UAE Banks Federation CEOs Council Examine Financial Reporting Standards
The CEO Advisory Council of the UAE Banks Federation, the professional body representing 49 banks in the UAE,has held today (May 24, 2016) its second regular meeting for this year, in Abu Dhabi. Chaired by the HE Abdulaziz Al Ghurair, Chairman of the Federation, the meeting reviewed progress made on the “Modus Operandi”, the initiative recently launched by UBF to rescue and support SMEs and corporates indebt. CEOs also reviewed progress made on adoption of the latest iteration of International Financial Reporting Standards (IFRS 9) governing accounting standards to be applied on a globally consistent basis.
Since it was formally launched in March, the Federation’s initiative for SMEs and Corporates, called “Modus Operandi”, has been activated on a number of occasions when a borrower has met the required criteria to allow its lending banks to collaborate on finding new ways to help it to meet its financial commitments. The CEO Advisory Council was given an update on cases so far handled, and reaffirmed its full commitment to the scheme by reviewing results and progress on a regular basis.
During the meeting, Jamal Saleh, (Deputy General Manager - Head of Risk Management, Commercial Bank of Dubai and a member of the Federation’s risk management committee) presented a progress report on IFRS9 which was introduced in 2014, and provided an update on discussions with the UAE Central Bank on the proposed Risk Standards and Guidelines. IFRS9 includes a logical model for classification and measurement, a single forward-looking 'expected loss' impairment model and a substantially reformed approach to hedge accounting. IFRS 9 will be effective for annual periods beginning on or after 1 January 2018.
Another topic on the Council’s agenda was the Emirates Interbank Offered Rate (“EIBOR”). Salman Amjad (Director Funding, Mashreqbank) and a member of Financial Markets Committee, presented a summary of the proposals being discussed among committee members on local market practices relating to EIBOR submissions to adapt best practices from other leading international market .
His Excellency AbdulAziz Al Ghurair, Chairman of the UAE Banks Federation, commented: “UBF SME initiative has succeeded to contain the problem facing defaulted SMEs, and the aim of the scheme will remain to do everything we can to assist those SMEs and corporates experiencing difficulties to survive while ensuring the continuing high quality of our assets as lenders.
H.E added: “UAE banks are generally in very good shape in relation to meeting and indeed exceeding international standards of capital adequacy and preparedness for the introduction of Basle 3 in 2018. But as we move towards its introduction, the economic climate fluctuates and further changes are made to the standards to be met, we need to continue to monitor the compliance of all our members and seek to address any issues as soon as they arise.”
During the meeting HE Al Ghurair also presented an award to Mr. Tirad Al Mahmoud, CEO of ADIB, in recognition of his valuable contribution at the conclusion of his 3 year term as the Federation’s representative at the Union of Arab Banks, and his contribution in the mobile wallet project.
The meeting concluded with agreement on the theme for the 2016 Middle East Banking Forum, the Federation’s annual conference, to be held in Abu Dhabi in November. This year the theme will be “Transforming the Customer Experience”, with sub-topics to include de-risking, cyber security, and fraud prevention.
