UAE’s Gulf Finance Corp to raise up to $163 mln syndicated loan
Banks and financing companies were facing pressure due to the plunge in oil prices since last year
Gulf Finance Corp, a wholly owned unit of Dubai’s Shuaa Capital, plans to raise up to 600 million dirhams ($163 million) in syndicated loans this year, its chief executive said on Tuesday.
The company will tap the loan market between the third and fourth quarters, and may raise between 200 million and 600 million dirhams, David Hunt told Reuters on the sidelines of a conference.
Gulf Finance provides finance to small and mid-sized firms in the United Arab Emirates. Hunt said banks and financing companies were facing pressure due to the plunge in oil prices since last year, which had dampened government and commercial appetite for fresh credit.
“It’s tough. I think you’ll find more and more banks are looking at the SME sector as a way of expanding their business with oil prices having an effect on government spending.
“Dubai has lost a bit of momentum at the moment. It’s slowed down a bit. I expect that to pick up towards the end of the year as projects come on stream for Expo 2020,” Hunt added, referring to the emirate’s preparations to host the world’s fair five years from now.
Gulf Finance obtained a 500 million dirham syndicated loan last November to support its expansion. The combined loan book of its UAE and Saudi Arabian operations totaled 908 million dirhams at the end of March and the company expects to reach 1 billion dirhams by the end of 2015, Hunt said.
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