Tuesday, OcTOber 28, 2014 khaleej times

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making inroads intothemainstream

give us a perspective of islamicbanking in theUae,andalso tell usabout its contribution to the nom-inal gdP of the Uae?

The UAE has been a pioneer withinthe Islamic banking industry. Eversince the establishment of DubaiIslamic Bank (DIB) in the 1970s,the industry has constantly grownover the past few decades. To date,it is estimated that Islamic bankingin the UAE constitutes around 18per cent of the total banking assetof Dh2 trillion as of 2013. Thecompetitive landscape is heatingup with several Islamic banks of-fering a diverse range of Shariah-compliant products and servicesacross various sectors ranging fromretail to wholesale to specialisedproducts such as Takaful.

In 2013, the UAE’s nominalGDP estimated at $400 billion wasup by 5 per cent from the previousyear. Islamic finance has been astrong contributor to the overalleconomic growth. For instance in2013 a number of landmark capi-tal market transactions were initi-ated where Islamic finance was in-volved: the Emirates Airlines $1billion sukuk and the Dubai $750million sovereign sukuk, both is-sues being extremely successful.On the consumer side, the UAE-based Islamic banks continue topenetrate the market through in-novative Shariah-compliant prod-ucts across a broad spectrum ofretail services.

Moving forward with the govern-ment’s initiative to establish Dubaias a Capital of the Global IslamicEconomy, Islamic finance and DIBare set to expand further, boostedby the anticipated growth in theoverall UAE economy.

Whatmeasureshaveyou takenasa bank to broaden the appeal ofislamic banking among the largeexpatriate population?

Dubai Islamic Bank caters to allcustomer segments and does notfocus on a niche segment. Duringthe last few years, we initiated spe-cific programmes and projects witha clear target to plug all productand service gaps that existed with-in DIB in order to have a morecomprehensive and fulfilling offer-ing for all our customers. Thisstrategy has worked exceedinglywell as DIB has so far been the top-performing bank in 2014 beatingmarket expectations by a widemargin. With ample liquidity andstrong capitalisation, we are readyto further strengthen and entrenchour position in the banking sectorin the UAE. We want to make bank-ing a simple exercise for all.

kindly enlist some of the popularproducts in this space.

As one of the largest and well-en-trenched consumer franchises inthe UAE, we are cognisant of theneeds of the expatriate populationand over the years have investedheavily in developing products andofferings built around their require-ments. For example, a few yearsago, we were primarily focused onproviding home finance to UAE na-tionals only, but now, particularlyafter the acquisition and integra-tion of Tamweel, we have en-hanced our offering for expats, andhave become the largest mortgageprovider in this segment. Homeremittances are always a key con-cern for many expatriates andknowing this we have tied up withWestern Union. It allows expatri-ates with accounts in DIB to remitfunds to identified beneficiaries intheir home countries through awide variety of channels includingonline banking.

Another product widely used inthe UAE is Remit-to-ATM, a prod-uct that we pioneered. It allows ac-count holders to provide instantcash to anyone in UAE via DIBATM, irrespective of whether therecipient is a customer or not.Many of our expat salaried custom-ers now have the convenience ofgetting additional cash through theSalary-in-Advance product, whichprovides instant credit to their ac-counts. Furthermore, the BusinessOnline platform provides our SME

Serving the UAE for almost four decades, Dubai IslamicBank has pioneered a number of products and services thatsuits the banking and financial needs of its clients. The bankhas constantly improvised its offerings, and reached out to awide population. In an exclusive chat with Khaleej Times,DrAdnanChilwan, CEO, Dubai Islamic Bank, talks aboutthe Islamic banking and finance industry, the importance ofthe World Islamic Economic Forum in Dubai and muchmore. Excerpts:

Dr Adnan Chilwan, CEO, Dubai Islamic Bank

The 10th World Islamic Eco-nomic Forum (WIEF),which is being held underthe patronage of His High-

ness Shaikh Mohammed binRashid Al Maktoum, Vice-Presi-dent and Prime Minister of theUAE and Ruler of Dubai, will beattended by more than 2,000 par-ticipants from over 100 countries.The three-day event will run untilOctober 30.

“We are happy to welcome allthe WIEF delegates to Dubai. The

wide international representation,especially the presence of so manyheads of government, economicexperts and stakeholders, willmake the 10th WIEF a definitiveplatform of innovative partner-ships. Over the next few days, welook forward to a period of highlycreative engagement on the Islam-ic economy that will benefit thedelegates as well as the countriesthey represent, and enhance theposition of Dubai as an Islamiceconomy hub,” said Abdulrahman

SaifAlGhurair,ChairmanofDubaiChamber of Commerce and In-dustry (DCCI) and Board Memberof the Dubai Islamic Economy De-velopment Centre.

Musa bin Hitam, Chairman ofWIEF Foundation, said: “Dubaicomplements the forum very wellwith its massive pool of businesscommunity, world-class infra-structure, and its strategic locationconnecting the east and the west.The 10th edition in Dubai has gath-ered nine heads of state, 12 minis-ters, four Central Bank governors,181 role-players, and about 2,000delegates from more than 100countries. We definitely look for-ward to a successful forum.”

Bearing the theme, ‘InnovativePartnerships for EconomicGrowth’, it serves to promote morecross-border and cross-industrycollaborations through a series ofthought-provoking discussionsand robust networking sessions.

Globalcapitalof islamiceconomySeveral heads of government anddelegates fromover 100 countries willattend the 10th WIEF in Dubai

Abdulrahman Saif Al Ghurair,Chairman, DCCI

Musa bin Hitam, Chairman, WIEF

segment with over 90 services re-lated to banking and e-governmentincluding settlements with DeG(Dubai Smart Government), DED(Department of Economic Devel-opment), and Dubai Trade thoughdirect connectivity with these keyentities. Our foreign exchange cashservice at Dubai International Air-port is another step in our focusedstrategy of expanding touch pointsin the expat-populated areas.

the islamic development Bank(idB) recently listed $1-billion su-kuk in dubai nasdaq. What is thesignificance of this event?

This is another clear testament toDubai’s unique positioning as be-ing the critical pillar of the globalIslamic economy. The infrastruc-ture supporting the initiative of HisHighness Shaikh Mohammed binRashid Al Maktoum, Vice-Presi-dent and Prime Minister of theUAE and Ruler of Dubai, is in placeand institutions like IDB are nowrecognising the same. Simultane-ously, such events will triggerstronger ties with IDB’s memberstates and further strengthen tradeand related activities betweenthem and the UAE.

since the financial crisis of 2008,globally people are looking at is-lamic banking and finance as therightful alternatives. What areyour views on this?

Right at the onset, I want to clarifythat Islamic banking caters to allsegments of banking and financeand not just to the niche Muslimpopulation, which is sometimes

the perception among developedcountries. At DIB, we offer com-prehensive banking services acrossall customer segments and indus-try sectors of the economy. Islamicbanking and finance does not allowfor speculation in any way andhence structures that are essen-tially dependent on uncertain out-comes are eliminated from our of-ferings to our customers. Similarly,as a general thumb rule, the pur-pose or asset being financed isidentified upfront and hence, thereis a greater understanding of wherethe money is going and what it isused for. These factors stood outduring the last few years as Islamicinstitutions generally remainedmore resilient compared to its con-ventional peers.

That said, the basic rules of goodgovernance and quality risk man-agement remain just as importantfor Islamic as for conventional in-stitutions. Quality disciplines suchas these, combined with focusedinnovation and optimum use oftechnology are key to driving theIslamic banking industry forward.External stakeholders includingevolution in legislations and laws isanother major factor which Islamicbanks have to drive in order to fur-ther entrench this already fastgrowing industry in the global fi-nancial landscape.

identify constraints or challengesfaced by the industry in the Uae?

I feel that purely from a bankingand finance perspective, the chal-lenges that Islamic banks face arevery similar to those faced by con-ventional counterparts. These re-late generally to market move-ments and changes in globalbenchmarks and indices, competi-tion, and general economic condi-tions among others. However, as arelatively nascent industry, Islamicbanking still has room to grow inorder to gain some of the econo-

mies of scale that conventionalplayers enjoy. That said, over thelast decade or so, the sector hasgrown at nearly twice the rate ofthe conventional one and is set tobecome a far more significantforce. Innovation has also been amajor challenge, particularly withcertain products that have key reli-ance on interest-based lending.We, at DIB, have made huge in-roads in terms of working withShariah scholars to develop highquality, competitive and easy touse products to our growing clien-tele, thereby plugging any signifi-cant gaps in our product suiteacross consumer and wholesale.However, there are still areas par-ticularly around liquidity manage-ment and trade that Islamic insti-tutions need to focus on to takeadvantage of this ever-growing op-portunity in global trade and work-ing capital financing. Lastly, regu-lators in the UAE have beenextremely helpful in establishingIslamic liquidity management op-tions for institutions like us. Butagain, DIB and many other playersrequire many more products tomanage excess liquidity and,though Islamic CDs with CentralBank and the Sukuk investmentsare strong options, more productsare required for both short-termand long-term liquidity manage-ment. Finally, legislations and lawsneed to be enhanced to accommo-date the activities of Islamic fi-nance as more and more institu-

tions, governments, corporatesand individuals are leaning to-wards this fast growing form ofbanking and finance.

What is your take on theWorld is-lamic economic Forum in dubai?

We are looking for a sustainablestrong growth journey for DIB forthe benefit of our customers aswell as shareholders. Simultane-ously, we want to promote and el-evate Dubai’s ambitions in becom-ing the capital of the global Islamiceconomy. At the same time, as thefirst Islamic Bank in the world anda global leader in Islamic bankingand finance, we are committed tostrengthening the overall industryand economy through proactivedialogues with the regulators, in-stitutions, academia as well as thebroader social society.

Final word

We believe that, in this overcrowd-ed space, we need to make thebusiness of banking simple for ourcustomers. We believe that sincewe compete in the banking sector,the greatest differentiator will bethe quality of service and how easythe customers’ overall interactionis with our bank. Thus, in line withthe Shaikh Mohammed’s initiativeof establishing Dubai as a “SmartCity”, we have already moved for-ward with positioning DIB as the“Smart Bank” for all our custom-ers, a concept which will be rolledout to all our touch points by theend of October this year. The aimis simple: To make banking experi-ence with DIB enjoyable; so lesstime, no paper, and incrediblyfaster turnarounds. “Smart Bank”is the new and renewed servicecommitment that we extend to ourcustomers and is sure to transformthe service industry across, notjust the financial sector, but theentire market in the UAE.

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khaleej times Tuesday, OcTOber 28, 2014

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State-of-the-artOnline&MobileBanking

Cutting-edgeTechnology Platforms

Tie-up with DubaiSmart Government forOnline Payments

www.dib.ae

Paperless Branches

SmartBankforaSmartCity

IntroducingDIB ‘SmartBank’Aligned to the futuristic vision of Dubai’s leadership,

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supporting the plans of making Dubai a Smart City.

DIB ‘Smart Bank’ is a revolutionary concept that promises

customers a never-before banking experience bymaking

banking quick, seamless and satisfying.

To achieve this, Dubai Islamic Bank has invested in

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completely new and refreshing experience across all

aspects of banking – from paperless branches, to faster

turnaround times and instant online services.

Fully aligned to the vision of Smart Dubai, DIB ‘Smart Bank’

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And the passion to continue to lead the way as the

better way to bank.

Customer transactions are completedwithout filling formsbyusinghandheld electronicdevices.Digitalsignatures are taken for secure andefficient processing.Accountopening formalities are completedandATMcards andchequebooksissuedwithin 15-20minutes.ThepaperlessDIB ‘Smart Bank’experience is nowavailable at overeighty fivebranches in theUAE.

DIB ‘Smart Bank’ takes DubaiIslamic Bank’s leadership in onlinebanking to the next generation.With cutting-edge innovation andextensive state-of-the-art technology,DIB ‘Smart Bank’Online &MobileBanking brings customers a bankingexperience that’s instant, secureand convenient.

What makes DIB ‘Smart Bank’ thenext generation in banking is DubaiIslamic Bank’s solid investment andhands-on experience in cutting-edgeinformation andbanking technology.This extensive use of technology tocreate a completely new andrefreshing experience across allaspects of banking is fully aligned tothe vision of a Smart Dubai.

A first of of its kind in the bankingindustry, with this tie-up, DubaiSmart Government (DSG) willelectronically link the Government’sResources Planning (GRP) Systemsand Dubai Islamic Bank, through anautomated and fully integratedplatform provided by and in linewiththe DIB ‘Smart Bank’mission.