Dividend doubts hit Abu Dhabi Islamic Bank

Markets Wrap: Abu Dhabi Islamic Bank fell the most in eight months on speculation the UAE's second-biggest Sharia-compliant lender may recommend a full-year dividend that is below expectations.

Abu Dhabi Islamic Bank yesterday fell 3.1 per cent to Dh3.08 a share, the biggest drop since April 12. Ryan Carter / The National

Abu Dhabi Islamic Bank (ADIB) fell the most in eight months on speculation the UAE's second-biggest Sharia-compliant lender may recommend a full-year dividend that is below expectations.

The stock retreated 3.1 per cent, the biggest drop since April 12, to Dh3.08 at the close in the capital. About 2.56 million shares were traded yesterday, more than 13 times the three-month daily average. ADIB was the biggest decliner in percentage terms on the benchmark ADX General Index, which rose less than 0.1 per cent.

The lender last month raised US$1 billion from the sale of Tier-1 perpetual sukuk, which do not mature, paying a coupon of 6.375 per cent. The notes, which can be treated as equity, come as ADIB seeks to boost its Tier-1 capital ratio to more than 15 per cent from 13.7 per cent at the end of September as part of plans to expand lending. The lender paid a Dh0.2442 cash dividend for 2011, data compiled by Bloomberg shows.

By the close, Abu Dhabi's measure ticked up 0.06 per cent to 2,612.80 points.

Bluechips helped Dubai's index to rise 0.1 per cent to a close of 1,591.5 points.

Emaar Properties and Air Arabia gained 0.5 per cent and 1.2 per cent respectively. Builder Arabtec climbed 1.3 per cent.

Elsewhere, Kuwait's benchmark edged up 0.02 per cent to 5,986.8 points, a nine-week high.

Qatar's bourse marked its biggest one-day gain in three months on a technical breakout.

Industries Qatar gained 1.1 per cent and Qatar Electricity and Water climbed 0.9 per cent. Of the 20 stocks on the main index, 18 advanced.

Doha's index rose 0.7 per cent to 8,407.1 points, its largest daily gain since September 12.

* with agencies