAE. Professionals now believe that in order to survive in an acutely competitive market, it is essential to acquire new

“In the current scenario, people have felt the need for risk management and also felt the importance of managing their corporate governance. In fact, the present crisis is the result of lack of prudential norms in terms of banking and lending. So people want to reorient themselves and take a cue from the current crisis as a sort of learning for them,” says B Narayanan Murthy, Head of Training at the Emirates Institute for Banking and Financial Studies in Sharjah. The institute has registered about 30 per cent increase in the number of students attending its executive education programs so far this year. Growth is

The significance or relevance of an individual in an organization too is directly proportional to the investment that the individual makes in himself or herself skill sets. Individuals who are facing or may face prospects of a job loss are considering taking a brief break to study so that they can open up more avenues of navigating the job market with their newly acquired skills. Also they hope to re-enter the job market, equipped with the ability to negotiate a better deal. Those who do not have the sword hanging on their head, however, want to hone their skills so as to stay current. The teetering banking sector in the UAE is showing considerable interest in management programs.

also the catch phrase for executives who are facing the daunting task of securing their job as well as staying relevant in their organization. Multi-tasking individuals are in huge demand these days since companies trying to reduce costs drastically are demanding more for less. This is exerting pressure on those in important positions trying to move up the corporate ladder. Not only can they not afford to quit in times of extreme uncertainty, they cannot afford to be

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laid back in terms of job security. It is executives of this kind who are knocking on the doors of institutions, looking for value addition to their knowledge basket. Companies are also putting employees under the scanner to sift the best from the rest. Performers are being assessed on the basis of their abilities and are put in ‘right positions’ and given more responsibilities to get the most out of them and lesser performers are being asked to go. This does not, however, mean that corporates are not looking for fresh talent, but the new talent now has the onerous task of meeting higher expectations in terms of skills and ability. The market slowdown has ensured that many professionals also have to operate outside their field of expertise. For instance, many marketing professionals are being asked to switch to human resources management within their companies. Since marketing is one such department that is looked upon as a luxury in any organization, in times of acute cash crunch, several organizations are also going in for optimizing their existing staff rather than downsizing. Such a situation also calls for a quick brush up of knowledge, say institutes. “Such students need a quick brief about their new job so executive education programs are the best remedy,” says Deepali Tulpule, Corporte Education Manager at the Centre for Executive Education in Dubai. Traditionally organizations have a budget earmarked for training and development of their human resource. But during a recession this budget is reduced, if not scrapped. Several corporates are faced with this reality, but others are utilizing this crisis to invest in their human capital so that when the crisis ebbs, they have a pool of upgraded individuals working for them. “Training and development is a vital part of our organization. We have a

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full program of executive management and training. We also sponsor regular courses for our employees. The development of human capital is priority for us and we are not only concerned with technical skills but we also believe that

developing managerial and leadership skills are equally relevant,” says Osman Sultan, CEO of Du. Companies also have qualifying criteria for employees for financial sponsorship for education programs.

“Never waste a crisis, because it is an opportunity to make significant changes and improvements in order to make sustainable competitive advantage” May 2009

This is another incentive for staffers to up their performance index. Circumstances might not allow companies to permit employees to take a break or invest considerable time in education. In situations when an employee, who has spent several years in an organization acquiring a vast knowledge of the specific field, is promoted to a managerial post by the organization without any proper training in management, the organization might not be in a position to invest time and money in a long-term program for the person. The answer to that are short term training programs offered by various institutions across the UAE and also in-house programs organized by various institutions to suit specific requirements of organizations. Institutions say these courses help professionals acquire skills to manage the new resources around them whether it is budget or people. Short term programs, typically lasting anywhere between one and five days, are the preferred lot. But here too, companies prefer to have these sessions organized in-house so that they can optimize on the investment required

Emirates Institute for Banking and Financial Studies has registered about 30 per cent increase in the number of students attending its executive education programs so far this year for them. The interesting part is that executives with MBA degrees who have been through the grind of corporate life also opt to be part of the short term training programs. The reason for that lies in the topicality of the program. “When a person begins an MBA, the market conditions are very different from what they become once the course is over, which is typically a two-year period. To adapt to the changed market setup becomes another big challenge. What these training programs do is offer a methodology to tackle a current situation in an organization since they are mostly tailor made to suit the company’s needs,”

informs William Franklin, Client Relations Director at Maven Management Training Centre in Dubai. This experiential learning enables students to get insights to apply and make them reflect in the requirements of their work place. The motive for students is also to bury insecurity with regard to their capability that is bound to arise in recessionary times. A program that enables executives to learn to deal with an unprecedented situation like the one that has gripped the world economy today is also what increases its appeal. “Companies are looking for answers to the crisis that has caught everyone unawares. There is a thirst to find ways to exit the situation. Maybe conventional programs might take a backseat with people looking for innovative methods to tackle the crisis,” says Professor Christopher Abraham, Senior Vice President of Business Development at the S P Jain Institute in Dubai. Innovative methods of problem solving, creativity, out-of-the-box thinking and also human resources practices during a recession are likely to find more takers over traditional programs this year. Reasons for this being budgetary and time constrains for companies who traditionally invest in these skill upgradation programs for their employees. Since the programs are designed with specific company requirements in mind, at the end of the program, institutions claim executives

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Flab has to go Depleted management capability would not augur well for companies

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rganizations are ‘reducing fat’, as one of the leading recruiters chose to describe the current rate of downsizing going on around the world. Companies have to remain ‘lean’ to continue to stay ahead in the market race. The ‘fat’ in question here are employees who have for various reasons been deemed ‘inconsequential’ by their organizations. Only those who the company thinks are ‘value additions’ at this time are being retained. These employees are experienced, multi-talented and keen learners. The company reposes faith in them because they have faithfully nurtured their abilities. Widening their horizons is second nature to them. It is for such professionals that companies invest in what is called training and development. Prior to the economic crisis, companies had a set budget for this purpose, but that budget has surely been hit with the all round scaling down of spending. That has left organizations with a new set of problems, says the Dean of the School of Management and the Bradford University, Professor Arthur Francis. “Levels of interest in executive education programs remain high, but companies are finding it harder to find the money to pay for such programs. Business Schools around the world are reporting a downturn in executive education activity, leading to the danger that firms will come out of the current crisis with a depleted management capability, particularly amongst junior managers who in the better days would have

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Professor Arthur Francis

been going through training programs to assist their development as managers.” That depleted management capability would not augur well for the prospects of any organization once the market rebounds. Hence institutes are offering tailor-made programs to companies to suit their industry-type and requirements. The focus of these training programs, typically lasting one to five days, is to develop soft skills among those in management positions. These skills include team working, leadership abilities, and decision-making skills and are offered generally to a group of people within a company who are largely in senior management positions. Apart from these, executive education also caters to two other categories of professionals. There is general management training for people whose initial training is in technical areas such as engineering or IT and who are now moving into a management position and need to know how to manage. The

May 2009

second category is for those who need to upgrade their skills in particular areas such as finance, project management or marketing. “What you learn must be relevant to your organization. The learning that goes on in our programs becomes embedded in changed behaviour back at the firm. We work closely with companies before, during and after the education events to ensure that what is learnt is applied as participants go back to their jobs in the company,” explains Prof Francis. The Bradford University MBA program in Dubai began as an in-company program for the Emirates Group. Participants came from many different backgrounds, including pilots and other airline related jobs, as well as others doing more generic back-office functions such as logistics. But now the university has participants from across a whole range of industries in the emirate. Professor Francis says that the need for executive training has become ‘absolutely necessary’ in the present market. “The MBA is the gold standard, but not everyone has the time to commit to this and MBAs need to maintain the currency of their management knowledge by doing executive education after they’ve completed their MBA,” he opines. The university offers one-day courses to two-year programs with 80 professors at the UK campus available for their Dubai campus as well. The university says it is already in discussion with interested parties in Abu Dhabi for opening a branch in the capital.

Enthusiastic response Organizations are waking up to the reality of investing money in their most precious assets, says Maven Management Training Centre Director

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ccording to a survey conducted by Bayt.com, 65 per cent of professionals in the Middle East are worried about job security. The UAE has a particularly high percentage of professionals concerned about job security with the figure standing at 74 per cent. Another aspect that the survey brings out is the uncertainty regarding the future of organizations. Fifty nine per cent of those surveyed in the UAE say they are not confident of the future of their company. The survey was based on a sample size of 10,000, but is reflective of the prevalent mood in the region in general and the UAE in particular. It may be contrary to the approach that many are taking to tackle the crisis. Optimizing talent in times of uncertainty is what many individuals and organizations are doing to survive in existing market conditions. Sharpening one’s skill sets and acquiring more knowledge is becoming the new means of getting ahead of fierce competition that has been generated as a result of shrinking opportunities and piling redundancies. The demand for education among professionals is on the rise with institutes claiming that many organizations are laying the foundation to deliver training programs for their staff later this year. “The response so far has been enthusiastic,” says William Franklin, Client Relations Director at the Maven Management Training Centre in Dubai. Organizations are waking up to the reality of investing money

in their most precious assets; human capital. The recession has meant that corporates have yet not commissioned assignments to the institute but they have set aside time post Ramadan this year to train their staff. Organizations are looking for solutions to negotiate the financial crisis while preparing their workforce to meet the challenges that will arise once the market starts steadying. The institute claims that its accredited programs help people follow a methodology to bring changes in their organization. “It gives them confidence that even if they have been undertaking the same job, their job does not change, they can change their approach. So even if they get distracted or they get lost, they know they can refer back to a common route map that has been proved as being the best practice,” says

William Franklin

William Franklin. Companies that are going slow on the hiring process are concentrating on upgrading their existing staff by giving more responsibilities to individuals who have spent a considerable amount of time with them and have acquired technical expertise in their area of work. In situations where a person has been promoted to a post that requires managerial expertise, but lacks the required skill sets to handle people

Organizations are looking for solutions to negotiate the financial crisis while preparing their workforce to meet the challenges that will arise once the market starts steadying

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or money, workshops that orient them and equip them with the skills to do that are gaining importance. Conventional business courses like the MBA, says the institute, demand huge investment in terms of time. But the short term executive education program that typically lasts about five days is a much-needed value addition. “We are in talks with Gulf University to embed our five-day program into their MBA, so you not only have your MBA but also an internationally accredited qualification to go with it,” Franklin points out. Maven Training Centre is accredited to the Association of Project Management Group, which in turn is aligned to the UK government. The Centre is also accredited to the Projects Management Institute which offers a qualification that is based on a US driven methodology. The training focuses on project and program management, change management, risk management and service management. The Prince 2 methodology that is used throughout the UK for any government spending in health, local government, defense, policing

and infrastructure is taught at the institute to enable executives to learn the means to optimize spending. The clients of the institute fall into two categories. First are individuals who might be looking to relocate and would want an accredited qualification that is recognized in the UK, Europe, US and Australia. The second group comprises organizations which know they need to have a properly planned development process where they can train their staff over a period of year or where they are looking to try and change or transform their organization particularly to deal with the current economic crisis. An interesting aspect about the institute is the faculty. They are largely

Companies that are going slow on the hiring process are concentrating on upgrading their existing staff by giving more responsibilities to individuals who have spent a considerable amount of time with them and have acquired technical expertise in their area of work

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May 2009

drawn from the UK and the demand for their expertise in the Gulf is very encouraging, says the institute. “The demand here is to learn from people who have already been there; both who have got it right and those who have erred. Professionals want to learn something that is of relevance to them,” says Franklin. With the student strength for training for each program restricted to 12, the institute says the course is a good platform for interaction not just with industry experts but also with peers, who exchange expertise and experience that help in devising methods to approach company or individual specific problems. Also the interactive experience in a risk-free environment adds to the allure of these programs. The return on training is 200 per cent, claims the institute and hence advocates the need to invest a fraction of the money that organizations have spent over the years on their staff in upgrading them and giving them an opportunity to grow for the benefit of the organization. Buoyed by the keen interest in their short term executive education programs, the institute says that it sees no reason why these courses can’t replace an MBA in the future. “The prevalence of MBA in the Middle East is very high but it is low in the UK and Europe. Executives in those countries benefit massively from these short term courses, because this is probably the only formal training they have after leaving university,” says Franklin.

are armed with a set of documents and learning that fine tune their learning to their actual work within the organization. Interactive sessions with industry insiders form the backbone of learning in these programs. Trainers or faculty are largely drawn from within the industry that not only bring with them their knowledge pool on subjects but also are able to weave it around real life experience and situations. For corporate professors, as some institutes would like to call them, the faculty experience range on an average would be between 15 and 25 years. Participants are also assessed through various problem-solving exercises assigned during the course of the program. This enables them to come out with solutions for the realworld work situations in a risk-free atmosphere. Since these programs offer a platform for employees of various companies to also come together, participants get an opportunity to interact with likeminded people and engage in expertise exchange as well. This is another opportunity that many might not get on a regular basis. Some institutes claim that the appeal of these courses has been such that professionals come back for the same course the following year, not because they haven’t learnt, but because they find the need to stay updated on the latest development in the field. The interest in these courses has been such that several institutions are taking it to another level. “While organizations are looking to equip staff with means to tackle the crisis, we are in talks with one of our corporate partners to develop a program that addresses management issues post the crisis,” says Prof Christopher Abraham of S P Jain Institute. Contrarily there are also institutes that are unhappy at the slashing of training and development budgets in several organizations. The fear they say is that of being left with untrained human resources once the economic crisis gives way to a stable market and there would be a need to accelerate growth. Many say that several corporates have expressed the desire to partake in these

training programs, but most of them want to wait till the later part of the year due to monetary constrains. Institutes also offer long-term part-time programs for working professionals looking for value addition. So will these programs topple the MBA in the future? The opinion is divided on this. Some say that an MBA is definitely the most sought-after course, but the changing dynamics of the corporate world has also opened up avenues for such custom-made training programs. But the short term programs are not an answer to the conventional management program. Others come out in support of the new teaching techniques saying that since these programs reflect the fluctuating ground realities, they will have more takers in the future. Another line of thought says that even if professionals opt for an MBA program, their knowledge base would be lacking without an executive education program.

The market slowdown has ensured that many professionals also have to operate outside their field of expertise; for instance, many marketing professionals are being asked to switch to human resources management within their companies

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Re-learning the basics Heightened interest for risk management, says EIBFS training chief

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ne of the primary reasons financial experts attribute to the global credit crisis is that the banking sector faltered with its basics. Unscrupulous lending has wiped off trillions from the world economy and the world is still reeling under its aftereffects. The problem has now become part of everyday life and hence the need is being found especially within the banking sector to right the wrong. So, several banks are revisiting their basics. A practice that has been part of corporate governance before the crisis set in is being followed more strictly: the practice of reorienting and consolidating individual knowledge base so that the sector can face the onslaught of the crisis. B Narayanan Murthy, the head of training at the Emirates Institute of Banking and Financial Studies, says that there is increased interest in the need for risk management and corporate governance. “The present crisis has been a result of lack of prudential lending norms by banks. People now want to reorient themselves and take a cue from the crisis as a sort of learning for themselves,” he says. The growing need is reflected in the institute’s student figures, especially in their executive education program. As compared to 2008, the number of students attending the program has grown by about 30 per cent so far. That is a considerable jump and the institute expects the number to further

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The second reason is that the training not only gets the employees a fresh perspective on ways to deal with the current crisis but also develop means to resolve the situation depending upon individual roles within an organization. So would it be right to say that the institute offers innovative solutions to resolve the current problem? “I would say that the origin of the present financial crisis is because the B Narayanan Murthy

grow with many more such programs lined up for the remaining year. The numbers are also a reflection of the job insecurity that has gripped the UAE banking sector. Downsizing has left many bankers stuck for options. The only way forward for most is to revamp their profile so that they can remain an asset for their organization. Likewise in the event of a jobloss, bankers want to have an edge over others in their industry, since the job market has shrunk and there is a clamor for limited opportunities. With the institute being a ‘nodal agency’ of the banking industry and about 52 banks regularly sending their employees for its training programs, it says that the sector finds it ‘economical’ to send staff to them. “Since we are part and parcel of the banking industry, employees are assured that they can get authenticated training from us,” Murthy adds.

May 2009

As compared to 2008, the number of students attending the program has grown by about 30 per cent so far and the institute expects the number to further grow with many more programs lined up for the remaining year

banks faltered with basics. So it is a question of re-learning best practices in banking. There is nothing new that we teach them. We only tell them what exactly has happened and why one should not revisit those critical problematic areas again and how to guard oneself from a similar crisis in the future,” Murthy explains.

The institute offers two kinds of programs: the basic level and the advanced level. People who take the basic level come later for advanced level programs. Sometimes people also come for the same program to update themselves. For example, a person who attends a basic level program on investment banking comes back the following year to attend the same program: the reason being that investment banking norms change from time to time. The experience range of any student coming to the institute is between zero and 20 years and the faculty which is from the banking and financial sector has an experience range of 10 to 30 years. There are close to 40 in-house faculty members at the institute. They also draw trainers from a pool of experienced industry experts from all over the globe. The strength of visiting professors is about 100. Practical experiential learning is the thrust of the program and the aim is to arm students with insights to apply and reflect to the requirements of their work place. “People with a certain background of executive education who come for programs are very focused in their domain area as they don’t like to be generalists. Our programs serve a better purpose than a general program on business education,” claims Murthy.

The institute has already trained 800 students in the first three months of 2009. It hopes to attract at least 3,000 participants by the end of this year. Executives have around 310 programs per year to choose from. One hundred and sixty seven of these programs are conducted from the Sharjah branch and the remaining from the Abu Dhabi branch. “All the programs are well-received so we hope to see our student strength grow to about 5,000,” says Murthy. With training becoming ‘serious business’, according to the institute, people want to take certain value propositions through them by undergoing the programs on offer. A typical program lasts for a maximum of five days. The twenty-five-year-old institute boasts of a ‘well-laid out infrastructure’ and also trains Emirati students for banking diplomas. With government patronage, the institute hopes to see good results this year in terms of student strength and demand for its programs. “2009 is a year of consolidation and we are already getting a lot of positive signals in terms of demand from the industry,” says Murthy. With an economic revival only expected by the end of this year or early 2010, the institute hopes to benefit from the uncertainty the market is presently facing.

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Break from text-book and class-room style learning Demand for innovative solutions is more than ever before, says VP at SP Jain

Prof Christopher

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ne of the characterizing features of a recession is insecurity. For obvious reasons, the insecurity is mostly work-related. Professionals, whether at the lower end of the job spectrum or on top, are not immune to this sentiment since an organization that they work for will determine their worthiness for it. Popular means to overcome this feeling is to make a concerted effort to upgrade one’s knowledge base so that the organization values the person’s contribution towards it. During recessionary times, most organizations are in the driver’s seat and they expect a professional to be more committed than before and also willing to do more

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for less. Multi-tasking is also another skill that professionals are expected to possess. This is a time that tests an individual’s skill sets and if lagging behind, a professional can be left in the lurch in the job market. “There is generally an uptrend whenever a recession takes place because people generally feel insecure and one of the ways in which they can minimize this is to enhance

May 2009

their skills and knowledge and one of the shortest ways to do that is to enroll in professional training programs. The catch is that the programs have to be relevant to their growth prospects,” says Prof Christopher Abraham, Senior Vice President, Business Development at S P Jain Management Institute, Dubai. Initiatives, largely on an individual level, are being taken by people who have so far not taken the prospect of

“We are tying up with one of our corporate partners, Dunia, to develop a program on how to manage after the turbulent times and what your strategies should be once the market turbulence is over” upscaling themselves seriously. They are using the recession as a reason to invest time and money for executive education programs that they believe will be their ladder to the top. Influencing practice is the key aim of the institute when it comes to designing their executive training programs. Using the latest frameworks on strategy, students are taught methods to develop plans that would apply for their company. “It is a break from the text-book and class-room style of learning. At the end of the program, students go back with a set of documents and learning that fine-tunes their learning to the actual work within their organization,” says Prof Christopher. Especially in the prevailing market conditions, the demand for innovative solutions is being felt more than ever before. Companies are now focusing on training their staff to understand recessionary trends so that they are better equipped to work during times when cutting costs and managing budgets and people become a challenge. “In collaboration with the Dubai logistics and supply chain group, we ran a two-hour seminar, where one of our specialists spoke on answers to the crisis for the logistics industry. There were close to 150 people who attended, looking for answers. There is a thirst for answers and probably the conventional programs might take a backseat for the moment, because people want a fresh perspective to the problem and a fresh approach to problem solving,” says Prof Christopher. Participants in the program can be

broadly categorized into two groups. One is the typical MBA who has been in a position of authority in an organization but wants to sharpen rough edges and stay abreast with latest trends and techniques in management. The other group is that of executives in high positions in a company who have risen from the ranks but do not possess the latest management inputs. The second group forms the largest chunk of participants. With executive education programs finding favour even with the true-blue MBAs, is that an indication of things to come as far as conventional business courses are concerned? “Both of them have different purposes. An MBA is a career enhancement program where people having the luxury of time and money can put in effort over a longdrawn period to achieve results. An executive education, on the other hand, is for those with work and travel commitments who do not have the luxury of time,” says Prof Christopher. These short-term programs are typically relevant to the times that the market operates in. Instead of hypo-

thetical scenarios, participants study and analyze real life situations prevalent at that time. “We are tying up with one of our corporate partners, Dunia, to develop a program on how to manage after the turbulent times and what your strategies should be once the market turbulence is over,” says Prof Christopher. Executive education is now one among the institute’s three areas of focus. There is a dedicated team working to design and develop programs for the institute. The institute is also looking at co-partnering executive education programs with various universities across the world. It is also focusing on forging new alliances with corporate partners to add value to the programs. Out-of-the box thinking for solutions is also what has brought the institute to the thresholds of finalizing the setting up of its biggest campus in the world in Sydney. “We think very contrarian. We are looking at this as an opportunity for growth as compared to those who are depressed and waiting for something to hit them tomorrow,” says Prof Christopher.

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When job seekers invade Facebook The increasing popularity of online social networking is changing not only the way people manage their careers but social networking itself By Prof Soumitra Dutta and Dr Matthew Fraser

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s the downturn continues, millions of corporate managers—gripped by the job jitters—are rushing to join online social networks in a scramble to build their social capital. The popularity of sites such as LinkedIn is soaring: less than a year ago the site had little brand profile and was seen mostly as a venue for corporate suits trolling for professional contacts while plotting their next career move. Facebook, by contrast, has largely attracted individuals seeking a compelling site for fun social networking. Today LinkedIn’s year-on-year growth is up nearly 200 per cent in the United States and it now has more than 35 million members—many of whom were formerly employed within the hardhit financial sector. And it’s just one of the many sites to which recession-struck managers are flocking: Xing (based in Germany), with its 7 million members and special Lehman Brothers alumni section, and Meet the Boss (based in the United Kingdom), which restricts membership to C-level financial types, are also experiencing burgeoning membership levels. This surging popularity of online social networking is transforming the nature of business networking, with profound implications for the way business people manage their careers. But it also augurs profound change for social

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networking itself. With so many people stampeding into Web-based social networks, the line between social and business networking is becoming increasingly blurred. An important question is whether the values and codes of conduct specific to the virtual world will come into conflict with real-world values and norms. Facebook, where the idea of a ‘friend’ is directly embedded in the interface, is increasingly cluttered with self-promoters, career artists, and marketing entrepreneurs. What happens as this trend intensifies and those using Facebook exclusively for career networking invade? There are, of course, powerful economic reasons behind the trend. As sociologist Nan Lin puts it in his book, Social Capital, “Individuals engage in interactions and networking in order to produce profits.” These profits are based upon information, influence, social credentials, and recognition. The accumulated social capital, meanwhile, helps individuals to gain competitive advantages in the labor market as a result of privileged access to ‘resources’ located on the social networks. Still, for many there’s nothing more irritating than when a new ‘friend’ contacts you almost immediately with an inappropriate request for a favor. Generally, it’s more advisable to approach social networking as a giver, not a taker, and gradually build relationships according

May 2009

to reciprocated favors. Overall, online social networking, with its support groups and trusted access, is governed by a culture of sharing, not selling. And can the throngs of interlopers really be considered friends? Anthropologists tell us that it’s impossible to maintain stable social relationships with more than 150 people. Maintaining a professional network of more than 150 looser connections on LinkedIn might be plausible, but it would strain the richer social relations that make up the fabric of sites such as Facebook. Among Facebook’s 175 million members, the instances of ‘de-friending’ are already growing. It’s a safe bet that if the economic downturn grinds on, we will witness further conflict between the non-rational instinct to connect socially and the rational calculation to build social capital for professional reasons. If so, it may put further strain on the notion of an online friend. We may find ourselves asking more frequently that age-old question, “What are friends for?” Professor Soumitra Dutta is the Roland Berger Chaired Professor of Business and Technology at INSEAD, where Dr Matthew Fraser is a senior research fellow. Their book, Throwing Sheep in the Boardroom: How Online Social Networking Will Change Your Life, Work and World, was published by Wiley in December 2008. Credit: McKinsey Quarterly

Plugging Arab brain drain Shift from recruitment to retention and training seen as need of the hour

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he past six to eight months has seen thousands of expatriate executives leave the Middle East. Some have left in search of more rewarding compensation, but the majority have no work to keep them here. The Middle East economy will suffer due to its reliance on the expatriate expertise that helped set up the recent boom years, but there is now less demand for those experts who, in turn, have less opportunity to justify the generous remuneration they were used to. As the Middle East loses senior executives in its own ‘brain drain’, the need for talent retention is greater than ever. In an effort to minimize the chain effects of the current economic climate, Heidrick & Struggles, senior-level exec-

utive search and leadership consulting services, is shifting much of its focus away from recruitment and more towards retention, education and talent management and development. With many of the expatriate senior executives leaving the region, Heidrick & Struggles says its mission is to encourage the indigenous Arab population to be less dependent on foreign skills in the future. According to Jon Boyle, Heidrick & Struggles partner in the Industrial Practice based in Dubai, “The intention was always there to learn from expatriate experience, but in reality, as soon as one expat left, another was recruited. Many of those who brought their experience from abroad have now left. With the economic climate as it is, the reason

Many of those who brought their experience from abroad have now left and with the economic climate as it is, the reason they came has also gone

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“There is a very real concern over the number of expatriates who are leaving the region. It isn’t there yet, but there is a danger that many essential foreign skills and expertise may reach critical mass in some parts of the Middle East” they came has gone and they have gone with it. “There is a very real concern over the number of expatriates who are leaving the region. It isn’t there yet, but there is a danger that many essential foreign skills and expertise may reach critical mass in some parts of the Middle East”, Boyle says. But for some time to come though, there will be positions in certain sectors that will be filled by expatriates through sheer necessity said Paul Benson, Partner at Heidrick & Struggles MENA, who specializes in executive level search assignments for energy clients. “Nuclear energy, for instance, is very much part of the Middle East agenda in the near future and the UAE is looking at as little as the next five years for that to become a reality. This is obviously an enormously specialized field and there just isn’t the experience or expertise here,” he said. “This is a great opportunity for many of the younger nuclear engineers and executives to assume a level of responsibility that would not be available to them in their home countries. It’s by no means a case of them not being ready for the position; these are enthusiastic young men and women who have the opportunity to prove their ability without going through the extremely rigid and sometimes unnecessary industry structure in many other parts of the world,” he added.

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“At the other end of the spectrum are highly experienced people who want to mentor new talent. These executives are maybe aged between 50-55 years old and are looking for an advisory role in a new location, with all the benefits of an expatriate package and the excitement of introducing and overseeing a totally new industry for the region,” said Benson. The reasons in any sector for a move to the Middle East have always been many and varied, and apart from the compensation, among the most common factors are the high standard of living, family education and safety, valuable work experience and the potential to save. A comprehensive Heidrick & Struggles survey published recently gives a breakdown of some of those factors among senior level executives, and where they saw the greatest potential to meet those factors. “Many of the results are to be expected, but there are some surprises,” Mr Boyle said. “The UAE comes out on top of many of the categories, apart from the potential to save most money. Here it ranks sixth below Saudi, Kuwait, Qatar, Bahrain and Egypt in that order. “So there is obviously a large compromise in how expatriate executives choose their Middle East destinations. It isn’t purely the compensation package. All these other factors have to be taken into account as well.”

May 2009

The quality of education results show that Lebanon is second to the UAE, with Bahrain coming third. “If we break this down even further, we can see that the resident and nonresident Arabs feel that the level of education in Lebanon is extremely high, but the non-Arab expatriates rate it in sixth place. There are so many variables, and so many priorities, there are always going to be contradictions,” Boyle added. “It’s all a case of timing.” And Boyle believes Dubai’s timing in particular has been totally spectacular. “Dubai has perhaps taken such massive leaps in such a short space of time, there wasn’t the opportunity to take stock and assess the reality of the situation. But that has been the same across the world. The difference is that much of the rest of the world is supposedly a mature market, whereas Dubai is not. “There were many expatriates who rode on the back of Dubai’s success, and were not necessarily as qualified as they should have been for the positions they held. Now we are seeing more mature Emirati leaders who will attract more mature foreign executives. A positive outcome for this whole situation is maybe that national and expatriate professionals in all fields take a more pragmatic view of why they are here, what they are doing and what their future holds.” And it may be that which helps plug the drain.

PROPER C OMMODITIES TY

DGCX rupee futures are hot Currency futures emerging as most attractive asset class, says CEO

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f you think that currency futures being traded on the Dubai Gold & Commodities Exchange (DGCX) are meant only for those thick-glassed veterans with heavy cash chests waiting to pounce on any arbitrage opportunities or young MBAs with fancy specializations striking deals on their gizmos at the speed of lighting, you are mistaken. Currency futures do meet the sophisticated requirements of investors as an alternative asset class as well as the needs of trades and businesses to better manage currency exposures, but they also serve as an effective tool to protect the value of remittances salaried people make from their hardearned incomes.

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“Currency futures are becoming the most attractive alternative asset class in the UAE, led by continued price volatility and a focus on currency risk hedging strategies”, says Malcolm Wall Morris, Chief Executive Officer, DGCX. Malcolm says trader members are reporting good response to some of the currency futures products, particularly the Indian rupee and the pound-dollar contracts, from individuals who are keen to protect the value of their cash against future uncertainties. Asked about the threshold level for opening a trading account, he said it was an issue between the individual and the broker and the exchange was not involved.

May 2009

DGCX is hosting a series of professional training workshops, aimed at helping individuals better understand the trading and price risk management benefits of derivatives

As the only exchangetraded rupee futures contract outside of India, the DGCX rupee futures contract opens numerous trading opportunities to both local and international participants The exchange is hosting a series of professional training workshops, aimed at helping individuals better understand the trading and price risk management benefits of derivatives. Recent volatility in the Indian rupee compared to the US dollar has been as high as 40 per cent, which can leave businesses and individuals exposed. The futures contracts offer the financial tool to manage this price risk.

Malcolm Wall Morris

Market participants can currently trade futures for a range of currencies including: Indian rupee-dollar, eurodollar, British pound-dollar and Japanese yen-dollar. These contracts offer market participants with an attractive mechanism to hedge their price risk and exposure to foreign currencies. The interest for Indian rupee-dollar futures contract has gone up significantly in recent months. As the only exchange-traded rupee futures contract outside of India, the product opens numerous trading opportunities to both local and international participants. The DGCX Indian rupee futures contract is a natural extension of the forwards market and meets the market’s needs by offering a significantly lower cost and safer method to trade

the currency. The contract provides several advantages, the most significant being transparency and guaranteed settlement for market positions. India’s rapidly growing trade flows, increased cross border investments and the fluctuation in exchange rates, have created a corresponding requirement to hedge risk as individuals and businesses have exposure to volatility in the Indian rupee-dollar rate .  So, traders, arbitrageurs, importers, exporters, and local businesses are all benefiting from the offering. “The ongoing volatility in the currency markets will continue to encourage market participants to hedge their exposure to foreign currencies. From a long-term perspective, currency futures are especially beneficial to both individuals and commercial entities with investments abroad or those who are planning to invest abroad,” Malcolm pointed out. Currency futures emerged as the key driver of volume for the DGCX in 2009, after the exchange saw volumes drop significantly in the last quarter of last year in the wake of the global financial crisis. The exchange had even suffered the loss of a number of brokers and trading accounts during this period. But the first quarter saw confidence returning to the market, with the new year beginning on a positive note and month-on-month volumes increasing steadily. Total first quarter volume for the exchange was 212,485-70 per cent up on the previous quarter, but down by 33 per cent on the same period last year. Similarly, year-on-year volumes in April continued to grow with a 14 per cent increase compared with the same month last year. The exchange traded 98,322 contracts, valued at $4.4 billion during April. The growth was driven by higher volumes in Indian rupee-dollar futures, as well as gold and WTI crude oil volumes. In fact, trading in the rupee-dollar futures more than doubled, with the average daily volume standing at 4,682 contracts in April, a 19 per cent increase on April last year, Malcolm pointed out. Volume for gold futures grew by 173 per cent month-

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May 2009 31

on-month, valued at $1.3 billion. Similarly, volumes in March 2009 were the highest ever achieved in March since inception. Total volume grew 39 per cent on the previous month reaching 101,215 contracts. The volume growth was driven by increased volume in currency futures, especially in euro-dollar and sterling-dollar, which grew by 37 per cent and 136 per cent respectively. The rupee-dollar, gold and WTI futures also recorded higher activity during March compared with the previous month. Euro futures volume recorded a daily high reaching 2,963 contracts, valued at $191.51 million, for the first time in its three-year history. February 4th was the busiest day for euro futures as trades accounted for 75 per cent of the exchange’s total daily volume, demonstrating the growing importance of currencies in its product range. The previous high for DGCX euro futures was 1,748 contracts, valued at $138.18 million in July 2008. “The well balanced and diversified offering of DGCX across the distinct product segments of precious metals, energy and currencies has supported year to date volume growth”, the CEO said. “Much of the volume increase has been led by the growing interest and demand for currency futures. Volatility in currencies has encouraged market participants to hedge their

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exchange-rate risk on DGCX in order to better manage their exposure.” Malcolm said. “Despite weakness in global market conditions, the month-on-month volume growth and strong first quarter performance shows that DGCX is moving in the right direction so far this year and demonstrates the appeal of our value proposition and product portfolio”, he pointed out. Diversified product offering and clearing solutions placed the exchange in an ideal position to capture the increased demand for low counter party risk instruments, he said. Malcolm says the DGCX strategy is to launch the right products at the right time and as part of this the exchange is working closely with the industry and sectors concerned. For instance, the exchange decided to postpone the launch of plastics futures as the feedback from the industry suggested that it was not the right time to launch such a product. The launch of Polypropylene and Linear Low Density Polyethylene futures contracts for the Middle East and South East Asian markets was originally scheduled for February 5, but the launch was postponed.

May 2009

Malcolm explained that although the product was ready, the plastics industry needed more time to prepare for trading the contracts, particularly in light of the current economic climate. “We work closely with the industry in order to meet their exact requirements. As far as the plastics contracts are concerned, the physical delivery nature of the contracts requires complete readiness and familiarisation, as such we will continue to work in conjunction with participants to introduce the contracts when the industry is ready,” he said. Asked about competition from Dubai Mercantile Exchange, Malcolm said competition was a good thing for the market and in accordance with the policies and practices followed by Dubai. But he refused to be drawn into answering a question on what he felt about the DME’s market performance. “My mandate is to mange DGCX and I am only concerned with that. As long as I enjoy the confidence of my board of directors, I presume I’m doing my job properly.” -K. Raveendran

EC PROPER ONOMTYY

Middle East weathering global crisis: IMF Fundamentals and policy responses helping mitigate impact of shock

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he global financial crisis has not spared the Middle East and North Africa region, but good economic fundamentals, appropriate policy responses, and sizeable currency reserves are helping to mitigate the impact of the shock, the IMF says in its latest assessment of conditions in the region. Growth in the region could slow to 2.6 per cent in 2009 from 5.7 per cent in 2008 before recovering to about 3.6 per cent in 2010. “Given the global reach of the current economic crisis, countries in the Middle East and North Africa have also been impacted negatively. However, they are likely to fare better than countries in other regions of the world—in part because of prudent financial and economic management, but also because oil exporters in the region can draw upon their large reserves,” said Masood Ahmed, Director of the IMF’s Middle East and Central Asia Department. These reserves will help “cushion the impact of the global slowdown in their own economies and the economies of their neighboring countries with which they have growing economic links,” Ahmed pointed out. Nearly all the region’s 22 countries will be affected by the global crisis in important but different ways, the report notes. Oil exporters slow down The Middle East’s oil-exporting countries—UAE, Kuwait, Oman, Qatar, Saudi Arabia, Bahrain, Algeria, Iran, Iraq, Libya, Sudan and Yemen—are feeling the impact mainly through the sharp fall in oil prices and the tightening of credit conditions. Amid high oil prices and strong investor interest the region, these countries grew by nearly 6 per cent per year between 2004 and 2008. With lower global demand for oil, however, GDP growth rates are forecast to decline to 2.3 per cent in 2009 from 5.4 per cent in 2008.

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May 2009

Countries in the Middle East and North Africa are likely to fare better than countries in other regions of the world—in part because of prudent financial and economic management, but also because oil exporters in the region can draw upon their large reserves

Despite the decline in oil revenues, however, most oil exporters in the region are maintaining government spending at a high level. This spending is providing an important stimulus to both domestic and global demand. In countries with less fiscal space—such as Iran, Sudan, and Yemen—governments will need to prioritize their expenditures, especially if oil prices remain at their current level. Lower oil prices and high spending are expected to cause a turnaround in the oil exporters’ external current account position from a surplus of $400 billion last year to a deficit of nearly $10 billion in 2009 (assuming oil prices remain at current levels).

Financial sector spillovers The global financial crisis has also led to a tightening of credit conditions in oil-exporting countries, particularly in the Gulf Cooperation Council (GCC) states and other countries whose financial systems are more integrated with global markets. With asset prices falling rapidly and liquidity conditions tightening—in part from the withdrawal of speculative capital, which started earlier in 2008—governments in the region responded by taking measures to stabilize interbank markets, ease liquidity conditions, and support commercial banks. Middle Eastern oil importers—

Afghanistan, Djibouti, Egypt, Jordan, Lebanon, Mauritania, Morocco, Pakistan, Syria, and Tunisia—have largely escaped the direct effects of the crisis, because of the positive impact of lower oil prices and their limited links to global financial markets. But as the worldwide recession has deepened, these countries face weaker prospects for exports, foreign direct investment, tourism, and remittances. As a result, real GDP growth for these countries is projected to drop to 3.2  per cent in 2009 from 6.2 per cent in 2008. This group has mainly been affected by slowdown in their trading partners—Europe, the United States, and GCC countries—which has led to

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May 2009 35

a fall in exports and foreign direct investment, according to the report. Tourism and remittances are also likely to be affected, although the data so far show them to be quite resilient. Oil-importing countries that trade mainly with the GCC could be protected to some degree by oil exporters’ continued spending. But a protracted recession in trading partners could have a significant impact on the growth of oil importers, and unemployment and poverty could rise, Ahmed said. The projected fall in inflation to 9.7 per cent in 2009 from 14.4 per cent in 2008 for this group of countries should alleviate some of the pressure on the poor. Countries in this group represent a range of different economic structures and levels of development, and depend upon different types of foreign inflows. Some countries are better integrated with world financial markets (for example, Egypt, Jordan, Lebanon, and Pakistan), but others, such as Afghanistan, are more dependent on official development assistance.

Policy challenges Given the region’s unique characteristics, economic policy should concentrate on the following key measures, the report stresses: • Maintain or increase public spending where possible. Countries where public debt levels are not a concern would do well to maintain or enhance public spending. This is true for most oil exporters, but also for countries like Morocco, Syria, and Tunisia. • Strengthen financial systems. Countries should keep a close eye on their banking systems and, where appropriate, conduct “stress tests” to assess recapitalization needs and deal with troubled financial institutions. • Ease monetary policy as inflationary falls. As inflationary pressures recede, some countries will have more room for an easing of monetary policy to support investment and growth. • Strengthen social safety nets. In this period of economic slowdown, it will be crucial to target government resources and develop policies to protect the poor and vulnerable segments of society.

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Sovereign Wealth Funds: Impact and implications

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he role of Sovereign Wealth Funds (SWFs) in supporting domestic macroeconomic and financial stability has increased with the global crisis. As a result, implications for their investment strategies, overall transparency, and consistency with domestic macroeconomic frameworks are receiving attention, IMF said. Deteriorating domestic financial conditions have warranted more prominent roles for SWFs in their home countries. For example, the Kuwait Investment Authority (KIA) and the Abu Dhabi Investment Authority have repatriated part of their foreign assets and deposited them in domestic banks to provide liquidity. SWFs’ resources in Kuwait and Oman were used to set up funds investing in local equity markets. In addition, the Qatar Investment Authority and the KIA bought domestic bank shares to help boost bank capitalization and confidence. At the same time, SWFs in the region continue to pursue profitable investment opportunities abroad in real estate, retail, and finance. The crisis has shown that, notwithstanding their long-term focus, SWFs have a domestic stabilization role with implications for their investment objectives and strategies. In times of financial stress in the domestic economy, SWFs’ domestic investments may temporarily deviate from pure profit maximization to support broader macroeconomic and financial stabilization objectives. Going forward, SWFs need to ensure that they hold sufficient liquid assets to take on their stabilization role without realizing losses. The scope for SWFs’ stabilizing role in international capital markets will remain substantial. The sharp downturn in asset prices since early 2008 has likely resulted in losses for MEOE SWFs. This is not surprising given the marked declines in major indices (the S&P 500 and World Equity Index lost, respectively, 39 per cent and 42 per cent in 2008). Despite their losses and greater domestic focus, SWFs’ relative size and influence in the global market will remain large. They are also likely to continue to maintain a longer-term investment strategy than most other investors. International financial markets are likely to face increased regulation and demand greater transparency and accountability, which may affect SWFs’ cross-border operations. Increased regulation may alter the relative attractiveness of some asset classes or industries that SWFs invest in. More directly, SWFs could be affected by requirements that all financial institutions and investment vehicles improve transparency and disclose more financial information. Furthermore, as SWFs have become more active in their domestic economies, it is important that their domestic operations also support, and be consistent with, the country’s macroeconomic framework. Well-designed policies and procedures for adding to or withdrawing from SWFs’ resources would ensure consistency with their policy objectives Spending of SWF resources should be transparent and not undermine budgetary control. Moving SWF assets from abroad should take account of balance of payments and liquidity implications and be closely coordinated with monetary and exchange rate policies to prevent undermining the macroeconomic management of the domestic economy.

May 2009

PROPER T Y INTERNATIONAL

Toxic waste removal Markets applaud plans to rid bank balance sheets of bad assets By Jeff Applegate and Charles Reinhard

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t last, the equity markets have found something to cheer about. Stocks rallied mightily around the world after US Treasury Secretary Timothy Geithner unveiled the Obama administration’s two-part plan to rid bank balance sheets of toxic assets. After Geithner’s March 23 announcement,

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equities built on prior momentum from the Federal Reserve Board’s blockbuster March 18 decision to cross a big divide in buying $300 billion in longer-term Treasurys as part of a stepped-up effort to bring down interest rates on mortgage loans and other risky assets. The Fed typically buys only short-term Treasury bills.

May 2009

The rallies couldn’t come soon enough. Geithner’s failure to come up with sufficient details at his Feb. 10 appearance on Capitol Hill put equity investors in a foul mood. The Standard & Poor’s 500 Index sunk to a 12-year low on March 9, but rallied 23 per cent through March 26—the fastest 20 per cent-or greater rally off a low since

1938. Global equities rose 19 per cent in local currencies and 23 per cent in US dollars. Since then, US and global equities gave ground on concerns about the future of General Motors and Chrysler. Whether the March rally proves to be a bear market bounce or the start of real recovery depends largely on global policy responses and their execution, in our view. Increasingly, we believe policymakers are catching up with, and possibly getting ahead of, the curve. Two-pronged plan: The administration’s Public-Private Investment Program (PPIP) aims to remove up to $1 trillion of assets, with one program designed for legacy loans and another for legacy securities. In all, the program will deploy up to $100 billion of the Treasury’s bank rescue funds that will be invested side by side with private investors. The legacy loans program will establish ‘price discovery’ via an auction process on assets that banks wish to sell. Meanwhile, the procedure for the legacy securities program calls for asset managers to make bids on eligible assets, after their plan to do so has been approved by the Treasury. Those bids will then be accepted or rejected by banks and other financial firms. Attractive terms: Government-provided leverage and risk capital are key elements in the PPIP. The legacy loans program will make heavy use of guaranteed financing by the Federal Deposit Insurance Corporation (FDIC). Up to five-sixths, or 83 per cent, of the loans could be financed by the FDIC, with the Treasury and private investors providing the rest in equal amounts. On the other hand, the legacy securities program will rely on asset managers to raise private money. The Treasury will match the private capital raised, doubling it, and also provide up to 200 per cent financing on the initial capital—doubling it yet again. The

starting date for the program is yet to be announced. Unprecedented ease: The Federal Reserve is expanding its efforts to get the credit market moving again. An aggressive program of Quantitative Ease (QE) that was announced after the Fed’s March meeting will, along with other initiatives, push the Fed’s balance sheet toward $4 trillion, or 30 per cent of GDP. The Fed plans to buy $300 billion in notes from the $3 trillion outstanding in two-to- 10-year securities. In doing so, the Fed hopes to lower interest rates on government debt, making it cheaper for the US Treasury to borrow the money it will need to support the fiscal stimulus program and its ambitious plans to repair the financial system. Central bankers have historically avoided using their powers to print money, which is essentially what is happening here, to support political goals. They do so to guard their independence, so that when necessary, they will be free to fight inflation by raising

interest rates. But now, deflation is the big risk; and as far back as a speech he gave in May 2003, Fed Chairman Ben Bernanke has stated that combating deflation requires monetary and fiscal cooperation. Buying binge: Also on March 18, the Fed said it will buy an additional $750 billion of agency mortgage-backed securities, taking the total to $1.25

Increasingly, the policymakers seem to be catching up with, and possibly getting ahead of, the curve

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May 2009 39

Is the promise of portfolio diversification dead?

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he severe downturn in financial markets since 2007 has led many investors to question the benefits of portfolio diversification. Some are reevaluating their strategies, reassessing their risk tolerance and rethinking their financial plans. Is the promise of portfolio diversification dead? We think not. Benefits of diversification: Asset allocation theory states that by building a portfolio of different asset classes, investors can achieve greater portfolio efficiency, or a higher return per unit of risk. Now consider portfolios

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split 50/50 between the S&P 500 and intermediate government bonds or the S&P 500 and long-term corporate bonds. The calculation starts with the portfolio return, subtracts the riskfree rate and divides the remainder by the standard deviation of returns, a proxy for volatility. With this metric, the higher is the ratio the more efficient the portfolio. For the period from 1926 to the present, a portfolio of US stocks alone had a Sharpe ratio of 0.29. The ratio was 0.39 for the portfolio blending stocks and corporate bonds and 0.41 for the portfolio with government bonds. So, while an

May 2009

all-equity portfolio had a higher nominal return, the portfolios that were half bonds provided a higher return, given the amount of risk. Attributing benefits: Importantly, the blended portfolios’ improved efficiency relative to an equity-only portfolio was not due to bonds themselves being more efficient than stocks. Rather, the blended portfolios were more efficient because stock and bond returns do not always move in tandem. In other words, more often than not they complement each other. In addition, if you look at the returns across rolling 10year periods, the mixed portfolios de-

livered positive returns 100 per cent of the time versus 96 per cent for the allstock example. Moreover, the blended portfolios beat inflation 87 per cent of the time, a big improvement compared with bonds alone. More efficiency: A study of the 10 most severe equity bear markets since 1926 shows the value of portfolio diversification. During these downturns, the S&P 500 Index posted an average -35 per cent return. The blends fared better, with average returns of -19 per cent for portfolios using long-term corporate bonds and -17 per cent for those using intermediate-term government bonds. By the time the 100 per cent equity portfolios recovered lost ground and returned to their prior cycle peaks, the blended portfolios stood, on average, 21 per cent and 17 per cent above their pre-correction highs for portfolios using corporate bonds and government bonds, respectively. In each instance, the blends performed better than portfolios using equities alone during the entirety of the equity bear market and recovery periods. Perfect correlation: During shorter term periods of market distress, it is not unusual for the correlations among asset classes to move toward 1.0, perfect positive correlation. In these periods, investors are often forced to sell what they can, not what they prefer. The latest episode has been no exception. Even so, diversified portfolios helped to contain the damage. From Oct. 7, 2007, the last high on the S&P 500, until Feb. 27, 2007, the S&P 500 fell 51.4 per cent. A portfolio of half S&P 500 and half Barclays Capital US Aggregate Index, which includes government and corporate bonds, lost 22.2 per cent. A portfolio of 50 per cent S&P 500, 40 per cent Barclays US Aggregate and 10 per cent cash was down 16.7 per cent. Although simplified, these results indicate that broad portfolio diversification matters. The fact that even the portfolios with bonds and cash registered negative results underscores how difficult the market environment has been. Essentially, only plain-vanilla government securities earned positive returns during this period. But such

episodes of severely strained liquidity, while not unprecedented, are highly unusual and should not be considered the new norm. Inflation hedge: While US equity returns can fluctuate wildly in the short run, over longer periods, they tend to be positive both before and after inflation. Since 1926, S&P 500 returns have topped inflation in 68 per cent of the one-year periods, 77 per cent of the five-year periods, 87 per cent of the 10-year periods and 100 per cent of the 20-year periods. Earnings and the economy both tend to grow faster than inflation, which provides an inflation hedge for long-term investors. Nonetheless, recent events may

of the time for stocks but only 73 per cent of the time for intermediate-term government bonds and 59 per cent for long-term corporate bonds. These data explain the importance equities play for long-term investors who seek to beat inflation and, therefore, achieve greater purchasing power in the future for themselves, their heirs or their philanthropic interests. Mismanaged expectations: To be sure, some investors and media pundits have interpreted recent investment results as a failure of portfolio diversification to deliver on its promise. As we see it, the failure has been in managing investors’ expectations and overpromising on what portfolio diversification

have made some investors realize that their tolerance for owning equities is not as high as they thought. In that case, it is time for them to reassess their risk profiles and strategic asset allocations. Still, with the bear market well advanced, this is perhaps not the most opportune time to move away from stocks. Besides missing a potential recovery in stocks, an investor risks overloading the portfolio with low-return assets. There is another problem with moving too heavily toward bonds: They are less likely than stocks to beat inflation. Across rolling 20-year periods since 1926, the real or inflation-adjusted return has been positive 100 per cent

can do. Its benefits are well-grounded, but investors should not expect to be immunized from the effects of a severe bear market. When most asset classes are declining, a portfolio will not increase in value because it is well-diversified; only well-timed tactical asset allocation adjustments and other temporary hedging strategies can do that. Fortunately, today’s harsh conditions are the exception rather than the norm. Portfolio diversification remains the best way to balance risk and return over long investment horizons. Excerpted from a Strategic Thinking paper titled ‘Is the Promise of Portfolio Diversification Dead?’ Credit: The Views

BANKING AND BUSINESS REVIEW

May 2009 41

trillion, an amount larger than the entire issuance in 2008. Finally, the Fed will be purchasing an additional $100 billion of agency debt on top of the $100 billion already planned. This comes on top of the $1 trillion Term Asset-Backed Securities Loan Facility (TALF), which was expanded on March 23 to include issues originated before Jan. 1. Other central bankers are also embracing QE: The Bank of England and the Swiss National Bank are buying both sovereign and corporate debt with—so far—salutary market results. The Bank of Japan announced it has increased the size of its QE program by 30 per cent, to 1.8 trillion yen per month. Monetary policy is simply no longer measured by interest rates alone. Still, the European Central Bank recently lowered rates, as did central bankers in the UK, Switzerland, Brazil and New Zealand. A lasting rebound: In our view, the extraordinary monetary stimulus, along with the fiscal stimulus, will lead to economic recovery. Thus, as long as policy remains engaged, the recent bear market bounce could be the start of a more lasting equity rebound. Ac-

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cordingly, given the sell-off in global equities earlier this year, we’re recommending investors rebalance their portfolios, if necessary, to bring their equity holdings back to their strategic asset allocation. We are optimistic on equities for more than policy reasons: Our analysis shows that valuations are at extremely attractive levels. Consider a metric known as Tobin’s Q Ratio, so called because it was developed by economist James Tobin, who was awarded the Nobel Prize in Economics in 1981. The Q Ratio compares the market value of the US stock market to the replacement cost of the companies’ assets. At the end of the fourth quarter, the latest available data, US stocks could be purchased for just 62.1 per cent of the replacement cost of their assets, a clear sign of value. That ratio could be even lower now because the S&P 500, despite the recent rally, is down 12.8 per cent for the year (through March 30). Atypical valuations: Some of the more common valuation yardsticks are also signaling that equities are attractive. For example, price/earnings

May 2009

ratios are well below their historical averages—which is more typical for periods of high inflation rather than the low, or even negative, inflation that is in effect now. What’s more, P/E ratios are low at a time when profits are also low. Typically, the ratios are higher at the low point in the profit cycle because, anticipating an upturn, investors bid up the prices before the earnings kick in. The low P/E can also be read as a measure of bearish sentiment. Bearish sentiment reached an extreme in early March. Investor and consumer surveys all pointed to heightened levels of fear and foreboding: The Market Vane survey dropped to just 32 per cent bulls, Investor’s Intelligence fell to 26 per cent and the American Association of Individual Investors plummeted to 19 per cent bulls. Such gloom can be bullish. At that point, any hint that the outlook is not quite as bad as already feared can give investors a lift and lead the market higher. Jeff Applegate is Chief Investment Officer and Charles Reinhard Senior Investment Strategist with Citi Global Wealth Management.

PROPER RE AL ESTATE TY

Uncertainty is biggest risk Effect of credit crunch felt more severely than any other industry

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arket uncertainty coupled with the credit crunch continues to pose significant risk for the real estate industry this year, according to the 2009 Ernst & Young Real Estate business risk report. The annual top ten ranking by leading sector analysts reveals the top risks facing the sector against the backdrop of the economic crisis. The report was published in conjunction with Oxford Analytica. According to the survey respondents, the 2009 top 10 risks rankings for the real estate sector are:

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• Continued uncertainty and impact

of the credit crunch • Global economic and market fluctuations • Impact of aging or inadequate infrastructure • Global war for talent • Changing demographics • Inability to find and exploit global and nontraditional opportunities • Pricing uncertainty • Green revolution, sustainability and climate change • Economic vulnerability and regulatory risks in developing markets • Volatile energy costs

May 2009

Globalization takes a new meaning The US credit crisis has continued to ripple across economies and real estate markets around the world, its impact being the top risk facing the sector worldwide. The global real estate industry went through tumultuous phases for most of last year, with little signs of bouncing back in the short term. The effects, felt the strongest in the west, spread to the region’s once buoyant property sector, which is now realizing the tightening conditions in the market perhaps more than any industry due to

With institutions and individuals adopting a very cautious stance, liquidity remains the key concern that causes many projects to be put on hold – some even risk cancellation its heavy reliance on capital. It suffered serious setbacks when local investor sentiments reeled under the impact of the credit crunch. Mohammed Dahmash, Ernst & Young’s Real Estate Transaction and Advisory Services Group in the Middle East, says, “The effect that the credit crunch has had on investor sentiments and market confidence makes it even more acute. The hugely leveraged property sector credited its growth to liberal lending practices and a bullish investing public. With institutions and individuals adopting a very cautious stance, liquidity remains the key concern that causes many projects be put on hold – some even risk cancellation.’’

Economic vulnerability and changing demographics For the regional sector, the next major risk stems from economic vulnerability and regulatory risks. Dahmash adds, “Economic and regulatory risks are not always easy to identify and define in emerging economies – especially during a downturn. Some crucially strategic challenges include managing specific local regulations like property rights, tax laws (where applicable), arbitration,

and residency clauses. Equally important is the enforcement of laws concerning bankruptcy and foreclosures. Any serious player needs to be willing to make long term commitments in emerging markets like the Middle East and must be prepared for a learning curve to better comprehend the opportunities and related risks.’’ He points out that with shifting demographics being seen as a major area of concern for the region, there is also an underlying need to link strategic business growth plans to market demographics. Demographic analysis and forecasting is often seen as a natural part of the real estate industry because shifting demographics will determine what will be built, where it will be built and how it will be funded. Dahmash adds: “A ballooning middle class, for instance, will lead to demands for basic services, including education; create demand for a leisure and tourism infrastructure; and strain the ability of countries to make more development-oriented investments. Unless regional players factor in the rise of a growing middle class with an appetite for affordable housing, the sector may experience an unbalanced overabundance of luxury properties.

Such a scenario can potentially prolong the industry’s recovery process – a hugely avoidable proposition.”

Below the radar In addition to revealing the top 10 risks, the report identifies the following risks that sit ‘below the radar’ and which may move up the risk ranking in the years to come: • Geopolitical shocks • Financial reputation • Inability to insure certain properties • Regulatory and compliance risks Despite various risks that currently confront the industry, the real estate sector is poised to tide over the crisis. The first round of market corrections have happened. This has led to some fundamental and structural changes in the operating business models. Government support in terms of increased infrastructure spending and bail out guarantees to financial institution will help in restoring confidence and bring back the industry to its feet. Dahmash concludes that this is the best time to reassess and put one’s house in order so that businesses are best equipped to capitalize on the opportunities that will emerge from adversity.

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May 2009 45

PROPER T Y TECHNOLOGY

Prepaid cards The new wave of innovative banking?

T

he banking sector is set to undergo significant changes in 2009, with new and existing regulations driving the need for banks to adapt the way they do business. As well as placing pressure on banks to change their operating structures, regulations will have a significant impact on the competitive landscape. As a result, banks will have to reassess their relationships with customers and put in place measures to renew trust and deliver greater value to the consumer. One regulatory example is the Payment Services Directive (PSD), which aims to provide a harmonised legal framework for all payments made in the European Union (EU). As such, it is a crucial milestone in paving the way for the implementation of the single euro payments area (SEPA), which aims to achieve integrated payment infrastructures and products for all euro credit transfers, direct debits and debit card transactions. As the PSD looks to encourage more players into the payment sector, competition for the retail customer is on the increase. This in turn will drive the need for retail banks to adopt innovative solutions to stay ahead of the competition and position themselves for market recovery. The PSD is due to become part of national law in November 2009 and banks are already busily preparing their own systems ahead of this deadline. However, the directive significantly changes the landscape, with the creation of licensed payment institutions across the EU. This means the market is opening up new routes for institutions to become entities licensed to handle customer funds and also to be members of schemes such as VISA and MasterCard. In confirmation of this, the European Commission (EC) aims to treble the number of electronic money institutions, just one of the categories of competitors to the incumbent banks, over the next two years.

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Innovation for profit

Innovation will be a major factor for banks in addressing the challenge of changing regulation and intensified competition. However, for innovation to be successful, it must be applied within the right context and deliver results. The approach therefore needs to consider those business models that have already achieved a degree of success and are ripe for further development. Virtual prepaid cards is one such innovation and is fast becoming the ‘one to watch’ in the payment space. The prepaid industry, when compared with other elements of banks’ card businesses, is relatively young. As with any line of business, it is important that prepaid schemes are both successful and profitable for them to become an attractive proposition. As the market continues to mature, as well as in these turbulent times, prepaid offers banks a number of opportunities to achieve growth, increase customer acquisition and sustain a competitive advantage. Prepaid offers banks a highly secure alternative to credit cards by, in particular, allowing them to remove some of the associated risk. In the UK, Equifax estimates that some two-thirds of credit card applications are declined. Many of these could be fulfilled through other profitable routes such as prepaid accounts. A further advantage is in making cross-border payments. While the SEPA initiative is opening up the payment market across Europe, there is a real opportunity for banks to make quick, safe and prompt cross-border payments on a global scale. With SWIFT catering to higher value payments, typically over £1,000, prepaid will enable banks to maximise the potential of smaller payments and therefore act as a complement to their existing business models. Virtual prepaid enables businesses and consumers anywhere to pay quickly and avoid many of the costs traditionally associated with e-commerce. Business users can cost-effectively send payments to consumers around the world, while consumers can benefit from protection against ID theft and fraud when they make purchases online. Consumers also inherently benefit from the re-

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duced credit and other risks associated with prepaid, which is particularly relevant in today’s tough economic climate.

3SC Technologies claims over 80 man-years of IT expertise

D

ubai-Based 3SC Technologies says it has over 80 man-years of IT expertise in the banking industry, with sales and support offices in Kuwait, Bahrain and Qatar and back offices in Pakistan and Malaysia. A GBS Group company, 3SC Technologies provides integrated suite of software, solutions, services and consulting in EFT and the payments industry. According to the company, the payments solutions include the industry’s top recognized software and services for payment processing from a wide range of applications, including card management system, charge back system, card issue, payment middleware, fraud management, antimoney laundering etc. The card management software provides a feature-rich platform for processing and managing prepaid cards, fleet cards, credit cards, debit cards, reward cards, private-label card etc. According to the company, it is the next-generation software solution for merchant acquiring, card issuance and account management, disputes management, and collections management. The charge back package offers one single interface for both Issuer and Acquirer activity, covering all types of exception processing problems which, according to the company, cuts down the operational costs and ensures real financial control. The company also offers fully integrated instant issuance and PIN selection solutions that allow financial institutions and retailers to quickly and securely issue ATM, prepaid, debit and credit cards instantly at branch or store locations. 3SC Technologies’ EFT Switch payment authorization and routing system for issuers and acquirers addresses the needs of banks, retailers and processors. An SOA-oriented platform independent product, it is specifically targeted at the card payments market and is designed with future needs in mind, with an emphasis on user configuration rather than programming, say company sources. It also offers flexible, labour-saving payments message transformation product; enabling message transformations to be effected by point and click windows-based configuration, without coding. The company claims that its fraud management and detection system facilitates an entirely new approach to detecting card-based fraud, improving on the traditional and increasingly dated neural network approaches. Similarly, the anti-money laundering system helps detection and reporting of illegitimate activities by dynamic rule based scenarios. The solution has an enterprise wide approach in tracking and monitoring transactions focusing at hindering the persevering money laundering activities, efficiently and effectively. 3SC Technologies also provides performance monitoring and diagnostics software solutions for business-critical computing environments including ATM and PoS networks.

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Industry standard Banks are in a prime position to take the lead on innovation in the virtual prepaid area, realising the benefits and bringing it into the mainstream. However, with their reputations at stake, they must first address the risks and help build an industry standard that will ensure integrity throughout the prepaid sector. There are three broad areas to address. The first area is proactive management of fraud. Successful and safe e-commerce is paramount to the success of virtual prepaid if it is to appeal to the end user. The current unstable economic climate, coupled with the proliferation of stories about data losses, has led to growing consumer concern about the safety of their personal data and money. Virtual prepaid introduces safety into this process through the protection of customer data and balances. Customers can limit the amounts on their prepaid account and create new payment instruments, such as virtual Visa cards, for each purchase. The second area is to ensure the safety of customer funds. Following high profile collapses of financial institutions, customers need reassurance that their cash is in safe hands. For prepaid, particularly for the small business community, this means providing an equivalent of the government deposit guarantee to provide peace of mind to the customers in terms of securing the funds loaded into their prepaid account. In practical terms, this would mean separating and legally protecting virtual prepaid funds appropriately. Finally, banks must provide clarity of terms to their customers. While the PSD seeks to create transparency of fees across the EU, banks must take the global view. The right approach here is for banks to spearhead a full disclosure policy in terms of their prepaid fees. This will be vital if the industry is to maintain customer trust in what is perceived to be a new banking innovation. William Lorenz is chief operating officer of EntroPay, provider of virtual prepaid cards in Europe. Credit:gtnews.com

ABN AMRO Bank Head Office: The Netherlands Dubai Branch, Regional Hub for UAE and Middle East P.O.Box: 2567, Khalid bin Waleed Street, Dubai, UAE. Non-stop banking service: Dubai Branch: Colin Macdonald Burhan Khan Hassan EI Nahas Vishnu Deuskar Padmanabh Mishra

Tel: 04 3512200 Fax: 04 3511555 04 3080000 (Toll free)

Country Executive Head of Consumer Banking Head of Private Clients Head of Global Market Head Commercial Client Coverage

04 5062601 04 5062801 04 5062301 04 5062551 04 5062701

Abu Dhabi Corner of Hamdan and Salam Streets P.O. Box: 2720, Abu Dhabi, United Arab Emirates

Tel: 02 6963000 Fax: 02 6963001

Sharjah Abdul Aziz Al Majid Building, King Faisal Street P.O. Box: 1971, Sharjah, United Arab Emirates

Tel: 06 5594900 Fax: 06 5591009

Abu Dhabi Commercial Bank Head Office: Abu Dhabi Mall P.O. Box 939, Abu Dhabi Branches Al Salam Omar S. Al Tamimi Khalidiya Al Bayah Khaled Al Mannaei Al Dhafra Yaqoob Al Dosari Al Muroor Ramzi Al Rimawi Al Shahama Hazim Al Suwadi GHQ Essam Husain Al Habshi Tourist Club Area Hadia Dalloul Hamdan Abdalla Al Jaberi Sh. Rashed Road Mohamed Al Dosari

Tel: 02 6962144

Manager Manager

Fax: 02 6450384

02 6962486, 02 6666311 02 6669910 02 8721300

(Edgar Ruaya / GM in charge) 02 5851030 Manager

02 4444216

Manager

02 5633424

Manager

02 4415626

Manager

02 6725178

Manager

02 6335820

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02 6213237

Corniche Ghassan Kandalaft Mussafah Firas Al Eid Baniyas Town Hamad Salem Rashid Al Junaibi Ruwais Mohammad Ismail Zayed Town Dhababa Rashed Obaid Al Mansouri Gayathi Haraba Al Mazroui Al Baya Ottakath C Mohamed Kutty Al Ghuaifat Pay Office Ottakath C Mohamed Kutty Al Ain Main Branch Mohd. Al Darmaki Al Ain Khalifa Street Salim Al Darmaki Sinaeyah (Indust. Area) Salem Ahmed Al Wagan Nayla Al Ameri Al Yahar Khamis Sulum Abdun Khamis Al Hayer Khalid Omar Eissa Riggah Mudhi Al Haj Karama Omran Abbas Taimour Mina Hosam Al Refay Naif Ms. Seema Mohd. Malk Al Ettihad Salem Ali Khammas Jammahi Al Qusais Fahd. M. Baroudi Manager Sharjah Main Ms. Wissam Moaded Farah Al Ulama Abdulla Al Shamsi Abdullah Fayez Al Shamsi Ajman

Manager

02 6275111

Manager Manager Manager

02 5544272

Manager

02 8775015

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02 8846180

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02 8721300

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02 8723499

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03 7543413

02 5821550

03 7511322 Manager

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03 7352100

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03 7815600

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03 7322557

Manager

04 2956969

Manager

04 4055135

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04 3984444

Manager

04 6024110

Manager

04 3615151 ext. (202)

Manager

04 2634244

Manager Manager Manager Manager

06 5737737 06 5566169 06 5433300 06 5432006

BANKING AND BUSINESS REVIEW

May 2009 49

Yasmeen Alabid       Manager RAK Aisha Ahmed Ghareib      Manager Fujairah MohdAli Hassan Mohd Al Bloushi Manager  Dibba Rania Yousef Manager Contact Centre Ahmed Abdo Manager Eissa Al Suwaidi Eirvin Knox Ala’a Eraiqat Thirry Bardury Deepak Khullar Seumas Gallacher Zaki Hamadani Sultan Al Mahmoud Abdirizak Ali Alok Kakar Robert Price Walter Pompliano Howard Gaunt Jasim Al Darmaki Arup Mukhopadhyay Ahmed Barakat Yaser Mansour Simon Copleston

06 7442111 07 2335500 09 2224324 09-2446700 800-2030

Chairman CEO Deputy Chief Executive Officer Head Operations & IT Chief Financial Officer Head - Investment Banking Head - legal & Special Assets Head - Human Resources Head - Internal Audit Head - Corporate Finance Division Head - Credit Head - Financial Institution & Intl. Division Head - Business Banking Head - Government Relations Head - Retail Banking Head - Wealth Management Head - Corporate Communications, Director of Chairman’s Executive Office & Senior Vice President General Counsel & Board Secretary

Tel 02 6343000 Fax 02 6342222

Established on 20th May 1997 as a Public Joint Stock Company through the Amiri Decree No. 9 of 1997. The bank commenced commercial operations on 11th November 1998, and was formally inaugurated by His Highness Sheikh Abdulla Bin Zayed Ak Nahyan, UAE Minister of Information and Culture on 18th April 1999. All contracts, operations and transactions are carried out in accordance with Islamic Shari’a principles. Branches Abu Dhabi Main 02 6168118 Aref Ismail Al Khouri Manager Mushref 02 4455177 Ezzeldin Nagdy Manager Madinat Zayed 02 6100821 Mohamed Yousef Manager Khalidiya Ladies Abu Baker Omar Manager Sheikha Al Suwaidi Manager Khalifa Street 02 6100590 Omar Aqel Manager Al Ain Sinaiya 03 7211777 Omar M. Basheer Manager Clock Tower Branch 03 7076444 Ali Abdullah Al Manager Dhaheri Al Jimi Mall Branch 03 7633500 Ahmed Abdullah Manager Al Boloshi

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04 2611116 04 3973333 04 4033400

Fujairah Fujairah 09 2222711 Fahad Al Shaer Manager Dibba 02 6100920 Ali Mohammed Manager Ras Al Khaimah 07 2284448 Saif Hamdan Alkeem Manager Sharjah 06 5075100 Ali Essa Alshaqoosh Manager

Al Ahli Bank of Kuwait - Dubai Head Office: Kuwait Regional Head Office: Dubai Tel 04 2681118 Opposite Hamarain Centre, Deira Fax 04 2684445 P.O.Box 1719, Dubai, E-mail: [email protected] Website: www.ahlibank.ae Management & Senior Personnel: Vikram Pradhan General Manager, UAE Vijay Shah Head of Trade Finance & Operations Hiranand Motwani Manager Treasury Krishna Kumar Manager Retail Operations

American Express Bank Ltd

Abu Dhabi Islamic Bank Head Office: Abu Dhabi Najda Street, P.O. Box 313, Abu Dhabi UAE Email: [email protected] Website : www.e-adib.com

Dubai Al Twar Ibrahim Alqasser Manager Opposite Deira City Center Hashim Al Zarooni Manager Shk. Zayed Rd. Mohamed Hussein Zainal Manager

Representative Office, Suite 509 Tel: 04 3975000; Fax: 04 3976986 The Business Centre, Khalid Bin Al Waleed Street, Bur Dubai P.O. Box 3304, Dubai. Prabir A. Biswas Director & Chief Representative Sumit.K.Roy Director-financial institution group John A. Smetanka Head-wealth management-subcontinent and global NRI

Arab African International Bank Head Office: Cairo, Egypt. Regional Head Office Dubai Tel: 04 3937773 ART Tower, Al Mina Street, Opp. Ports & Customs Bldg., Bur Dubai P.O. Box 1049, Dubai Fax: 04 3937774 Swift ARAIAEAD, E-mail: [email protected] Web: www.aaib.com History: Established 1964 as the first Arab joint venture bank Hemant Jethwani General Manager UAE Dubai Branch: Key Executive Alaa Sobhy Head of syndication and assert trade Abu Dhabi Tel: 02 6323400; Fax: 02-6216009 Arab Monetary Fund Bldg, Corniche Street, P.O. Box 928, Abu Dhabi Key Executive Hani Hassan Branch Manager

Arab Bank Head Office Jordan – Amman Tel: 04 2950845; Fax: 04 2024369 P.O.Box 950544, 950545 Amman 11195 Website: www.arabbank.ae History: The Arab Bank Group is one of the principal financial institutions in the Arab world and ranks among the leading international banks in terms of equity, earnings and assets. Established in 1930 in Jerusalem. The Arab Bank Group is

owned by about 4,000 shareholders from all over the world, mainly Arab countires. The Group has a diversified network of over 350 branches worldwide. Abdul Majeed Shoman Chairman Abdel Hamid Shoman Deputy Chairman & Chief Executive Officer U.A.E Area Management Mohammad A . Azab Senior Vice President - Dubai Saed Jarallah Senior Vice President – Abu Dhabi Aladin Al-Khatib Treasury Head Hatem Kurdieh Corporate Banking Head Tareq HajHasan Retail Banking Head Mohammad Mattar Central Operations Unit Manager Hani Hirzallah Regional Manager Human Resources /Gulf Region Tareq Ibrahim Head of Human Resources Ammar Al Khayyat Financial Controllar Ghassan Nimer IT Center Regional Manager Jihad Ghoury Legal Counsel Sanjay Malhotra Global Head of Marketing & Product Develeopment Nasser Maghtheh Senior Auditor Anan Al Khatib Premises & Pruchasing Officer (Engineer) Suleiman Malhas U.A.E Branches Audit Centre Manager Dubai Al Ittihad Street Mohammed Azab

04 2950845

Branch Manager

Mir Asif Ali Mgr - Treasury Dept Saidi Zoubir Head of Business Dev. Dept. Tareq S’adi Al Darras Mgr - Credit Risk Management Issam Abugisseisa Legal Advisor Abu Dhabi Main, Sh. Hamdan Street Noora Ebrahim Manager -Sales & Services Souk Branch Al Masaood Building - Khalifa Street, Abu Dhabi Nasser Rashed Al Ali Manager

Dubai Arbift Tower, Baniyas Street, Deira Adel Mohd. Khalfan Manager Al Bagh

04 2220151

Sharjah King Faisal Street Fatima Al Muani Manager

06 5744888 06 5747766

04 2221231

Arab Banking Corporation

Abu Dhabi Al Naser Street Nasser Serries Branch Manager

02 6392225

Abu Dhabi Office Office, 10th Floor, Abu Dhabi Trade Centre, Abu Dhabi Mall P.O.Box 6689, Abu Dhabi Mohamed El Calamawy Chief Representative

Al Ain Colock Tower roundabout, Al Ain Street Maen Jarrar Branch Manager Sharjah Al Arooba Street Maher Al Debis Branch Manager

03 7641328

Ajman Rashid Bin Humaid Street Modhar Kherfan Branch Manager

06 7422431

Ras Al Khaimah Oman Street, Al Nakheel Ali Zatar Branch Manager

07 2288437

Fujairah Sheik Zayed Street Abdel Hamid Qamhieyah Branch Manager Call Centre Within UAE Outside UAE

09 2222050 800 40 43 009714 2953889

Arab Bank for Investment and Foreign Trade Abu Dhabi Tel 02 6721900 Regional Head Office, Sh. Hamdan Street, Tourist Club Area Fax 02 6785271 P.O. Box 46733, Abu Dhabi Telex 22455 ARBIFT EM Email: [email protected] Website: www.arbift.com History: Established in 1976 in Abu Dhabi Registered as a Puvlic Joint Stock Company Management & Personnel Ibrahim N. R. Lootah General Manager 02 6952286 Hassan S. Kishko Head of Finance 02 6721299 M.A. Majid Siddiqui Head of HR & Admin 02 6728785 Khalid Mohammed Bin Amir Head of Operations 02 6776109 Najib Taleb Nasser Head of Commercial Banking Ahmed Majid Lootah Head of Retail Banking 02 6743801 M. Santosh Babu Senior Manager IT 02 6722975 Izzeldin Al Siddiq Salem Mgr - Inspection & Internal Audit 02 6780592 Osman Hamid Suliman Mgr - Banking Relations Dept 02 6787380

02 6275087

Al Ain 03 7655133 Mohd. Sultan Al-Darmaki Bldg., 1st Floor, Old Passport Office Road. Hussain Marzouqul Manager 03 7656482

Deira Mohammed Elayyan Branch Manager

06 5618999

02 6721600 02 6723763 02 6720886 02-6791642 02 6721900 02 6780423 02 6269500

04 2282071

02 6447666 Fax 02 6444429

Arab Emirates Investment Bank PJSC Head Office: Cairo Egypt Regional Office: Dubai ART Tower, Al Mina Road, Opposite Maritime City, Bur Dubai P.O Box 1049 Dubai SWIFT: ARAIAEAD E-mail: [email protected] Web: www.aaib.com

Tel: 04 3937773 Fax: 04 3937774

Management-UAE Hemant Jethwani General Manager Alaa Sobhy Head of Syndication and Asset Trade Mahendran Raman Head of Operations and Liabilities Abu Dhabi Branch Tel: 02 6323400 Fax: 02 6216009 Arab Monetary Fund Bldg., Corniche P.O Box 928, Abu Dhabi

BLOM Bank France SA Dubai Tel 04 2284655 Al Maktoum Street, Deira Dubai, P.O. Box 4370 Fax 04 2236260 email: [email protected] www: www.blombank.ae Bassem Ariss Regional Manager 04 2222355 Samir Hobeika Branch Manager 04 2214648 Michel Germanof Manager Corporate Credit UAE 04 2242067 Mohammad M Ansari Treasurer 04 2224812 Sharjah PO Box 5803, Al Buheira Tower, Al Buheira Corniche Tel 06 5736100 Fax 06 5736080 Mokhtar Kassem Branch Manager

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May 2009 51

Bank Muscat Dubai Representative Office Dubai Creek Tower, Baniyas Road, Deira P.O. Box 29969, Dubai Lawrence P. Monteiro Chief Representative

Tel 04 2222267 Fax 04 2210115

BBK BSC Dubai-Representative Office Dubai Creek Tower Office 18A, Baniyas Road, Deira PO Box 31115 Website History: Established on 16th March, 1971

04 2210560 Tel 04 2210560 / 70 Fax 04 2210260 www.bbkonline.com

Murad Ali Murad Karim Bucheery Sh. Rashed Al Khalifa

Chairman CEO & GM Deputy General Manager

Dubai ReP-Office: Head of Representative Office Rajiv Kapoor Al-Alwan

CK Jaidev Relationship Manager & Loan Syndications Wafa Relationship Manager & Loan Syndications

Bank of Baroda Dubai Zonal Office: Sheikh Rashid Bldg. Ali Bin Abu Talib Street, Bur Dubai, P.O.Box 3162, Dubai Tel: 04 3531628 E-mail: [email protected] Fax: 04 3530839 UAE Website: www.bankofbarodauae.ae History: Established in 1908, July 20 Nationalized on July 19, 1969 Senior Management & Personnel – Baroda Corporate Centre, Mumbai, India. Dr. A.K. Khandelwal Chairman & Managing Director Mr. V. Santhanavanam Executive Director Mr. S.C. Gupta Executive Director Zonal Office, Dubai: Ashok K. Gupta L.J. Asthana J.K.Jais P.M. Bondarde Sujeet Bhale Rajesh Jain

Chief Executive, (GCC operations) Senior Manager (Credit) Senior Manager (Inspection) Senior Manager (Credit) Senior Manager (Syndication) Senior Manager (Internal Auditor)

04 3538093 04 3531628 04 3531628 04 3531628 04 3531628 04 3531517

Abu Dhabi: Al Halami Centre, Sheikh Hamdan Street 02 6330244/ 6322000 K. Venkateshwarlu Chief Manager 02 6344302 K.Shridhar Senior Manager (Credit) R.G. Shanker Senior Manager (Operations) Al Ain: Clock Tower, Round about, Planning Street Sarabjeet Singh Senior Branch Manager Vijay Kumar Goel Senior Manager (Operations) Dubai:

03 7519880 03 7659554

Sheikh Rashid Bldg.Ali Bin Abu Talib Street,

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Bur Dubai, Vinod Malhotra Asst. General Manager Shekhar Tripathi Senior Manager (Operations) M.K. Patel Senior Manager (Credit) Beena Desai Manager (India Desk) Retail banking Shoppe, Dubai Mr. Saravana kumar Mr Ketan Dave Mr Vinay Rathi

04 3531955 04 3534516 04 3530166 04 3534080 04 3537586 04 3534390 04 3540041 04 3540340

Deira Kuwaiti Bldg., Al Rigga, Baniyas Street, Deira Rajiv K. Garg Chief Manager Yuvraj Singh Senior Manager (Operations) P.K. Gambhir Senior Manager (Credit) R.K. Madaan Manager

042287949 04 2286516 04 2286216 04 2292181 04 2292181

Ras Al Khaimah: Al Qasimi Bldg, Oman Street, Al Nakheel P.K.Bhargav Senior Branch Manager

07 2229293 07 2229293

Sharjah Al Mina Road 06 5684231/ 5686232 M.S. Chouhan Asst. General Manager 06 5683273 D. Pathania Senior Manager (Credit) 06 5684231 D. Guha Senior Manager (Operations) 06 5686232 Bank of New York Representative office Suite 402, The Blue Tower, Sh. Khalifa Bin Zayed Street P.O.Box 727, Abu Dhabi Hani Kablawi Managing Director

Tel 02 6263008 Fax 02 6263308

Bank of Sharjah Sharjah Head Office – Al Hosn Avenue Tel 06 5694411 P.O. Box 1394, Sharjah Fax 06 5694422 E-mail: [email protected] History: Established on 22nd December 1973 with Banque Paribas, Paris Ahmed Abdulla Al Noman Chairman Varouj Nerguizian General Manager Mario Tohme Deputy General Manager Fadi Ghosn Deputy General Manager Ali Burheimah Commercial Manager Mohammed Asghar Senior Operations Manager Fares Saade Senior Manager Michel Germanos Risk Manager Jayakumar Menon Finance Manager Berj Tossounian Credit Manager - Sharjah Wahide Assaad    IT Manager Jihad Aoun    Investment Manager Samer Hamed    Audit & Control Manager Abu Dhabi Tel 02 6795555 Al Mina Street, P.O.Box 27391 Fax 02 6795843 Ramzi Saba Senior Manager Mazen El Attar Operations Manager- Abu Dhab Anni Barsoum Credit Manager - Abu Dhabi Dubai Tel 04 2827278 Al Gharoud Street, PO Box 27141 Fax 04 2827270 Nadim Melki Senior Manager Toufic Youakim Credit Manager - Dubai Fadi Haddad Operations Manager - Dubai Al Ain 03 7517171 Khalifa Street, PO Box 84287 Fax 03 75170770 George Dib Branch Manager Rida Higazi Deputy Branch Manager

Barclays Capital Dubai International Financial Centre, Level 9, West Wing, The Gate Building, Sheikh Zayed Road, Dubai Nicholas Hegarthy Managing Director, Head of Middle East & North Africa

Bank Saderat Iran Dubai Regional Office, Al Maktoum Street, P.O. Box 4182

Tel 04-6035555 Fax 04 2229951

Dr.Hamid Borhani                 Regional Manager Abdul Reza Shabahangi         Assistant Regional Manager Mohammad Yousefi Peyhani       Assistant Regional Manager Majid Tavasoli                            H.R. & Organization Dept. Manager Gholamreza Joulaie               Credit Facility Dept. Manager Rahim Erfan Moghaddam        Account Dept. Manager Mehran Arzhang                        Letter of Credit Dept. Manager                Majid Mirnasiri                          Recovery Dept. Manager Hamdi Reza Khalajzadeh         Dealing Dept. Manager Hojatollah Malek Mohammadi    IT Dept. Manager Mansoor Sedaghat Motlagh        Service Dept. Manager  Mohsen Hossein Hosseinpour   Manager of Al Maktoum Branch Gholamreza Ebadi Fard          Manager of Murshid Bazar Branch Saeed Mirzaian Tafti         Manager of Sheikh Zayed Rd. Branch Ferdos Zolfagharian            Manager of Bur Dubai Branch Seifollah Farzan Mehr      Manager of Sharjah Branch Jalil Vosooghi                            Manager of Ajman  Branch Ali Abasteh                       Manager of Abu Dhabi Branch Peyman Sabri                 Manager of Al Ain Branch

Banque Du Caire Abu Dhabi Regional Head Office (02) 6225880 P.O. Box 533, Abu Dhabi Telefax 02-6225881 History: Established on 8th May, 1952 On July 1, 1960 the Amman Branch became independent under the title of Cairo Amman Bank. In July, 1961 the Bank was nationalized. On November 2, 1962 the Lebanese branches were absorbed by Banque Misr-Liban S.A.L On October 1, 1979 fo3rmer branches in Saudi Arabia have been saudized and a new bank was formed under the name of Saudi Cairo Bank. Mohamed kamal Al Deen Barakat Chairman                     Ahmad Sherif Rehab Regional Manager   Abu Dhabi - UAE PO Box 533 Tel:        02-6272525 Abu Dhabi Branch  Mohamad Kamal Farid (Acting Manager) Tel:         02-6273000 Dubai Branch    Labib Abdul Ghaffar Tel:         04-2715175 Sharjah Branch      Tareq Hafez Tel:         06-5739379 Ras Al Khaima      Mohamad Abdul Ghani (Acting Manager) Tel:         07-2332245 Al Ain                          Abdul Hamid  Saeed Tel:         03-7511104

Barclays Bank PLC Dubai Emaar Business Park, Building No. 4, Sheikh Zayed Road P.O. Box: 1891, Dubai Website www.barclays.com Saleem Sheikh Africa Mark Petchell Amin Habib Faizen Mitha Farrukh Zain Florence Goodman David Inglesfield ing Callum Watts-Reham Clients

Tel: 04 3626888 Fax: 04 3663133

Regional Managing Director, Middle East & North Group Country Managing Director Director - Corporate Banking Regional Treasurer Head of Trade Sales Head of Corporate Afffairs & Public Relations Location Manager - International & Premier BankDirector, Market Manager, Gulf - Barclays Private

BLC Bank (France) S.A. Head Office 17-19 Avenue Montaigne 75008 Paris, France Mr. Andre Tyan General Manager

Tel 33 1 56 52 11 00 Fax 33 1 56 52 11 11

Regional Office Dubai Al Maidan Tower, Al Maktoum St. Tel 04 2222291 P.O. Box 4207, Dubai Fax 04 2283935 E-mail: [email protected] Melhem Dagher Administration & Operations Manager Dubai Al Maidan Tower, Al Maktoum St. P.O. Box 4207, Dubai Hamze Abdul Sater Branch Manager Abu Dhabi Mohd. Joan Al Badi Bldg., Hamdan St. P.O. Box 3771 Ghassan Haddad Acting Regional Manager Samir Rached Acting Branch Manager

Tel 04 2222291 Fax 04 2279861

Tel 02 6220055 Fax 02 6222055

Sharjah Al Salam Bldg., Al Mina St. P.O. Box 854 Victor Khoriaty Branch Manager

Tel 06 5724561 Fax 06 5727843

Ras-Al-Khaimah Sheikh Ahmad Bin Saker Al Quasimi Bldg., Al Montaser St. P.O. Box 771 Abd El Hajj Branch Manager

Tel 07 2286222 Fax 07 2275067

BNP Paribas Abd Ahmad Al Hajj Branch Manager Abu Dhabi Khalifa Street, P.O. Box, 2742, Abu Dhabi Marc Checri General Manager

Tel 02 6130400 Fax 02 6268638

Central Bank of the U.A.E Abu Dhabi Tel 02 6652220/6915555 Head Office, Al Bateen Area, Bainoona Street Fax 02 6668483/6668621 P.O.Box: 854, Abu Dhabi, www.cbuae.gov.ae E-mail: [email protected] Swift: CBAU AE AA Reuters dealing code: CBEM History Established in 1980 as a central bank of the United Arab Emirates by a federal decree. Central bank took over the activity of the United Arab Emirates currency board which was established in 1973. Management & Personnel H.E. Sultan Bin Nasser Al-Suwaidi Governor H.E. Mohd. Ali Bin Zayed Al Falasi Deputy Governor Board of Directors H.E. Mohd. Eid M. Jasim Al-Meraikhi H.E. Jumaa Al-Majid

BANKING AND BUSINESS REVIEW

Chairman Vice Chairman

May 2009 53

H.E. Sultan Bin Nasser Al-Suwaidi

Governor

Members Ali Al-Sayed Abdulla, Jamal Nasser Lootah, Khalifa Nasser Bin Huwaileel, Saeed Rashid Al Yateem Al Muhairy Executive Directors Saeed Abdulla Al Hamiz nation Dept. Rashid Mohamed Al Fandi Saif Hadef Al Shamesi Salem Ahmed Al-Hammadi Abdulla Hamad Al-Zaabi Jamal Ebrahim Al Mutawaa

Executive Director-Banking Supervision & ExamiExecutive Director - Banking Operations Dept. Executive Director - Treasury Department Executive Director - Research & Statistics Department Executive Director - Internal Audit Department Executive Director - Administration Department

Economic Advisors Abed Alla Osama Malki, Mohammed Zeitouni Bechri Portfolio Managers Mohammed Abdulla Mohammed, Brian Gardner Anti-Money Laundering & Suspicious Cases Unit Abdul Rahim Mohamed Al Awadi Asst. Executive Director General Secretariat & Legal Affairs Division Salem Said Al Kubaisi

Senior Manager

Financial Control Department Hassan Ibrahim Al Hamar

Senior Manager

Personnel Division Ali Ghurair Al Romaithi

Senior Manager

Correspondent Banking Division Sultan Rashed Al-Sakeb

Senior Manager

Public Relations Division Abdul Raheem Abdullah

Manager

Information Technology Division/ UAE Switch Division Khalifa Al Dhaheri Dubai P.O. Box 448 Omar Al Qaizi Manager-in-Charge

Senior Manager Tel: 04 3939777 Fax: 04 3937802

Sharjah Tel: 06 5592592 Old Airport Road, Opp. Immigration Bldg., P.O. Box 645, Sharjah Fax: 06 5593977 Zakaria Abdul Aziz Al Suwaidi Senior Manager Ras Al Khaimah Al Nakheel, Oman Street, P.O. Box 5000 Salem Jasem Al Baker Asst. Executive Director

Tel: 07 2284444 Fax: 07 2284646

Fujairah P.O. Box 768, Fujairah Ali Mubarak Saeed Abbad Senior Manager

Tel: 09 2224040 Fax: 09 2226805

Al Ain Ali Ibn Abee Taleb Street, Oud Al Touba P.O. Box 1414 Ajlan Ahmed Al Qubaisi Asst. Executive Director

Tel: 03 656656 Fax: 03 664777

Citibank N.A (UAE Branches) Date of Establishment 1964 Nationality USA Legal Status

54 BANKING AND BUSINESS REVIEW

May 2009

Commercial Banking Services (F) Regional Head Office Oud Metha Towers P.O Box 749, Dubai – UAE Tel: 04- 3245000 Telex: 023 6738736 Cable: CITIBAEM Swift: CITIAEAD Reuters: N/A Email: [email protected] Website: www.citibank.ae Auditors: KPMG Domestic Branches: Al Wasl Road Branch (Main Branch) Tel: 04 3245000 Oud Metha Road, P.O Box 749 Dubai Branch (Next to Burjuman) Tel: Abu Dhabi Branch Tel: 02 6982206 Al Salam Street, Next to Lulu Center Fax: 02 6726381 P.O Box 999, Abu Dhabi Sharjah Branch Tel: 06 5072101 Beside Sharjah Emigration, Fax: 06 5723378 Opposite Civil Court. Sharjah Al Ain Branch Tel: 03 7641090 Sh. Zayed Street Fax: 03 7663887 Broad of Directors: N/A General Management: Mohammed E. Al- Shroogi, MD for the Middle East and Chief Executive Officer, UAE Sanjoy Sen, Country Business Manager Global Consumer Group - U.A.E Mohammed Azab, Chief Officer, UAE Offices, Citi Private Bank

Clearstream Banking Dubai Tel 04 3310644 City Tower 2, Sheikh Zayed Road Fax 04 3316973 Website: www.clearstream.com Robert Tabet Vice President Middle East & North Africa

Commercial Bank International Dubai Tel 04 2275265 Head Office Dubai  Al Riqqa Street Deira , P.O  Box 4449                       Tel : 04  2275265   Website : www.cbiuae.com   Hamad Al Mutawaa H.E. Humaid Al Qatami Abdulla Rashid Omran

Fax : 04 2279038

Mohammed Saadeh Abdulla Amer Jasem Hesham Abdulla Ahmed Mustafa Tahoun Ramanthan Murgappan Zainab Nour Aldin Yousef Haddad Bashir Haji Mohd A.D.Abooty K.E Mammoo Faris Saddi Yousef Al Marshoudi Tariq Selaij Ameena Bin Kaali Ahmed Al Junaibi Abdulla Ali Almadhani Mohammed Ishaq Ahmed Darwish

Head of GBG 04 2126500 Head of HR & Admin 04 2126466 Head of Branches & Services 04 6020615 Head of Internal Audit & compliance Division 04  2126603 Senior Manpower planning & Recruitment Manager 04 2126444 Employee Relations Manager 04 2126 442 Planning & Development Manager 04 2126190 Chief Dealer 04 2126214 Head Of Operations & Finance 04 2126291 Accounts Manager 04 2126215 Chief information Officer 04 2060700 Dubai Branch Manager 04-2275265 Bur Dubai Manager 04-3559577 Sheikh Zayed Branch Manager 04 3405555 Abu Dhabi Branch Manager 02-6913111 Al Ain Branch Manager 03 7669994 RAK  Branch Manager (AL Manar Mall) 07 2274777 RAK  Branch Manager (Nakhel Branch) 07 2227555

Chairman   Deputy Chairman   Managing Director and Board Member 04  2242104

Alyia Al Mulla Ahmed Bin Masood Fujairah Branch Manager

Sharjah Branch Manager

Dubai Main Branch (Al Riqqa Street) Yousef Al Marshaudi Branch manager Bur Dubai Tariq Sulaij Branch manager Sheikh Zayed Road Ameena Mhd. Bin Kaadi Branch manager Abu Dhabi Ahmed Sulaim Al Junaibi Branch Manager AL AIN Abdulla Ali Branch manager Ras Al Khaimah Khaled Al Mannai Branch Manager (Manar Mall) Ahmed Yousef A. Darwish Branch Manager (Nakeel Branch) Sharjah Aliya Al Mulla Branch manager

06 512100 09 2011777 04 2126101 04 3555511 04 3405555 02 6264400 03 7669994 07 2274777 07 2227555 06 5687666

Commercial Bank of Dubai Main Branch , Al Ittihad Street, Port Saeed, Dubai Ibrahim Salama Branch Manager 04 212 1000 Dubai Branch, Mankhool Street, Dubai Amer Al Shamali Branch Manager 04 352 3355 AL Maktoum Branch, Abu Baker Al Siddique Street Ahmed Al Aboodi Branch Manager 04 268 3555 Deira Branch, Baniyas Street Mohammad Al-Sayed Al-Hashemi Branch Manager 04 225 3222 Baniyas Square Branch, Al Maktoum Hospital Street Mohd. Al Lawati Branch Manager 04 228 9000 Jebel Ali Branch, Jebel Ali Free Zone Mohammed Abdulla Mardood Branch Manager 04 881 8882 Jumeirah Branch, Jumeirah Beach Road Areffa Al Hashimi Branch Manager 04 344 1438 Sheikh Zayed Road Branch, Ghaya Towers, Sheikh Zayed Road Maher Marzouqi Branch Manager 04 334 777 Al Garhoud Branch, Al Haj Saleh Bin Lahej Building, Al Garhoud Street-Deira Ali Salman Branch Manager 04 282 6444 Al Qusais Branch ,Al Nahda Street Abdullah Lootah Branch Manager 04 261 5000 Souq Al Wasl Branch, Souq Al Wasl Street Taher Mohammed Branch Manager 04 227 6111 Al Aweer Branch, Central Fruit and Vegetable Market, Al Aweer Ibrahim Al Ramsi Branch Manager 04 320 1222 Naturalization and Residence , Administration – Dubai Branch Adel Abdul Aziz Branch Manager 04 398 5000 Mr. Jamal Saleh Assistant General Manager, Head of Risk Management Abu Dhabi Branch, Corniche Street Wael Ahmed Mahfouz Branch Manager 02 626 8400 Musaffah Branch , Al Firdoos Building, Mussaffah Area M/3 Zahir M. Suaiman Branch Manager 02 555 5510 Khalidiya Branch, Khalidiya street Sultan Ali Al Assiry Branch Manager 02 667 9929 AL Ain Branch, Al Takhtit Street, Clock Tower Khalid Abdel Hadi Branch Manager 03 766 7800 Sharjah Branch, Immigration Road Abdul Aziz AL Ansari Branch Manager 06 574 0666 Ajman Branch, Shk.Humaid Abdul Aziz Street Marwan Ebrahim Mohammed Branch Manager 06 745 6668 Ras Al Khaimah Branch, Al Nakheel Area, Oman Street Ebrahim Ahmed Al Zaabi Branch Manager 07 228 6266 Fujairah Branch , Al Gurfa Road, Near Al Mibkhar Roundabout Abdullah Al Suwaidi Branch Manager 09 222 5111 H.E. Ahmed Humaid Al Tayer Chairman H.E. Saeed Ahmed Ghobash Deputy Chairman

H.E. Saeed Mohd Al Ghandi Deputy Chairman Mr. Abdul Wahed Al Rostamani Director Mr. Abdul Rehman Saif Al Ghurair Director Mr. Saeed Mohd Al Mulla Director Mr. Khaled Juma Al Majid Director Mr. Omar Abdulla Al Futtaim Director Mr. Peter Baltussen Chief Executive Mr. Yaqoob Yousuf Hassan Deputy Chief Executive Mr. Ibrahim Abdulla General Manager, Administration & Finance Mr. Mahmoud Hadi General Manager, Central Operations Mr. Faisal Galadari General Manager, Business group Mr. Ahmed Shaheen General Manager, Credit Group Mr. Abdul Rahim Al Nimer General Manager, Financial Services Mr. Stephen Davies Deputy General Manager, Corporate Banking Mr. Moukarram Att asi Deputy General Manager, Asset Management Mr. Thomas Smith Deputy General Manager, Head of Retail Mr. John Tuke Deputy General Manager, Treasury & ALM Mr. V.P Bhatia Assistant General Manager, Treasury Mr. Masood Azhar Assistant General Manager, SPD Mr. Amir Afzal Assistant General Manager, IT Mr. Adel Al Sammak Assistant General Manager, Corporate Banking Mr. Kanan Iyer Assistant General Manager – Internal Audit Mr. Clive Harrison Assistant General Manager – HR Mr. Alan Kerr Assistant General Manager, Corporate Banking Mr. Alan Hill Assistant General Manager, Treasury & Investment

Coutts & Co.

Representative Office - Dubai Tel 04 2217007 Twin Towers, Baniyas Street, Deira Fax 04 2217006 P.O. Box 42220 Sarah Deaves CEO Sandra Shaw General Manager Martin Bond Private Banker

Calyon Corporate & Investment Bank

  (Previously Crédit Agricole Indosuez & Crédit Lyonnais)   Dubai World Trade Centre, Level 32                            Tel:      04 3314211 P.O.Box: 9256                                                            Fax:     04 3313201 Website: www.calyon.com Amr Alkabbani                         Regional Manager – Gulf      04 3317316 Ludovic Bernard-Maissa          Regional COO                                                                                       Eric Fromaget                          Head of Private Banking         04 3321300 Sebastian Van der List            Head of Corporate Banking – UAE      04 3315836 Naeem Khan                            Trade Finance          04 3291055 Albert Mondjian                       Head of Investment Banking – MEA    04 4284803   Abu Dhabi Al Muhairy Centre, Level 5              Tel:      02 6351100 Block C, Sheikh Zayed the First Street          Fax:     02 6344995 P.O.Box: 4725 Ghazi Abdul Fattah                  Branch Manager           02 6351991

Credit Suisse Abu Dhabi Dhabi Tower, 4th floor, Sheikh Hamdan Street P.O.Box 47060 Jean-Marc Suter Director Dubai P.O. Box 33660

BANKING AND BUSINESS REVIEW

Tel 02 6275048 Fax 02 6274109

04 3620000

May 2009 55

The Gate bldg, 9th Floor Fax 04 3620001 Dubai International Finance Centre ( DIFC), Dubai Head of Regional Office Beat Naegell

Deutsche Bank A G Abu Dhabi P.O.Box 52333 E-mail: [email protected] Jens Moeller Representative

Tel 02 6333122 Fax 02 6322044

Dubai P.O. Box: 50490 Emirates Towers, Level 27b Fax 04 3199560 Karl French Director Tel : 04 3199514 Private Wealth Management - Asia Nadeem Masud Director Tel : 04 3199524 Global Markets Harris Irfan Vice President Tel : 04 3199520 Global Equities & Derivatives Rohit Johri Vice President Tel : 04 3199522 Private Wealth Management - Asia

Dresdner Bank AG Dubai Representative Office Burjuman Business Towers, 10th Floor, Office 1011 Bur Dubai, P.O. Box: 25654 Tel 04 3596444 Fax 04 3596116 E-mail: [email protected] Bashar A. Barakat

Tel 04 3328989 Fax 04 3290071

History: Established in September 2002 Chief Executive Officer

Dubai Islamic Bank Head Office Al Maktoum Street, Dubai Tel 04 2953000 P.O. Box 1080, Dubai Fax 04 2954111 Website: www.alislami.co.ae History: Established March 12, 1975 Dr. Mohammed Khalfan Bin- Kharbash Chairman Butti Khalifah Bin Darish Al- Falasi CEO Saad Mohammed Abdul Razzaq Deputy CEO Mohd. Saeed Al Sharif Executive Vice President-Finance Arif Ahmed Al Koheji Executive Vice President-Investment Banking Abdullah Ali Al Hamli Executive Vice President - Business Services Ahmed Mohammed Fadel Legal Consultant and Board Secretary Branches

56 BANKING AND BUSINESS REVIEW

May 2009

El Nilein Bank Abu Dhabi P.O.Box 46013 Tel 02 6269995 Fax 02 6275551 Abdulla Mahmoud Awad Manager Tel 02 6720934 Mohamed Osman Salih Deputy Manager 02 6761916 Murlidhar G. Ramchandani Chief Accountant & Dealer 02-6729300 Ahmed Hillali Ahmed Head Investment Dept. & Credit 02-6729300

Dubai Main Branch, Baniyas Road, Deira Tel 04 2256900 P.O. Box 2923, Dubai Fax 04 2267718

Dubai Bank

Ziad Makkawi

04 2959999 04 2233300 04-3437777 04 3907777 04 3971717 04 3429955 04 3406000 06 7466555 06 5726444 06 5584455 06 8826682 09 2370080 02 6346600 02 6677119 02 6450555 02 5825511 03 7644111 03 7515155 07 2284888 09 2221550

Emirates Bank International

Chief Representative Regional Head GCC & Yemen

Main Office Sheikh Zayed Road, Near Dubai World Trade Centre P.O. Box 65555, Dubai E-mail: [email protected] Website: www.dubaibank.ae

Deira Main Branch Al Souk Sheikh Zayed Rd Nad Al Shiba Bur Dubai Jumeirah Ladies Branch Al Barsha Ajman Sharjah Wasit Road Al Dhaid Khorfakan Abu Dhabi Khalidiah Ladies Branch Al Salam Bani Yas Al Ain Al Ain Mall Ras Al Kheimah Fujairah

Branches Abu Dhabi Hameed Sheikh Manager Al Ain Ghanim Al Hajeri Manager Al Maktoum Ali Malallah Manager Al Quoz Mohd. Abdulla Manager Baniyas Square Sherif Al Ulama Manager Bander Talib Fareed Aquilli Manager Dubai Main Branch Amal Al Qamzi Manager Fujairah Yousif Al Marshoudi Manager Internet City Balakrishnan Nair Manager Galleria Farida Al Balooshi Manager IBN Gardens Hamdan Mohd. Abdulla Manager Jebel Ali Free Zone Abdul Rahman Ibrahim Manager Karama Muna Al Falahi Manager

02 6455151 03 7510055/77

09 2222114/110 04 3910840/1

04 8844689 04 8815551

Karama Shopping Complex Nawal Al Khader Manager Mankhool Abdul Rahim Abdulla Manager Qiyadah Fatima Al Midfa Manager Ghusais Fatima Al Midfa Manager Ramoul Ibrahim Hassan Manager Ras Al Khaimah 07 2272333 Khalifa Bin Kalban Manager Satwa Mohamed Bilal Manager Sharjah Industrial Area 06 5345577 Mohamed Al Shouq Manager Sharjah 06 5733300 Mahmoud Saif Manager Souk Samia Al Aqady Manager Umm Suqueim Nazia Kalban Manager Tower Saif Al Mansoori Manager World Trade Centre Abdulla Sulaij Al Falasi Manager Najdah 02 6771919 Butti Al Assiri Manager

Emirates Industrial Bank Abu Dhabi - Head Office Tel 02 6339700 P.O. Box 2722, Abu Dhabi Fax 02 6319191/6326397 E-mail: [email protected] Dubai Tel 04 2211300 Arbift Tower, Deira P.O. Box 5454, Dubai Fax 04 2232320 E-mail: [email protected] Website: www.emiratesindustrialbank.net Senior Management Personnel/Branch ManagerMohamed Abdulbaki Mohamed General Manager Ahmed Mohamed Bakhit Khalfan Deputy General Manager Abdullah Rashed Omran Dubai Branch Manager Khalifa Al Falasi Acting Projects Division Manager Ali Ahmed Al Essa Development Services Division Manager Nasser Haji Malek Administration Manager Essa A. Bu Al Rougha Internal Audit Manager Mohamed Moneir Makled Finance Manager Salem Abu Baker Salem Acting Loans Division Manager

Emirates Islamic Bank P.O. Box: 6564, 2nd & 3rd Floor, Al Gurg Tower 1 Tel: 04 3160330 Plot 372 - Riggat Al Buteen, Deira, Dubai. Fax: 04 2272172 www.emiratesislamicbank.ae Ebrahim Fayez Al Shamsi CEO 04 3160330 Abdulla Showaiter (General manager – corporate and investment banking) Faisal Aqil General manager – retail banking Ahmed Fayez Alshamsi chief financial officer Syed Imran Bashir          Head of marketing and product development Samih Mohd Qadri Awadalla        head of branches Nasir Ahmed Khan                       head of consumer finance Zahir Mulla                                head of operations

IMB (Main Branch) P.O. Box: 6564, Al Gurg Tower 2, Riggat Al Buteen, Dubai. BUD (Bur Dubai) P.O. Box: 6564, Khalid Bin Walid Road, Dubai. DFR (Diyafa) P.O. Box: 6564, Diyafa Road, Dubai. RIQ (Riqqa) P.O. Box: 6564, Omar Bin Al Khattab Street, Dubai. ADC (Abu Dhabi) P.O. Box: 46077, Sheikh Rashid Bin Saeed Al Maktoum Street, Abu Dbahi. ROS (Ras Al-Khaima) P.O. Box: 5198, 191 Oman Street, Al Nakeel, Ras Al Khaima. Fuj (Fujairah) P.O. Box: 1472, Sheikh Hamad Bin Abdulla Street, Fujairah. AJS (Al Ain) P.O. Box: 15095, Jawazat Street, Al Ain. QFS (Umm Al-Qaiwain) P.O. Box: 315, King Faisal Road, Umm Al Qaiwain. SBA (Sharjah) P.O. Box: 5169, Al Arooba Bank Street, Sharjah.

Finance House P.J.S.C. Mr. Mohammed Abdullah Jumaa Al Qubaisi

Chairman

Mr. Abdul Hamid Umer Taylor General Manager 02 6194998 Mr. T.K. Raman Chief Operating Officer 02 6194889 Mr. Mohammed Wassim Khayata Executive VP – Strategic Planning 02 6194445 Mr. Ramesh S. Mahalingam Chief Investments & Financial Officer 02 6194601 Mrs. Shagufta Farid Khan Head of Internal Audit 02 6194223 Ms. Lina Abdul Hamid I. El Araj Manager – General Services 02 6194702 Mr. Tarek Soubra Vice President – Central Operations 02 6194362 Ms. Maha Al Jamal

Senior Manager – Marketing

02 6194893

First Gulf Bank Abu Dhabi Tel 02 6816666 Head Office, Sh. Zayed Second Street, Khalidiya P.O. Box 6316, Abu Dhabi Website: www.fbg.ae History: Established in 1979 Shareholder Equity of over AED 10 billion Senior Management Abdulhamid Mohammed Saeed Managing Director 02 6920502 Andre’ Sayegh Chief Executive Officer 02 6920506 Amit Wanchoo Head of Retail Banking Group Arif Shaikh Chief Credit & Risk Officer George Abraham Head of Corporate Banking Gopi Krishna Madhavan Head of Human Resources Hana Al Rostamani Strategic Planning Head Karim Karoui Head of Business Planning & Financial Control Nadeem A. Siddiqui Head of International Business Shafiqur Rehman Adhami SR. VP, CB FI\SYN\MNC\OIL & Energy Sector Zafar Habib Khan Chief Investment Officer Zulfiquar Ali Sulaiman Business Support Director

Habib Bank A.G. Zurich Head Office: Zurich, Switzerland Zonal Office: Dubai Tel 04 2214535 Baniyas Square Deira, P.O. Box 3306 Fax 04 2284211 E-mail: [email protected] Website: www.habibbank.com History: Established in 1967 Reza S. Habib Joint President Arif Lakhani Chief Executive Vice President 04 2229985 Asad Habib Senior EVP Afzal Memon Senior EVP Shariq Ali Senior EVP Deira Mains 04 2214535 Najibullah Khan Branch Manager Farrukh Iqbal Deputy Branch Manager Corporate 04 3513777 Awais Hasan Branch Manager Sharjeel Vijdani Deputy Branch Manager Al Fahidi Street 04 3534545

BANKING AND BUSINESS REVIEW

May 2009 57

Zain Ghazali Branch Manager Abdul Basheer Deputy Branch Manager Jebel Ali Nisar Chowdhary Branch Manager Ifthikhar Memon Deputy Branch Manager Sh.Zayed Branch Zia Abbas Mirza Branch Manager Kashif Aijaz Dodhy Deputy Branch Manager Abu Dhabi Sh. Hamdan Imamat Naqvi Area Manager Farhan Bakhshy Branch Manager Al Falah Syed Akhtar Hussain Branch Manager Raid Saleem Ansari Deputy Branch Manager Sharjah Al Boorj Avenue Younus Warsi Area Manager Kausarullah Khan Branch Manager

04 8812828 04 3313999

02 6346888 02 6422600 06 5730004

Habib Bank limited Abu Dhabi Tel 02 6224688 Main Branch, Corniche Road, P.O.Box 897, Abu Dhabi Fax 02 6225620 E-mail: [email protected] History: Established on August 25, 1941Nationalised on January 1, 1974 On June 1974 absorbed Habib Bank Ltd. On June 30, 1975 absorbed Standard Bank Ltd., Karachi Aman Aziz Siddiqi EVP/RGM 04 3597753 Mohammad Tanvir HR. Manager 04 3592292 Fouad Farrukh GRM 04 3592214 Sh. Abdul Basit AVP/CAD Manager 04 3592539 M. Amin Usman AVP/Treasury 04 3591893 Ahmed Faraz Faruqi VP/Head ICU 04 3592517 Nadeem Zia VP/Head FINCON 04 3592292 Syed Ali Gohar VP/IT/Head 04 3592820 Abdul Shahid Khan VP/Head Cops 04 3591874 Abu Dhabi Sh. Zayed Road, 2nd Street Mushtaq H. Shah Service Manager 02 6344557 Abu Dhabi Main Branch M. Saadat Cheema VP/Chief Manager 02 6224655 Al Ain 03 7642555 Abdul Jalil Al Fahim Bldg. Adbul Hameed Khan AVP/Senior Manager 03 7642555 Dubai Regional Office Sahibzada M. Taimur SVP/Corporate Manager 04 3596922 Sameera Mohammad Service Manager 04 3592016 Sheikh Zayed Road, Kalantar Tower Khalid Bin Shaheen SVP/Director 04 3431421 Mahdi Hassan Business Development Manager 04 3438081 Isar-Ul-Haq Service Manager 04 3438081 Deira Branch, Creek Road Zulfiqar Ahmad Bhatti Service Manager 04 2253292 Sharjah 06 5682552 / 5683473 Al Boorj Avenue Assad Ali Shaikh AVP/Branch Manager 06 5695122 Dhaid & Dibba 06 8822249 Near Al Dhaid Police Station 06 8822249 Abdul Sattar Badi Service Manager 06 8822249

HDFC Bank Representative Office: Dubai

58 BANKING AND BUSINESS REVIEW

Tel 04 3966991

May 2009

Juma Al Majid Bldg., Opp Bur Juman Centre P O Box 64546, Email: [email protected] Faisal Saeed Cheif Representative

Fax 04 3967010 Tel 04 3966991

HSBC Bank Middle East Ltd Head Office: Jersey, Channel Island Middle East Management Office, Dubai Internet City Tel: 04 3904722 Fax: 04 3906607 HSBC Bldg., Dubai Internet City, P.O. Box: 66, Dubai, UAE Web: www.hsbc.ae UAE Web: www.uae.hsbc.com Youssef Nasr Chairman David Hodgkinson Director Ken Matheson Regional Chief Operating Officer Abu Dhabi 02 6332200/6152215 Al Ain 03 7641812 Dubai 04 3535000 Deira 04 2227161 Fujeirah 09 2222221 Jebel Ali 04 8846133 Ras Al Khaimah 07 2333544 Sharjah 06 5537222

IndusInd Bank Dubai Representative Office Tel 04 3978803 203, Safa Commercial Bldg. Fax 04 3978805 Opp. Bur Juman Centre, P.O. Box: 111873, Dubai. E-mail: [email protected] Pradeep Gupta Vice President & Chief Representative 04 3978804

ING Asia Private Bank Ltd Dubai Representative Office Tel 04 4277100 602, Level 6, Building 4 Fax 04 4257801 Burj Dubai Square Sheikh Zayed Road P.O Box 4296, Dubai – UAE Suresh Nanda Managing Director & Head Eric Lorentz Managing Director Varun Bukshi Executive Director Melwyn Dias Executive Director B.R. Subramanian P.G. Bhaskar Ranjit Paul Piyush Bhandari Nitin Bhatnagar Rishi Chauhan Asad Dadarkar Ashraf Al Yamani

Director Director Director Director Director Director Director Director

InvestBank Sharjah Tel 06 5694440 Al Boorj Avenue, P.O. Box 1885 Fax 06-5694442 E-mail: [email protected] Website: www.invest-bank.com History: Established on 2nd February 1975 as Investment Bank for Trade & Finance On July 1, 1995 name changed to Investbank. Sami Farhat General Manager

Qasim Kazmi AGM. Operations & Treasury Taleb Zaarour Senior Manager-ADM & Legal Athar Anis Manager, Credit Risk Bassam Hollmerus Chief Dealer Sajjad H. Holimerus Trade Finance Madhu Pilakazhi Financial Controller Ghassan Accari Personnel Manager Vinay Gupta IT Manager Dubai Sheikh Zayed Road Dubai Al Maktoum Street Al Ain Al Ghaba Street Abu Dhabi Sh. Khalifa street Abu Dhabi Mussaffa Area Sharjah Industrial Area

Dubai Customer Service Centres Community Centre at Arabian Ranches, Dubai Dubai Healthcare City (Behind Wafi City)

04 3213131 04 2285551 03 7644446 02 6794594 02 5555336 06 5420333

Janata Bank Abu Dhabi Obied Sayah Al-Mansuri Building Tel No 02-6331400 Electra Road, Post Box No. 2630 Fax : 02-6348749 Email [email protected] Mr. Md. Masuduzzaman Chief Executive 02-6344543 Mr. Md. Chaynul Haque IT Manager/SPO 02-6340881 Mr. Md. Ramjan Bahar System Administrator/PO 02-6340881 Abu Dhabi Mr. Mohamudul Hoque Manager 0 2-6344542 Dubai Mr. Md. Abdul Awal Manager Mohammad Saleh Al-Gurg Building 0 4-2281442 Al-Borj Street, P.O. Box 3342 Mr. Md. Mizanur Rahman Manager Sharjah Saqer Bin Rashid Al Quassim Building Al Suwaiheen Street, P.O. Box- 5303 0 6-5687032 Mr. Md. Mizanur Rahman Manager Al Ain Branch Mr. Md Shahadat Hossain Manager Sk. Khalifa Bin Mohd. Al-Nahyan Building, Main Market Centre, Main Street, P.O. Box- 1107 0 3-7513425

Lloyds TSB Bank plc Dubai Main Branch Al Wasl Road, Opp. Safa Park Tel 04 3422000 P.O. Box: 3766, Dubai, UAE Fax 04 3422660 E-mail: [email protected] Website: www.lloydstsb.ae Vivek Vohra Head of Corporate Origination Giles Cunningham Regional Manager, UAE & Gulf States 04 3023267 Bert de Ruiter Managing Director 04 3023267 Steve Williams Consumer Banking Director 04 3023267 Jon Mortell Head of Corporate Banking 04 3023266 Suresh Jadhwani Treasury Manager 04 3023256 Tim Goddard Head of Operations and IT 04 3023250 Derek Vaz Head of Finance and Planning 04 3023330 Caroline Ridley HR Manager 04 3023270 Steve Snowdon  Head of Middle Office Alex de Melo Head of Treasury Trading Edson Suppo Head of Treasury Strategy & Risk Claire Thomas Head of Human Resources

Tel 04 3023318 Fax 04 3618035 Tel 04 3023349 Fax 04 3624805

Man Investments Middle East Limited Representative Office Dubai Tel 04 3604999 Level 5, West Wing, The Gate, Dubai Internaional Financial Centre Fax 04 3604900 P.O. Box: 73221, Dubai Website: www.maninvestments.com E-mail: [email protected] Patrik Merville Chief Executive Officer Kamlesh Bhatia Deputy Chief Executive Officer

Mashreqbank Dubai Tel 04 2223333 Head Office, Omar Bin Al Khatab Street, Deira Fax 04 2226061 P.O. Box 1250, Dubai History: Established on 1st May, 1967 as Bank of Oman Limited. On October 1st 1993 name was changed to MashreqBank PSC. bdullah Al Ghurair President and Chairman Abdul Aziz Al Ghurair CEO Ali Raza Khan Head of Corporate Affairs Douglas Beckett Head of Retail Banking Omar Bouhadiba Head of Investment and Corporate Banking Nabeel Waheed Head of Treasury and Capital Markets Nigel Morgan Head of Audit Review & Compliance Majid Husain Head of Financial Institutions Somnath Menon Head of Operations & Technology Kantic DasGupta Head of Risk Management Alexander Sinclair Head of Technology Mubashar Khokhar CEO of Badr Al Islami Ebrahim Kazi Head of Marketing and Corporate Communications Saad Hakim Events and Public Relations Manager Al Khaleej Street, Deira 04 2717771 Souq Al Kabir Branch 04 2264176 Hor Al Anz, Deira 04 2623100 Jumeirah Branch 04 3441600 Jebel Ali 04 8815355 Khor Branch 04 3534000 Bur Juman Centre 04 3527103 Al Riqa, Deira 04 2229131 Al Aweer 04 3333727 Abu Dhabi 02 6274300 Main Branch, Khalifa Street Musaffa 02 5555051 Zayed the 2nd Street 02 6334021 Al Salam Street 02 6786500 Al Mushrif 02 4432424 Baniyas 02 5821100 Muroor 02 4481858 Khalidiya 02 6665757 Al Ain 03 7667700 Al Ain Main Street Ali Ibn Abi Tailb St. 03 7669968 Ajman 06 7422440 Shk Humaid Bin Abdul Aziz Street, Near Ajman Museum Fujairah 09 2221100 Sh. Hamad Street Ras Al Khaimah 07 2361644 King Faisal Street.

BANKING AND BUSINESS REVIEW

May 2009 59

Al Nakheel RAK Sharjah Main Bank Street, Rolla King Abdul Aziz Street Dhaid Main Street, Sh. Arsan Hameed Bldg., Dhaid Dibba Kalba Kalba City Khorfakkan Umm Al Quwain King Faisal Street, Next to New Souk

07 2281695 06 5684366 06 5730883 06 8822899 09 2444230 09 2777430 09 2385295 06 7666948

Merill Lynch International & Co.C.V Representative Office Dubai (04) 3975555 Business Center Building, Khalid Bin Walid Street P.O. Box 3911, Dubai Telefax Executive Director

04-3975252 Mones Bazzy

NATIXIS Dubai Branch DIFC Gate Village Building No. 8, 5th Floor P.O Box 33770 Email: [email protected] Website: www.natixis.fr Philippe Petitgas CEO

Tel 04 7026777 Fax 04 7026820

National Bank of Abu Dhabi Head Office: Abu Dhabi 02 - 6111111 One NBAD Tower, Khalifa St., P.O. Box 4, Abu Dhabi Telex 22266/7 MASRIP EM History: Established in 1968 H.E. KHALIFA MOHAMED AL KINDI Chairman H.E. DR. JAUAN SALEM AL DHAHIRI Deputy Chairman MICHAEL H. TOMALIN Chief Executive ABDULLA MOHAMMED SALEH ABDULRAHEEM GM & Chief Operating Officer SAIF ALI MOHAMED MUNAKHAS AL SHEHHI GM Domestic Banking Division QAMBER ALI AL MULLA GM International Banking Division ABHIJIT CHOUDHURY GM & Chief Risk Officer JOHN GARRETT GM & Chief Audit & Compliance Officer Abu Dhabi Main Branch 02 - 6111111 Khalidiya 02 - 6666800 Dept. of Social Services & Commercial Buildings 02 - 6346673 ADCO 02 - 6672642 ADMA 02 - 6263225 ADNOC 02 - 6669143 Abu Dhabi Municipality 02 - 6744749 NPCC 02 - 5549282 ZADCO 02 - 6768821 HILTON 02 - 6812280 Abu Dhabi International Airport 02 - 5757303 Sheikh Rashed Bin Saeed Al Maktoum Road 02 - 6419800 Abu Dhabi Mall 02 - 6452200 Arabian Gulf Road 02 - 4478878 Baniyas 02 - 5831625 Bateen 02 - 6658332 Between The Two Bridges Area 02 - 5589446 Corniche 02 - 6220300

60 BANKING AND BUSINESS REVIEW

May 2009

Dalma Island TAMM Das Island Liwa Madinat Zayed Government Complex Al Mirfaa Al Ruwais Al Muroor Mussafah Dept. of Social Services & Commercial Buildings (Mussafah) Mussafah Municipality Industrial City of Abu Dhabi Al Salam St. Al Shahama New Al Shahama Abu Dhabi Municipality-Shahama Sweihan Marina Mall Al Etihad Emirates Palace National Exhibition Centre Mina Road

02 - 8781240 02 - 8945528 02 - 8731099 02 - 8822388 02 - 8846146 02 - 8945428 02 - 8836506 02 - 8776343 02 - 4481918 02 - 5553357 02 - 5520681 02 - 5540300 02 - 5501125 02 - 6442900 02 - 5632411 02 - 5635695 02 - 5631385 03 - 7347919 02 - 6816002 02 - 6111111 02 - 6908900 02 - 4494996 02 - 6767665

Al Alin Al Ain Clock Tower Al Ain Al Ain Cement Factory Al Ain International Airport Al Ain Defence Al Sanaiya Al Hayer Al Ain Mall

03 - 7642400 03 - 7516900 03 - 7828060 03 - 7855511 03 - 7688824 03 - 7213222 02 - 7322400 03 - 7519900

Ajman Ajman

06 - 7422996

Dubai Deira Dubai Side Jebel Ali Sh. Zayed Road Al Qusais Jumeirah Mall of the Emirates

04 - 2226141 04 - 3599111 04 - 8815655 04 - 3433311 04 - 2674176 04 - 3499001 04 - 3413888

Fujairah Fujairah Dibba

09 - 2222458 09 - 2444223

Ras Al Khaimah Al Nakheel Ras Al Khaimah

07 - 2281753 07 - 2334333

Sharjah Al Bourj Avenue Sharjah Al Falah Camp Office Al Dhaid Khorfakkan Kalba

06 - 5695500 06 - 5721111 06 - 5385969 06 - 8822929 09 - 2385250 09 - 2772112

Umm Al Quwain Umm Al Quwain

06 - 7660033

National Bank of Bahrain Abu Dhabi Khalaf Bin Ahmed Al Otaiba Building, Sh. Hamdan Street P.O.Box 46080 Email: [email protected] Website: www.nbbonline.com Farouk Khalaf Ingersoll Ramalingam

UAE Country Manager Manager Credit

Tel 02 6335288 Fax 02 6333783

02 6335299 02 6311248

National Bank of Dubai Dubai Tel 04 2222111 Head Office Baniyas Street, Deira Fax 04 2283000 P.O. Box 777 Email: [email protected] Website: www.nbd.com History: Established in1963 as National Bank of Dubai Limited. In 1994 name was changed to National Bank of Dubai. R. Douglas Dowie Joyshil Mitter Alex Richardson Leslic Rice Abdul Shakoor Tahlak Ghanim Bin Zaal Ali Al Najjar Suvo Sarkar Rajesh Thaper Faranak Foroughi Husam Al Sayad G. Krishnamoorthy Sue Evans Alan M. Smith A. Chandran Walid El Masri Rashmi Malik Abdul Fattah Sharaf Mohamed Al Neaimi Ali Kaitoob P.S. Sastry Hesham Qassimi

CEO CFO COO CRO CM - Intl. CM - Business Development CM - Liability Head of Retail Head Of Corporate Head of TPO Head of HR Treasurer Head of IS&T Head of Group Audit Head of BPQM Head of Corp Comm Head of Strategy GM NFS GM Aqarat Head of Dist. Retail SM CEO’s Office Divisional Manager Corporate Banking

Abu Dhabi P.O. Box: 386 Ajman P.O. Box: 712 Ajman Archives Al Mizhar Al Ain P.O. Box: 16122 Burjuman Centre Bullion Convention Centre Branch Dubai Central Fruit & Vgtbl. Mkt Branch Al Awir Dubai International Airport Dubai International Airport Pay Office Dubai Internation Airport Dubai Internation Airport Dubai Internation Airport Dubai Internation Airport Dubai Internation Airport Dubai Media City Pay Office Deira City Centre Dubai Airline Centre

Tel : 02 6394555 Tel : 06 7456555 Tel : 06 7444606 Tel : 04 2641221 Tel : 03 7644345 Tel : 04 3555222 Tel : 04 2284757 Tel : 04 3320808 Tel : 04 3333880 Tel : 04 2200404 Tel : 04 2164946 Tel : 04 2162450 Tel : 04 2166995 Tel : 04 2162452 Tel : 04 2162434 Tel : 04 2162740 Tel : 04 3902007 Tel : 04 2951555 Tel : 04 2952555

Fax : 02 6346767 Fax : 06 7456060 Fax : 06 7425883 Fax : 04 2640569 Fax : 03 7668515 Fax : 04 3554455 Fax : 04 2289090 Fax : 04 3320908 Fax : 04 3333870 Fax : 04 2244614 Fax : 04 2244614 Fax : 04 2244614 Fax : 04 2244614 Fax : 04 2244614 Fax : 04 2244614 Fax : 04 2244614 Fax : 04 3908855 Fax : 04 2951525 Fax : 04 2955655

Dubai Airport Free Zone Dubai Courts Dubai Media City Pay Office Emirates Tower Fahidi Emirates Tower Emirates Tower Fahidi Direct Banking Fujairah Branch P.O. Box: 1744 Hamriya Hatta Ibn Battuta Mall Branch Ittihad Road Jumeirah Branch Jebel Ali Main Office Maktoom Branch Malleq Emirates Branch Muhaissnah Branch Nadd Al Shiba Oud Metha Branch (Ex-Gulf Tower Branch) Ras Al Kaimah P.O. Box : 1932 Rashidiya Souk Madinat Jumeirah Branch Sh. Zayed Road (Saeed Tower) Sharjah P.O. Box : 21850 Umm Al Quwain P.O. Box : 22 Emirates Tower Umm Suqeim

Tel : 04 2995550 Tel : 04 3366702 Tel : 04 3030400 Tel : 04 3300133 Tel : 04 3535575 Tel : 04 3530308 Tel : 04 2823400 Tel : 04 3532840 Tel : 09 2233335 Tel : 04 2663189 Tel : 04 8523183 Tel : 04 3685499 Tel : 04 2955600 Tel : 04 3420202 Tel : 04 8816087 Tel : 04 2222111 Tel : 04 2281141 Tel : 04 3410777 Tel : 04 2544545 Tel : 04 3363939 Tel : 04 3370222 Tel : 07 2279888 Tel : 04 2859523 Tel : 04 3686130 Tel : 04 3313183 Tel : 06 5738888 Tel : 06 7656154 Tel : 06 7656152 Tel : 04 3485222

Fax : 04 2995557 Fax : 04 3353906 Fax : 04 3908855 Fax : 04 3300155 Fax : 04 3535575 Fax : 04 3534601 Fax : 04 2823640 Fax : 04 3531443 Fax : 09 2233336 Fax : 04 2690103 Fax : 04 8521051 Fax : 04 3685501 Fax : 04 2955611 Fax : 04 3421112 Fax : 04 8816961 Fax : 04 2283000 Fax : 04 2235456 Fax : 04 3410707 Fax : 04 2544646 Fax : 04 3363788 Fax : 04 3366145 Fax : 07 2279889 Fax : 04 2854847 Fax : 04 3686195 Fax : 04 3310629 Fax : 06 5733000 Fax : 06 7655151 Fax : 04 3300155 Fax : 04 3482535

National Bank of Oman Abu Dhabi Bin Sagar Towers, Najda Street Tel 02 6348111 / 6323456 P.O. Box 3822 Fax 02 6325027 Ravi S. Khot Country Manager 02 6393028 Salim Al Khanjri Manager - Operations 02 6392535 Minhajuddin Niazi Manager - Consumer Banking & Business Development 02 6326560 K.K. Gambhir Manager - Corporate Banking 02 6394922

National Bank of Umm Al Qaiwain History: Established in 1982 24/7 Call Centre Number: 600 56 56 56 E-mail: [email protected] Website: www.nbq.ae Sh. Nasser Bin Rashid Al-Moalla Mohamed Abdel Rahim Al Mulla Umm Al Qaiwain Branch NBQ Building, King Faisal Street P.O.Box 800, Umm Al Qaiwain Falaj Al Mualla Branch NBQ Building, Shaikh Zayed Street P.O.Box 11074 Falaj Al Mualla Dubai Branches NBQ Building, Khalid Bin Al Waleed Street P.O. Box 9715 Dubai  Deira Branch Opposite Dubai Police Head Quaiter Al Ittihad Street, P.O. Box 8898 Deira, Abu Dhabi Branch Hamdan Bin Mohammed Street (# 5) P.O. Box 3915 Abu Dhabi  Mussafah Branch P.O. Box 9770 Abu Dhabi

BANKING AND BUSINESS REVIEW

Managing Director General Manager Tel: 06 7066666 Fax: 06 706 6677 Tel: 06 8824447 Fax: 06 8824445 Tel: 04 3976655 Fax: 04 3975382 Tel: 04 2651222 Fax: 04 2651333 Tel: 02 6775100 Fax: 02 6779644 Tel: 02 5555088 Fax: 02 5553559

May 2009 61

Al Ain Branch Oud Al Touba Street Al Mandoos Roundabout P.O. Box 17888 Al Ain Sharjah Branch King Faisal Street, P.O.Box 23000 Sharjah NBQ Kiosk Sharjah Mega Mall P.O.Box 23000 Sharjah Ajman Branches City Center Branch Ajman City Center P.O.Box 4133 Ajman Masfout Branch NBQ Building Main Street P.O.Box 12550 Masfout, Ajman Fujairah Branch Fujairah Insurance Co. Building Hamad Bin Abdulla Road P.O.Box 1444 Fujairah Ras Al Khaimah Branch Corniche Al Qawasim Road P.O.Box 32253 Ras Al Khaimah

Tel: 03 3751300 Fax: 03 7513500 Tel: 06 5742000 Fax: 06 5742200 Fax: 06 5742200

Tel: 06 7436000 Fax: 06 7436060 Tel: 04 8523377 Fax: 04 8523093 Tel: 09 2232100 Fax: 09 2232220 Tel: 07 2366444 Fax: 07 2364470

Philippine National Bank Dubai Representative Office Room 108, Al Nakheel Bldg., Zabeel Road, Karama Tel 04 3365940 P.O. Box 52357, Dubai, UAE Fax 04 3374474 E-mail: [email protected] Amroussi Tillah Rasul First Vice President & Regional Representative

Rafidain Bank

Abu Dhabi Al Nasser Street, Glass Bldg. P.O.Box 2727, Abu Dhabi Salah Mahid Branch Manager

Tel 02 6335882 / 3 Fax 6326996

Tel 04 3313196 Telefax 04 3313960

RAK Bank Ras Al Khaimah Head Office, Oman Street, Al Nakheel Tel 07 2281127 P.O. Box 5300 Fax 07 2283238 E-mail: [email protected]; www.rakbank.ae History: Established in 1976 as The National Bank of Ras Al Khaimah. In 2003, name was changed to RAKBANK H.E. Sheikh Omar Bin Saqr Al Qasimi H.E. Sheikh Salim Bin Sultan-Al-Qasimi Mr. Hamad Abdulaziz Al Sagar Mr. Essa Ahmed Abu Shuraija Al Neaimi Mr. Majid Saif Al Ghurair

62 BANKING AND BUSINESS REVIEW

Director Director General Manager Head of Personal Banking Head of Corporate Banking Chief Operating Officer Head of Internal Controls Head of Credit Head of Treasury Chief Internal Auditor Head of Human Resources Head of Finance Tel : 04-2248000 Tel : 04-2248000 Tel : 04-2248000 Tel : 04-2248000 Tel : 04-2248000 Tel : 04-2248000 Tel : 04-2248000 Tel : 04-2248000 Tel : 04-7058444 Tel : 04-3685890 Tel : 06-5746888 Tel : 06-5132666 Tel : 09-2778707 Tel : 09-2371900 Tel : 03-7644222 Tel : 02-6448227 Tel : 02-6666658 Tel : 07-2333744 Tel : 07-2666833 Tel : 07-2448822 Tel : 04-8525999 Tel : 07-2662434 Tel : 07-2351147 Tel : 07-2281127

Sharjah Islamic Bank

Royal Bank of Canada

Dubai Representative Office API World Tower, Suite 1002, Shk. Zayed Road, P.O. Box: 3614. Umaima Zaman senior manager Ashwani.k.Dewitt senior manager Global Private Banking Ashish Anand Chief Representative

Mr. Ali Samir Al Shihabi Mr. Yousuf Obaid Essa Mr. Graham Honeybill Mr. Ian Hodges Mr. Anil Sukhia Mr. Steve O Hanlon Mr. Geoff Harman Mr. Jose Braganza Mr. Malcolm D’Souza Mr. Nigel Summersall Mrs. Susan Gardner Mr. Venkat Raghavan Dubai Deira Maktoum Branch Deira Souk Branch Umm Hurair Branch (Bur Dubai) Sultan Business Center ( Dubai Main Branch) Sheikh Zayed Road Branch Emaar Business Park Branch Marina Diamond Branch Al Quoz Branch Al Qusais Branch Ibn Battuta Mall Branch Sharjah Sharjah Main Branch Sharjah Industrial Area Kalba Branch Khorafakkan Branch Al Ain Al Ain Branch Abu Dhabi Abu Dhabi-Tourist Club Branch Khalidiya Branch Ras Al Khaimah RAK Town Branch Sha’am Branch Badr Branch Al Mannei Branch Al Rams Branch Al Dhait Branch Al Nakheel Branch

Chairman Director Director Director Director

May 2009

Mohammed Abdalla Chief Executive Officer Ahmed Saad ibrahim Chief Operating Officer Mohammed Rizwan Chief Risk Officer Saeed M Ahmed Al Amiri Head, Investment Group Ossama Salah El Din Head, Retail Banking G . Ramkirshinan Head of Coroprate Banking Group Hussam A. Abu Aisheh SVP-Chief Internal Audit Mohammed Ishaq Chief Dealer Mohamed Azmeer Head of Credit Division Eman Jasim Sajwani Head of Human Resources Group Myron Britto Head, nformation Technology Div.-CIO Sufyan Maysara Head of Shariaa Supervision Divison Branches Main Branch - Al Brooj Avenue Mohammed Yousif King Faisal Street Branch Abdul Salam Al Ali Ladies Branch Laila Ali Salem American Unversity Branch Mohd Mousa Ali Al Dhaid Branch Khalid M. Ajmani Industrial Area Branch Waleed Abdul Qadir Sharjah Expo Branch Jassim Al Awadi Sharjah Buhaira Branch Osama Ahmed AlSalman Khorfakhan Branch Yousif M. Abdullah Dibba Branch Ali Al-Abdouli

06-5115116 06-5115118 06-5115172 06-5115000 06-5115339 06-5115111 06-5115153 06-5115151 06-5115319 06-5115170 06-5115444 06-5115213 06-5115121 06-5746805 06-5746807 06-5585789 06-8829414 06-5397623 06-5992502 N/A 09-2387490 09-2442601

Kalba Branch Fujairah Branch Dubai Branch Sheikh Zayed Branch Al Twar Branch Abu Dhabi Branch Al Ain Branch



Abdullah Bin Hikal Nawal Mohamed AlMaghribi Mohamed Ibrahim Alghufili Maisoon Zainudin Maha AlBanna Thomas P.Y. Majid Sha’abaan

09-2774204 09-2244339 04-2698322 04-3217543 04-2638335 02-6224166 03-7513200

Shuaa Capital PSC Head Office Tel: 04 3303600/ 04 3199778 Emirates Towers Hotel, Level 7 Fax: 04 3303550 P.O. Box: 31045, Dubai, UAE. Website: www.shuaacapital.com Iyad Duwaji CEO Abeer Ayash Marketing and PR coordinator

Societe Generale Dubai DIFC Gate Village, Bldg. 6, 4th Floor Tel.: 04 4257500 Sheikh Zayed Road, Dubai Fax: 04 3653170 Website: www.socgen.com Alain L. Tave Chief Regional Representative

Standard Bank Plc - Dubai Branch (DIFC) Dubai Emirates Tower, Office-16 B Tel 04 3300011 P.O. Box 504904 Fax 04 3300169 Website: www.standardbank.com Jeffrey Rhodes General Manager 04 3300164 Kate Lunjevich Head of Compliance & Operations

Standard Chartered Bank Head Office: United Kingdom Dubai Main Branch Tel 04 3520455 Head Office: Al Fardan Building, Fax 04 3526679 Mankhool Road, Bur Dubai P.O. Box: 999, Dubai - United Arab Emirates www.standardchartered.com/ae/ Phone Banking: +9714 3138888 (24 hours) Dubai Branch P. O. Box 999, Al Mankool Road, Dubai , UAE 04-3599550 Deira Branch P. O. Box 1125, Al Nasr Square, Dubai, 04-5085300 Gold Souq Branch P. O. Box 64555, Gold Souq, Dubai , UAE 04-2262699 Jebel Ali Branch P. O. Box 16920 , Jebel Ali, Dubai , UAE 04-5085200 Sharjah Branch P. O. Box 5, Al Boorj Avenue, Sharjah , UAE 06-5916100 Hamdhan Branch P. O. Box 240,Al Fardan Tower ,Abu Dhabi, UAE 02-6165600 Istiqlal Branch P. O. Box 241, Istiqlal Street, Abu Dhabi UAE 02-6165400 Al Ain Branch P. O. Box 1240, Near Clock Tower, Al Ain, UAE 03-7056800 Dragon Mart Branch P. O. Box 4166, Dragon Mart mall, Dubai, UAE 04-5085260 Emaar Business Park Branch P. O. Box 103669,Building 3 ,Dubai , UAE 04-5085255 Wealth Management Center P.O Box 999, Jumeira Beach Road, Dubai UAE 04-5085706

The Housing Bank for Trade & Finance Abu Dhabi P.O. Box 44768 Muhanad Habashneh Representative

Tel 02 6268855/6270280 Fax 02 6271771

Union de Banques Arabes et Francaises UBAF Dubai Creek Tower, Baniyas Road, Deira Tel 04 2284080 P.O. Box 29885 Fax 04 2284070 Hamed Hassouna Chief Representative GCC & Yemen

UBS AG Abu Dhabi ADNIC Bldg., 5th Floor, Sh. Khalifa Street P.O.Box 3744 Website: www.ubs.com Roger Leitner Senior Representative

Tel 02 6275024 Fax 02 6272752

Dubai Creek Tower, Office 17A, Baniyas Road, Deira Peter Schaer Senior Representative

04 2240044 04 2220006

DIFC Gate Village, Bldg. No. 6, 5th Floor Sheikh Zayed Road P.O Box 506542 Per Larsson Senior Representative

Tel.: 04 3657150 Fax: 04 3657191

Union National Bank Abu Dhabi Head Office, Salam Street, P.O.Box 3865, Abu Dhabi Website: www.unb.ae History: Established as a Public Joint Stock Company in 1982 Nahyan Bin Mubarak Al Nahyan Chairman Mohammad Nasr Abdeen Chief Executive Officer Abu Dhabi Corniche City Centre Najda Hazzaa Khalidiya Adgas Booth Musaffah Shahama Baneyas Al Dhafra/Madinat Zayed Al Muroor Al Ain Sh. Khalifa Street Al Jimi Dubai Main Branch, Deira Al Maktoum Street Khalid Bin Al Waleed Road Al Bustan Jebel Ali Sheikh Zayed Road/Jumeira Rashidiya

BANKING AND BUSINESS REVIEW

Tel 02 6741600 Fax 02 6786080

02 632 1600 02 627 3471 02 632 4981 02 641 2288 02 635 2511 02 627 0611 02 555 9111 02 563 4600 02 582 1886 08 884 8484 02 444 8384 03 7644551 03 7626240 04 2211188 04 2232266 04 3516444 04 2636388 04 8810999 04 3329911 04 2857686

May 2009 63

Ajman Central - Emirates Post Fujairah Ras Al Khaimah Sharjah King Abdul Aziz

06 7425552 09 2222747 07 2286600 06 5686141 06 5746161

United Arab Bank

General Manager Dy. General Manager Asst. GM-Corporate & Retail Asst. GM-Admin. & Finance

06 5733900 06 5733900 06 5733900 06 5733900

United Bank Limited Dubai Gargosh Bldg, Khalid Bin Waleed Street

64

Fax 04 3514525

Wachovia Bank National Assoc.

General Management & H.O. Tel 06 5733900 Sh. Abdulla Bin Salim Al Qassimi Building, Al Qasimia St., Sharjah Fax 06 5733906 E-Mail Address [email protected] Website www.uab.ae History: Established 1975 Bertrand Giraud Awni Alami Gibert Hie Arif Premdjee

P.O. Box 1367, Dubai Email: [email protected] Website: www.ubl.com.pk Wajahat Husain Head of Middle East Maruf Ahmed General Manager UAE

Tel 04 3552020

Representative Office Dubai The Atrium Centre, Khalid Bin Waleed Street, Bur Dubai 04 3556244 P.O. Box 53089 Fax 3557117 Head Office: USA J.Kennedy Thompson Chairman & Chief Executive Officer Michael P. Heavener International Division Dubai Branch: Chafic Haddad Vice President & Regional Manager Carol Hampson Customer Services Representative

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