Dubai Islamic Bank announced on the Nasdaq Dubai today that "like other national banks", it had signed a Wakala Agreement with the UAE Ministry of Finance. This is part of the UAE Government's program of providing funding to banks to strengthen their financial resources. As with the other transactions, the UAE MOF may convert the Wakala Deposit and any accrued but unpaid profit distributions (interest in a conventional financing) to equity in the Bank.
Two intriguing things from this announcement:
- The agreement was signed on 31 December 2009. Yet the announcement was only made today 7 February.
- Apparently, the amount of the Wakala Deposit is a minor detail which need not be disclosed. At least at this point.
The date of the agreement (just in time for 2009 financials) suggests a pressing need at DIB for additional funds of a capital nature. AA wonders if the deal was actually signed on 31 December 2009 or if it was signed "as of 31 December 2009". In the latter case, it may have been signed sometime after 31 December 2009. And that might explain that the apparent late disclosure was not late after all.
DIB's Board will meet on 10 February to discuss the fiscal 2009 financials, perhaps another sign that ducks have only recently been lined up, including this one.
And then again it may just be a case that disclosure standards differ from those AA is familiar with.
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