ABU DHABI: The United Arab Emirates' credit bureau has begun covering retail customers and plans to extend its work to companies next year, its chief executive said on Wednesday.
The much-delayed Al Etihad Credit Bureau now has financial information on 2.8 million individuals or 97 percent of the total population with a credit history, Marwan Lutfi said.
The UAE government is seeking to strengthen the banking system against bad debt. Until now, banks have often been unable to access data on consumers at other financial institutions when making lending decisions, meaning borrowers could take on huge debts with multiple lenders without any of them knowing.
Together with tougher mortgage lending rules and caps on lending to government-linked companies, the credit bureau is one of several tools aimed at guarding against a repeat of the crisis that paralyzed the financial system in 2009 and 2010. "The credit reports will play a key role in helping banks and financial institutions to assess risk accurately, enabling them to make informed lending decisions and lower lending risks," Lutfi told reporters at the Abu Dhabi headquarters.
The bureau had previously set the end of the first quarter of 2014 as the deadline for starting operations but the plan was delayed due to inaccurate information or errors in the consumer credit data being submitted by banks.
About 99 percent of the required correct data on consumers had now been supplied by banks, Lutfi said. To date, 43 banks and financial institutions had submitted their customers' credit data and 29 of them had subscribed to the bureau's credit reporting services. In total, 51 banks operate in the UAE.
Starting next year, the bureau will also offer credit reports on all companies operating in the UAE, including any details of bounced checks.
Some banks are unsure about how much difference it will make to their lending practices.
"If we would have been getting it this wrong for this long then we would have been suffering much larger credit losses than we have," said the chief executive of one lender.
UAE credit bureau starts retail operations
UAE credit bureau starts retail operations
Closing Bell: Saudi main index climbs to 10,485
RIYADH: Saudi Arabia’s Tadawul All Share Index edged up on Sunday, gaining 34.32 points, or 0.33 percent, to close at 10,484.59.
The total trading turnover of the benchmark index stood at SR2.59 billion ($690 million), with 168 listed stocks advancing and 87 declining.
The Kingdom’s parallel market Nomu also gained 100.37 points to close at 23,454.65.
The MSCI Tadawul Index advanced by 0.13 points to 1,377.44.
The best-performing stock on the main market was Nama Chemicals Co., whose share price increased by 9.98 percent to SR22.38.
The share price of Al Masar Al Shamil Education Co. rose by 9.15 percent to SR23.85.
Saudi Paper Manufacturing Co. also saw its stock price climb by 8.42 percent to SR57.95.
Conversely, the share price of Canadian Medical Center Co. dropped by 6.37 percent to SR6.03.
The stock price of Kingdom Holding Co. also declined by 3.16 percent to SR8.28.
In the parallel market, Alfakhera for Mens Tailoring Co. was the top performer, with its share price advancing by 16.40 percent to SR8.80.
On the announcements front, Theeb Rent a Car Co. said it had signed a long-term vehicle leasing services contract valued at SR110.4 million with Hungerstation Co.
Under the deal, Theeb will lease 2,000 vehicles to HungerStation for a period of four years starting from 2026, according to a Tadawul statement.
The statement added that the vehicles will be delivered in batches within the first six months from the contract start date, taking into consideration global logistical circumstances and procedures beyond the control of both the agents and the company.
The contract is expected to have a positive impact on the company’s financials from the first quarter of 2026.
The share price of Theeb Rent a Car Co. declined by 0.79 percent to SR37.80.
