Wednesday, 25 March 2009

Emirates NBD to Convert $3.43 Billion Deposits to Tier 2 Capital

Emirates NBD PJSC, the United Arab Emirates’ biggest bank by assets, plans to convert 12.6 billion dirhams ($3.43 billion) of federal government deposits into Tier 2 capital, Chief Executive Officer Rick Pudner said.

The state-controlled bank’s capital adequacy ratio will rise to 15.6 percent, from 11.4 percent at the end of last year, after the deposits are converted into capital, Pudner told a conference today.

The lender needs to add 3.5 billion dirhams to its Tier 1 capital by the end of June, Chief Financial Officer Sanjay Uppal said earlier. The bank doesn’t plan to offer shares to raise the Tier 1 capital and it is likely to be in the form of a “perpetual debt instrument,” he said.

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