The Egyptian unit of UAE-based Abu Dhabi Islamic Bank (ADIB) recently acquired a license from Egypt’s Financial Regulatory Authority to operate its subsidiary ADI Microfinance. The microfinance institution will offer loans of up to EGP 220,000 (USD 7,100) that follow Islamic law – also known as Shariah – which prohibits traditional interest charges. Instead, lenders often use profit-sharing arrangements. ADI Microfinance reportedly has paid-up capital of EGP 25 million (USD 810,000) and authorized capital of four times that amount.
ADIB Egypt and its subsidiaries provide a range of Shariah-compliant financial services to individuals and companies, including savings, loans, real estate leasing and risk management services. The company took its present form in 2013, when ADIB acquired and renamed the National Development Bank, which had been founded in Egypt in 1974. ADIB Egypt has 70 branches and reported quarterly return on assets of 0.80 percent and return on equity of 9.5 percent as of March 2023.
ADIB was founded in 1997 and reported 12-month return on equity of 24 percent for 2022, ending the year with total assets of AED 168 billion (USD 46 billion). ADIB has headquarters in the UAE and operations in Saudi Arabia, Iraq, Sudan, Egypt and Qatar.
By James Stevenson, Research Associate
Sources and Additional Resources
Zawya article
https://www.zawya.com/en/economy/north-africa/adib-egypt-to-launch-egypts-1st-sharia-compliant-microfinance-firm-kbvsddd0
ADIB Egypt homepage
https://www.adib.eg/
ADIB Egypt report for the first quarter of 2023
https://www.adib.eg/media/644552/_ADIBEG_Financial_Consolidated_Q1_31-03-2023.pdf
ADIB Egypt annual report
https://www.adib.eg/media/172834/ADIBEG_Annual%20Report_English_2020.pdf
ADIB annual report
https://www.adib.ae/en/siteassets/annual%20reports/annual_report_2022_en.pdf
ADIB homepage
https://www.adib.ae/
Financial Regulatory Authority homepage
https://fra.gov.eg/
Previous MicroCapital article on Shariah-compliant finance
https://www.microcapital.org/microcapital-brief-islamic-finance-advisory-assurance-services-mercy-corps-to-promote-shariah-financial-products-in-ethiopia/
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