DUBAI, March 5 (Reuters) - Emirates NBD ENBD.DU said it was seeking to raise 6.3 billion dirhams ($1.72 billion) by converting emergency federal deposits into Tier 2 capital to provide support during the financial crisis, its chief financial officer said.
Sanjay Uppal said the conversion would boost the bank's capital adequacy ratio -- a key measure of the soundness of a bank -- to 14.3 percent from 11.3 percent at the end of 2008, when the bank wrote off 2.26 billion dirhams in assets.
"This is not really a bailout," Uppal told Reuters in an interview on Thursday. "I would consider it a bailout when the central bank is injecting money into the bank to support it," Uppal said. "I see this as systemic support.
ENBD would convert the deposits, provided last year to a number of UAE banks, to a 7-year bond paying 4.5 percent interest and non-convertible for 5 years, which would be used to supplement the regulatory capital reserve known as Tier 2.
(Reporting by Thomas Atkins, editing by John Irish)
See earlier clip at http://rupertbumfrey.blogspot.com/2009/03/enbd-to-convert-dh126bn-ministry.html
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