Emirates Development Bank approves $1.12bn funding in first nine months of 2022

A sharp rise in financing increased lender's contribution to UAE's GDP to $708.45m during the period

Year-to-date, EDB has digitally on-boarded 1,377 customers through its digital business banking platform. Photo: EDB

Emirates Development Bank, the state-owned lender focused on financing companies in key industrial sectors, approved Dh4.4 billion ($1.12bn) in loans in the first nine months of the year, as it continues to support the UAE’s national economic agenda.

The bank’s lending for the nine months to the end of September increased almost sevenfold from the same period a year earlier. Loans approved during the July-September period jumped 59 per cent from the previous quarter, EDB said in a statement on Tuesday.

On aggregate, financing during the first nine months of the year boosted EDB’s contribution to the UAE's gross domestic product to Dh2.6bn, a more than 600 per cent increase compared with the same period in 2021.

“The impressive results of the first nine months of 2022 that EDB has yielded so far are a testament to the bank’s efforts in supporting the UAE’s economic diversification agenda, contributing to the UAE GDP and ultimately, building a more sustainable economic future for the UAE,” Dr Sultan Al Jaber, Minister of Industry and Advanced Technology, who is also chairman of EDB, said.

EDB plays a key role in supporting the national economic development agenda and is at the forefront of the government’s efforts to develop its non-oil economic and industrial base.

The lender provides direct and indirect financing to start-ups, small and medium enterprises and large corporates, sponsoring industrial projects across five priority sectors. These are: manufacturing, infrastructure, advanced technology, food security and health care.

During the first nine months of the year, EDB approved loans worth Dh1.29bn to SMEs, an 86 per cent rise from a year earlier. It comprised Dh806 million in direct financing and Dh485m in indirect financing through EDB’s credit guarantee scheme with partner commercial banks in the UAE.

The lender approved Dh3.1bn in loans for bigger companies during the nine-month period through its large corporate division, which supports UAE’s national priority sectors and projects, including data centres, water desalination, transport, hospitals, manufacturers and specialised logistics schemes.

EDB, founded in 2011 through the merger of Emirates Industrial Bank and Real Estate Bank, launched its new strategy in March 2021. It has set aside Dh30bn to facilitate direct and indirect lending to more than 13,500 companies in priority sectors by 2025.

In June, EDB chief executive Ahmed Al Naqbi said that the lender was targeting Dh5bn in aggregate financing by the end of 2022, up from about Dh2bn it had lent in the first six months of the year.

EDB plans to top the Dh5bn financing level next year and in 2024, as it pushes forward with its target of Dh30bn in total funding before the end of 2025, Mr Al Naqbi told The National at the time.

The lender works with state entities, including the Ministry of Industry and Advanced Technology, and free zones such as Dubai Industrial City and Jebel Ali Free Zone in Dubai and Khalifa Industrial Zone in Abu Dhabi to provide financing to their clients.

Last year, the UAE launched its industrial Operation 300bn strategy to position the Arab world’s second-largest economy as a global industrial hub by 2031. The 10-year plan focuses on increasing the industrial sector's contribution to the country's GDP from Dh133bn in 2021 to Dh300bn in 2031.

EDB is at the heart of the strategy that focuses on boosting production in 11 priority sectors, supporting the growth of national industries, attracting foreign investment and ensuring availability of dedicated financing for local industrial companies.

The bank plans to allocate Dh7bn financing to the manufacturing sector in the next five years. The advanced technology sector is expected to receive Dh5bn in funding, infrastructure Dh8bn, health care Dh2.5bn and the agricultural technology and food security sector companies are projected to receive another Dh2.5bn, Mr Al Naqbi said in June.

Delegates attend a session on the second day of the Make it in the Emirates forum in Abu Dhabi. All photos: Victor Besa / The National

Dr Sultan Al Jaber, Minister of Industry and Advanced Technology, and managing director and group chief executive of Adnoc, addresses delegates.

Ahmed Al Bastaki is the chief commercial officer of Rafed, which is part of Pure Health Group.

Ruba Nemer, manager of Adnoc's regulatory affairs department, addresses delegates. Victor Besa / The National

Ameed Al-Ashqar from Adnoc during the energy company's session on procurement opportunities.

Delegates attend a session on the second day of the Make it in the Emirates forum.

The UAE has already launched the National In-Country Value programme that aims to boost the private sector's participation in the economy, diversify output and localise critical parts of the supply chain.

Omar Al Suwaidi, Undersecretary at the Ministry of Industry and Advanced Technology, addresses delegates.

Rola Abu Manneh, chief executive of Standard Chartered Bank UAE.

Humaid bin Salem, secretary general of the Abu Dhabi Chamber of Commerce and Industry.

The Mubadala stand at the forum.

Abdulmunim Al Kindy, executive director of people, technology and corporate support at Adnoc.

Ahmed Al Naqbi, chief executive of Emirates Development Bank.

Sameh Al Qubaisi, director general of economic affairs at the Abu Dhabi Department of Economic Development.

The Adnoc stand at the forum.

Ismail Abdulla, chief executive of Strata.

Saud Abu Alshawareb, managing director of the Dubai Industrial City.

Dr Al Jaber said the UAE had emerged from the Covid-19 pandemic stronger, helped by its strategy to further strengthen its industrial sector to boost economic resilience.

Delegates were told that more than $11bn has been redirected into the national economy through the National In-Country Value programme.

Omar Al Suwaidi, Undersecretary of the Ministry of Industry and Advanced Technology, addresses delegates.

Mohammed Al Shorafa, left, chairman of the Abu Dhabi Department of Economic Development.

Mr Al Shorafa, left, and Ali Al Sayegh, vice president of internal communications and employee engagement at Adnoc, during a discussion at the forum.

Dr Al Jaber said there are more than 300 products available in 11 priority sectors for local manufacturers.

As part of its commitment to foster home-grown innovation, EDB provided Dh3bn in financing to Emirati-owned businesses, it said.

The sharp rise in EDB’s lending programmes was largely underpinned by the continuous enhancement of its digital capabilities.

Year-to-date, EDB has digitally on-boarded 1,377 customers through its digital business banking platform, it said.

The lender, which aims to create 25,000 jobs in the next five years, has launched its digital lending programme in partnership with Beehive — a peer-to-peer platform — which approves loans of up to Dh5m within five days for SMEs.

“Looking ahead, we remain focused on continuing to provide financial support at attractive financing rates to all our customers,” Mr Al Naqbi said.

“EDB is well positioned to further progress our developmental strategy, scale up the bank’s financing activities across our five strategic sectors, and ultimately increase our economic impact across the nation.”