UPDATE 1-National Bank of Abu Dhabi to expand Islamic banking


(Adds expansion plans)

KUALA LUMPUR, Oct 8 (Reuters) - The National Bank of Abu

Dhabi, the second-largest bank in the United Arab

Emirates (UAE) by assets, plans to triple its contribution from

Islamic banking by introducing sharia-compliant services in

Egypt, Oman and Malaysia.

NBAD aims to derive up to 10 percent of its operating income

from Islamic banking by 2020, from 3 percent currently, chief

executive Michael Tomlin told reporters at the launch of its

Malaysian subsidiary on Monday.

NBAD has invested 310 million ringgit ($101.5 million) in

paid-up capital to establish a wholly-owned subsidiary in

Malaysia where it will focus on conventional products for

wholesale clients.

NBAD issued a 500 million ringgit sukuk, or Islamic bond, in

Malaysia two years ago that earned a coupon rate of 4.9 percent

after its orderbook was oversubscribed by more than two times.

NBAD is 70.5 percent owned by the government of Abu Dhabi

and recently expanded into Malaysia and China, taking its global

presence to 14 countries. The contribution to group operating

profit from its overseas businesses rose to 28 percent in the

first half of 2012, compared with 16.3 percent last year.

"Our strategy is to take the bank from a presence in 14

countries to around 41 countries in the next ten years," senior

general manager of NBAD's international banking division Qamber

Ali Al Mulla said.

It aims to open 30 branches in Malaysia within the next

decade. Malaysia has also been named as a regional hub for NBAD,

with plans to expand into Indonesia and Singapore.

"Malaysia represents a strategic importance for us given its

ideal geographical location, stability and healthy market

climate. Malaysia was chosen given its significant economic

clout in the region and its robust trading activities with the

Gulf," said the company in a statement.

($1 = 3.0545 Malaysian ringgit)

(Reporting by Al-Zaquan Amer Hamzah; Editing by Matt Driskill

and Mark Potter)

By using Yahoo you agree that Yahoo and partners may use Cookies for personalisation and other purposes