Dubai Islamic Bank reveals $425m of exposure to NMC Health
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Dubai Islamic Bank reveals $425m of exposure to NMC Health

Dubai Islamic Bank reveals $425m of exposure to NMC Health

Dubai Islamic Bank is in talks with NMC’s other main creditors and advisers to ascertain the hospital operator’s financial position

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Dubai Islamic Bank shares dropped the maximum allowed after the lender said it has $541m of exposure to NMC Health, which could wipe out almost half of its estimated profit for this year.

The Dubai-based bank had about $425m of exposure at the end of March, while NMC owed its subsidiary Noor Bank about $116m, according to a statement.

Dubai Islamic Bank said it’s now in talks with NMC’s other main creditors and advisers to ascertain the hospital operator’s financial position and address its governance and financial issues. The bank said it will work closely with all stakeholders to prioritise the preservation of the group’s healthcare operations.

The shares lost as much as 4.8 per cent shortly after Dubai’s market opened.

Dubai Islamic Bank has no exposure to Finablr, UAE Exchange or any other group company that is not directly engaged in the provision of medical services, it said. The aggregate exposure constitutes about 0.7 per cent of the bank’s total assets.

Biggest creditors

Abu Dhabi-based NMC disclosed last month said that its non-executive directors had uncovered alleged theft and excess undisclosed borrowings by former directors. Trading in the shares has been suspended since Feb. 27, the board has sacked top executives and dismissed board members and banks that lent to the company are facing losses on the debt.

Abu Dhabi Commercial Bank, one of NMC’s biggest creditors with nearly $1bn in exposure, on Saturday said it asked a court in the UK to put the troubled hospital operator into administration. That move prompted the company’s chairman Faisal Belhoul to counter that such an action would endanger the lives of people living in the United Arab Emirates as the coronavirus rages.

Shares in Abu Dhabi Commercial Bank dropped 4.3 per cent on Sunday, extending its losing streak to a seventh day.

Other UAE companies with exposure to NMC:

* Ajman Bank has Dhs151.9m exposure to NMC

* Al-Salam Bank has $44m exposure to NMC

* Emaar Malls owed Dhs1.4m by UAE Exchange

* Emaar Malls holds post-dated checks from UAE Exchange at Dhs1.78m


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