Bankruptcy Law ‘critical’ in stimulating overseas investment: UAE banks
Say it will mutually benefit banks and owners of businesses, especially SMEs
The CEO Advisory Council of the UAE Banks Federation, the professional body representing 49 banks in the UAE, has welcomed the bankruptcy law, and recognised the mutual benefit it will bring to banks and owners of businesses, especially the Small and Medium Enterprises (SMEs).
This came up during the council’s third meeting of the year held on Monday in Dubai, which discussed a number of important topics impacting the UAE’s banking sector, including the legislation of the UAE’s bankruptcy law, as well as progress made by ‘Modus Operandi’ (which was launched by the Federation earlier in the year) to support SMEs.
The meeting was chaired by Abdulaziz Al Ghurair, Chairman of the Federation.
The participants discussed the recent approval of the UAE Bankruptcy Law by the UAE Cabinet.
Acknowledging the significance of the SME sector to the UAE economy, they noted the important role the bankruptcy law plays in other dynamic economies around the world.
They also recognised the bankruptcy law as a critical factor, both, in stimulating new entrants to the SME sector and inward investment from overseas.
“We commend and welcome the legislation of the Bankruptcy Law, which the government has recognised as a pre-requisite for the country’s economic development, and an essential tool to maintain the well-being of the business and economic environment.
“All banks were involved and responsible for considering every option to support their clients, and help them stay in business and succeed, especially SMEs which represent over 90 per cent of the country’s non-government GDP,” commented AbdulAziz Al Ghurair, Chairman of the UAE Banks Federation (UBF).
Through ‘Modus Operandi’ banks were able to put in place a total Dh7 billion of outstanding loans for more than 1700 SMEs and corporates, restructured and under negotiation to restructure.
“The meeting also focused on other areas in which we could contribute for the same objective – namely to help build as strong and resilient an economy for the UAE as possible,” he added.
The council also praised the progress made on the Mobile Wallet project as per the memorandum of understanding recently signed by all 16 UAE equity partner leading banks, considering this as an important milestone in the development and implementation of the project.
Furthermore, the council underscored the importance of customer service and enhancement of customer experience.
During the meeting, Stephen Jordan, Managing Director – Group Treasurer at NBAD, who is also a member of the UBF Financial Markets committee, presented the committee a paper which highlighted the changing role of regulatory reserves given the continuing developments in the international regulatory environment.
The meeting also discussed the progress of the preparation for the Federation’s 4th Middle East Banking Forum, which is due to take place in Abu Dhabi on 14th November under the theme “Transforming the Customer Experience”.