dunia Annual Report FY 2013

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D U N I A A N N U A L

R E P O R T

S T R AT O SS O A R I N G H E I G H T S

noun1. the region of the upper atmosphere extending upward from the tropopause to about

30 miles (50km) above the earth, characterized by little vertical change in temperature.2. (formerly) all of the earth's atmosphere lying outside the troposphere.3. any great height or degree, as the highest point of a graded scale.

s t r a t · o · s p h e r e[strat-uh-sfeer]

S T R ATO S At dunia we have always had great admiration for individuals and organizations that have achieved great things. We celebrate success. We promote the concept of reaching forever higher, to achieve more. We see these attributes in some of the world’s greatest entrepreneurs and inventors – from those who fi rst took us in to space to today’s business leaders who are defi ning a new era of space tourism.

We believe that the only way to achieve greatness, to carve out new paths and make new discoveries is to think the unthinkable. To look upwards and outwards to farther horizons.

Man has only ever made great breakthroughs by looking beyond accepted wisdom, by challenging the status quo. Visionaries, insurgents and those who think differently – these are the people and businesses that shape our futures. We now have man-made technologies on planets around our solar system and within our lifetime, private business will have sent man to Mars. Such moves require bold ambition, creativity and above all ideas: ideas without barriers lead to new frontiers.

After fi ve remarkable years, we at dunia believe that we have achieved great things by doing what many – at the time - would have considered unwise. We created a new model for delivering fi nancial services that placed the customer at the very heart of the business. We built a business with a commitment to empowering people, achieving success and enriching their lives. We knew from the outset that we had a unique, bold offering that was based on vision and innovation, that chose to drill down as deeply as possible into the customer experience in a way that had never been done before. Our insurgent mentality – our belief in challenging the status quo – has taken the Company, its stakeholders and customers to greater heights.

These pasts fi ve years have been remarkable, our rise meteoric. As we look ahead, we look up, towards the stratosphere and we look forward to reaching even greater heights. There is nothing that cannot be achieved without vision.

6Annual Report 2013Annual Report 20135

CHAIRMAN’S MESSAGE 8

CEO’S MESSAGE 10

SHAREHOLDERS 14

BOARD OF DIRECTORS 16

MANAGEMENT TEAM 20

LAUNCHING INTO ORBIT

L IFT ING OFF TO NEW HEIGHTS 34

THE DUNIA JOURNEY 38

BREAKING BARRIERS

GOING THE EXTRA MILE FOR CUSTOMERS 44

HELPING OUR CUSTOMERS STAY AHEAD 50

DELIVERING OUTSTANDING CUSTOMER SERVICE 56

EMPOWERING CUSTOMERS THROUGH TECHNOLOGY 60

SETTING NEW STANDARDS

SERVING THE NATION 68

DEVELOPING WORLD CLASS TALENT 72

SHAPING FUTURE LEADERS 86

GROWING STEADILY

WORLD CLASS GOVERNANCE 92

PERFORMING WITH EXCELLENCE 100

CARING WITH PASSION 101

LEADERSHIP THROUGH INFLUENCE 104

SOARING TO NEW HEIGHTS

F INANCIAL TRENDS 110

AUDITED FINANCIALS 122

CO N T E N T S


Ambition. It is not about fi nding yourself but about creating yourself. At dunia, we aim for the stratosphere, that is the absolute best.

Salem Rashid Al NoaimiChairman

The success of any company rests on its absolute commitment to being the best in what it does and serving customers passionately and with excellence. It is that passion and desire within dunia that keeps us at the forefront of innovation, and empowers us to keep delivering with creativity and excellence, as we shoot for the skies.

Rajeev KakarManaging Director & CEO



C H A I R M A N ' S M E S S A G EC H A I R M A N ' S M E S S A G E

O N A N U P W A R D

T R A J E C T O R Y

It is with great pride that I look back over our achievements in 2013. This was dunia’s fi fth year of operations, and one that I feel should rightly be seen as a 'landmark’ year for us.

The company grew exponentially year on year on every key measure - customer acquisition, satisfaction and loyalty, revenue, net income and the key effi ciency ratios of return on assets and on equity.

2013 was a stellar year in which we demonstrated our earnings potential even more strongly than in previous years. We continued to offer best- in-class services that enrich the lives of our customers. Our focus on innovation, excellence, teamwork, and an unparalleled commitment to customer satisfaction is what sets us apart. These values help us deliver long-term, sustainable growth and greater shareholder value. We are strongly committed to serving our customers with excellence in the years ahead.

I would like to thank the entire team at dunia for their contribution to our shared belief in achieving superior service and performance in everything we do. We will continue to strive towards delivering strongly against the expectations of all our stakeholders – our customers, our regulators, our shareholders and the broader community for their continued support and confi dence.

Yours sincerely,




C E O ' S M E S S A G EC E O ' S M E S S A G E

R E A C H I N G F O R

T H E S TA R S

The year 2013 heralded an exciting new chapter for dunia. As the company grew throughout the year, reaching new milestones, so too did the UAE and its economy. Major investments were announced in Dubai and Abu Dhabi to support the building of new infrastructure, from public transport to hospitals, airports and road links. These announcements came against a backdrop of annual GDP growth of 4% coupled with a continued rise in the non-oil sectors of fi nancial services and tourism. These incredibly positive economic indicators demonstrate that the UAE is growing in a sustainable manner, diversifying its economy and gearing up well in advance of Expo 2020 and the economic successes that are set to come.

Since 2008, the UAE has weathered the global economic crisis better than most. It was during those dark days that dunia was launched - at the very moment that the global fi nancial crisis commenced. Since then, dunia has mirrored the nation's return to solvency, growth and a strong balance sheet. Within three years we broke even and since then have enjoyed YOY double-digit growth. This steady, upward trend is seen in revenues, profi t margins and an organically growing customer base. We believe that the true key to building a successful business is one that puts the customer fi rst. From the outset, this belief has served us well. Achieving an increase of 61% on our net income in 2013 came through our commitment to delivering impeccable products and services. Acquiring and retaining customers is our primary motivator and this approach is non-negotiable: deep-rooted personal relationships with each and every customer. Much like the UAE’s unwavering focus on building high value services in its endeavor to achieve a strong and diversifi ed economy, so too has dunia focused on what matters most: “Relentless focus on customers, on dimensions of service, innovation, products, sustainability, and quality of experience.”

The incredibly positive impact of dunia’s customer-centric philosophy and sustainable approach to growth is refl ected in a 21% increase in total customer numbers over the course of 2013. The trust that those customers have in dunia as a well-leveraged, trusted fi nancial institution saw customer deposits soar to more than AED 500 million, representing a 24% increase vs. 2012. Trust is our most important asset. For us, it means going back to basics and working in a way that people understand and trust. We have built a strong, resilient business that is well leveraged and supported by strong deposits and customer assets. Total customer assets in 2013 surpassed the AED 1 billion mark for the fi rst time; a rise of 35% on the previous year. This is testament to the commitment that the entire dunia team has to working ethically and honestly: putting our customers’ needs at the very center of everything we do.

Over the year we have launched a number of new initiatives, products and services that offer unparalleled choice and value to our customers across their various needs – transaction, savings, borrowing and protection. These include the launch of an industry-fi rst credit card, offering customers 3% unlimited cash-back on all spend, loan against property, car fl eet fi nancing and many more solutions. Innovation of our products and services is a continuous effort at dunia, while executing with excellence.


Gaining our first standalone credit viability rating of BB- from Fitch is testament to the way in which we do business. Our continuously improving financial performance, prudent management of risk and sound balance sheet are now recognized in a way that should provide customers and other stakeholders with great confi dence. Our commitment to sustainable business practices also goes hand-in-hand with delivering better fi nancial returns and value to shareholders over the long term, allowing us to capture new opportunities in the marketplace, backed by a strong and growing capital base.

In 2013 we continued to work hard towards maintaining a business model that is predictable, profitable, and sustainable. We have achieved this through growing a robust equity base with a low debt-to-equity ratio. This allows not only for a strong balance sheet but also for continued growth in customer assets and earnings. These measures have enabled us to build a stronger loss-absorption capacity, insulating the company and all of its shareholders and customers from risk. This attitude refl ects solid, common sense business and – crucially – our commitment to looking after the interests of our customers. Gaining our customers’ trust that their deposits are safe is a central focus and will remain so as we move forward. This strength is underpinned by the continued development of a diverse portfolio of customer assets and deposits, with positively matching tenure durations that help us to mitigate risk and plan for the long term.

MILESTONES AND ACHIEVEMENTS The successes enjoyed by the company were myriad in 2013, a year that saw us reach 34 consecutive months of top-line growth and profitability. Building a strong, informed and empowered work force has been central to our business strategy. I am personally incredibly passionate about training, development and nurturing talent. It is only through vsourcing and retaining the world’s fi nest professionals that we have been able to defy market expectations by rising so quickly and sustainably. We continued to challenge the status quo. I am a vocal proponent of doing things differently, for the right reasons.

Everything we do is focused on delivering a service that is truly and demonstrably different, providing customers with extremely personalised

services. Doing things differently and challenging the status quo enables us to deliver greater value to customers and all other stakeholders.

HIGHLIGHTS IN 2013FINANCIAL GOALSAt dunia, we rigorously monitor & manage the dunia portfolio to deliver and exceed on key top-line & bottom line targets. We monitor and manage the balance sheet for predictability, profi tability & sustainability.

• FY 2013 revenues of AED 354 million, up 26% compared to FY 2012

• FY 2013 net income of AED 118 million, up 61% compared to FY 2012

• FY 2013 dividend of AED 17.6 million, up 100% on FY 2012, enhancing shareholder value

• We paid dividends for the third consecutive year and for the fi rst time we paid an interim dividend

• Total customer number increased 21%year on year, reaching 138 thousand

• Customer assets surpassed AED 1 billion for the fi rst time, up 35% year on year

• Customer deposits crossed AED 500 million, up 24% against prior year

FRANCHISE GOALS• dunia was assigned a healthy

Viability Rating of ‘BB-‘ and a standalone Long-term Issuer Default Rating of 'BB-' by Fitch Ratings, on par with most leading local & regional banks, on a similar standalone viability rating basis

• We continued to deliver on rapid expansion initiatives through deepening existing relationships, as well as expanding into new customer segments with a strong ethnic focus

RISK MANAGEMENTAt dunia we believe in strengthening operational risk management capabilities to support business growth and mitigate risk. We also focus on ensuring robust liquidity management to ensure sustainability & optimal shareholder return. It is this disciplined approach that has allowed us to predictably and sustainably deliver healthy RAY of 27.8%, ROE of 28.9%, and loss absorption capacity of 2.4x, while ensuring low levels of “liquidity risk, concentration risk, and leverage risk”.

PROCESS CONTROL AND GOVERNANCE• We ensure optimal deployment of IT

capabilities & architecture in line with

business needs, new capabilities & evolving technology

• We focus on delivering service excellence in turn leading to customer delight

• We endeavor to maintain a robust control environment at all times

PEOPLE• It is my belief that our consistently

reliable and strong performance at dunia is based on the strength of a focused, passionate and energetic team

• We built a strong talent pool and continue to leverage skills & knowledge base for business excellence & sustainability and who have the ability to create and innovate, and then execute ideas with excellence to achieve results – with high standards of performance and personal integrity. We therefore invest strongly in attracting good people, and then engaging them to deliver, training them to perform stronger while developing them to enhance their potential

• Our talent pool grew to a well-trained team of over 900 employees

• The company’s diverse workforce is now made up of professionals from 31 nations around the world

• Of those who have been with dunia since its inception, more than 70% have been sent on external leadership training development programs

• As part of our commitment to building a strong Emirati workforce, we focused even more on campus engagements to recruit the best and added new senior and seasoned Emirati talent to fuel our future ambitions

• Our Management Associate program led to the hiring of several new employees

• Refl ecting our commitment to providing real-time responses to each and every single customer enquiry, we invested heavily in our call centre capabilities in 2013, which grew by 11% employees

• Our Talent Management Program is designed to keep developing and growing our talent for higher responsibilities and accountability through job rotation, stretch assignments, team challenges, continuous mentoring, overseas assignments and nomination to leadership development programs offered by leading universities

STRATEGIC INITIATIVES• We focused even more on

institutionalization of dunia through enhancement in policy framework, governance standards and overall holding structure and receiving an external credit rating

• Our internal enterprise technologies were upgraded, further streamlining our customer engagement processes and adding value to the customer experience

• We are amongst the fi rst in the UAE to introduce chip and pin technology in our card system, to offer greater customer safety and protection, and to increase and enhance our payment services technology capabilities

• The use of Strategic Analytics has always been a central part of the customer-centric approach. In 2013 the company increased its use of ‘big data’ .This move allows us to develop new products and services that are relevant

RECOGNITION• We were issued with a viability

rating of BB- and a standalone long-term issuer default rating of BB- by Fitch Rating, testament to our policies of strong governance, risk management, regulatory compliance and the company’s consistently strong fi nancial performance

• In 2013 we continued to build relationships with partners and other key fi nancial services players in order to push forward an agenda of consumer protection and setting standards

• We were recognised by the new Etihad Credit Bureau as one of the nation’s top 30 fi nancial institutions

• In 2013 we have been awarded one of the strongest satisfaction ratings from external regulatory audits

• Recognised as one of the top 100 emerging global companies by top tier consultants

• Recognized as being 4th in UAE for outstanding service by Gulf News Service Honor Roll

• dunia’s Annual Report for FY 2012 was awarded a Platinum Award by LACP

• dunia’s Annual Report for FY 2012 was recognized amongst Mubadala entities for its transparency and comprehensiveness

• dunia was recognized yet again through a second case study written by Singapore Management University on our unique credit approach

ASPIRING TO GREATER HEIGHTSWe are mindful of the fact that the market

place is becoming more competitive and as the global economy continues to correct itself and liquidity improves, there will be a greater demand for capital which will need to be sourced from a range of investors and geographies. This challenge is, however, welcomed. We know that the only way to respond to a changing climate is to continue to innovate, and invest. and to be - naturally selected - as a recipient of such capital by becoming the most attractive value creating opportunity to invest in.

Innovation comes through personal empowerment and that means investing even more not only in our products, systems, and processes, but also in training, mentoring and nurturing all employees. We are absolutely committed to investing in our people as we move ahead as talent is the key differentiator.

GROWING SUSTAINABLYThe best run companies are those that embrace the ‘triple bottom line’. This measures not only profi ts but also the impact that our activities have on people and the planet. The basis for this belief is straightforward: every company has a responsibility not only to its shareholders and employees but also to people and the planet.

PEOPLE : Every operational decision taken at dunia is assessed against the impact that it may have on the people the company and its actions touch upon: our staff, our shareholders and the wider community.

PROFIT : Profi tability enables all business to grow and create jobs, which is a major benefi t to society. Profi table organizations may also be less likely to cut corners and we believe that by being profi table we are able to invest in systems and processes that protect the business, protect jobs and safeguard the people and planet around us.

PLANET : We have implemented many green initiatives to help protect the environment. These include reducing our own ecological footprint trough compact branches, recycling, automation, waste reduction and the active promotion of energy saving tactics such as energy-effi cient lighting. In our world of limited resources, we have a responsibility to use them judiciously, while ensuring we replenish for the future.

REACHING NEW SUMMITS IN 2014Five years is often considered to be a milestone for new companies. Our

performance throughout this period – from inception to profi tability and beyond – has been consistently strong one that has set records, which has been recognized inherently.

We have a strong, robust balance sheet and a growing customer base. We have excellent governance policies benchmarked against global standards. We are confi dent that dunia is fundamentally strong, providing us with an enviable platform for growth and investment.

We are now at a point in our growth where we are able to leverage our capabilities to take us to the next level of performance. As we look ahead, we will focus on even more growth through scale and scope, and also through constant reinvention and enhancement of our core by transforming and enhancing our capabilities. Our business is rapidly growing by every measure, most notably ( and most importantly) our customer base.

REACHING THE STRATOSPHEREI am incredibly pleased with our progress so far: 2013 was a major milestone. I am, however, even more excited as we look ahead. I know that we are in a rare position: well leveraged, well run and staffed with some of the world’s most talented professionals. I am fully confi dent that 2014 will present us with many successes. New initiatives, products and services are well under way and I believe that 2014 will see us surpass expectations, rise above what has come before us and soar to even greater heights.

I wish to especially thank all our stakeholders who have partnered and supported us in this incredible journey thus far and as we continue setting new highs in the future. My personal special thanks to the Central Bank of the UAE as our regulators, our alliance partners, our service providers, our bankers, our shareholders, board members, our employees and their family members.

With my best personal regards,



D U N I A I S A P R I VAT E LY H E L D F I N A N C I A L S E R V I C E S C O M PA N Y L A U N C H E D

I N 2 0 0 8 . I T S S H A R E H O L D E R S A R E F U L L E R T O N F I N A N C I A L H O L D I N G S ,

M U B A D A L A , W A H A C A P I TA L A N D A . A . A L M O O S A E N T E R P R I S E S . T H E Y

B R I N G T O G E T H E R C O M B I N E D M U LT I - S E C T O R I N V E S T M E N T E X P E R T I S E .

S H A R E H O L D E R S

Fullerton Financial Holdings (FFH) invests in, and operates fi nancial institutions in emerging markets. We create shareholder value by differentiating through great people, disciplined development and execution of unique business models that focus on the mass market and SME customer segments. FFH is a wholly owned subsidiary of Temasek Holdings (Private) Limited, an investment company based in Singapore. As at 31 December 2012, FFH’s total assets stood at S$40.9 billion, and its portfolio includes investments in 11 fi nancial institutions located in 8 countries.

www.fullertonfi nancial.com

Established and owned by the Government of Abu Dhabi, the company’s strategy is built on the creation of partnerships and on long-term, capital-intensive investments that deliver strong fi nancial returns and tangible social benefi ts for the Emirate of Abu Dhabi, and that contribute to the growth and diversifi cation of its economy. Mubadala brings together and manages a multi-billion dollar portfolio of local, regional and international investments and partners with leading global organizations to operate businesses across a wide range of industry sectors. These include aerospace, energy, healthcare, information communications and technology, infrastructure, real estate and hospitality, and services ventures.

www.mubadala.ae

Waha Capital is an Abu Dhabi-based publicly listed investment company, whose aim is to deliver attractive and sustainable returns to its shareholders by deploying and managing capital in areas where the company sees opportunity and can add value. Waha Capital is active in Principal Investments, Capital Markets and Industrial Real Estate. The company’s portfolio consists of direct investments across a number of sectors which include aircraft leasing, healthcare, consumer fi nance, offshore oil & gas services, infrastructure and industrial real estate. Waha Capital operates at the heart of a strong business network in the United Arab Emirates and the broader Middle East region, and enjoys a close affi liation with some of Abu Dhabi's most prominent investment and fi nancial institutions. Waha Capital's institutional shareholders include Mubadala Development Company.

www.wahacapital.ae

A.A. AL MOOSA ENTERPRISES LLC, also more familiarly known as the Arenco Group, is one of the leading and prominent local business groups in the UAE, with business interests spanning real estate, hotels, architectural design, manufacturing, services and trading. Set up in 1971, the group has its corporate headquarters in Dubai, with business interests in all emirates and beyond. The group continues to rapidly grow in its various businesses as a service oriented group and looks forward to its diversifi cation into fi nancial services through its interest in Dunia Finance LLC.

www.aaagroup.com


Salem Al Noaimi Rajeev Kakar Dr. Ahmed Al-Mutawa Gan Chee Yen Mansour Al Mulla

B O A R D O F D I R E C T O R S


Rajeev is the Founder Managing Director and CEO of dunia. He is also concurrently the EVP and Regional CEO for CEEMEA region for Fullerton Financial Holdings (Fullerton), a 100% owned subsidiary of Temasek Holdings, in Singapore. In his additional role as the EVP and Senior Management Committee Member at Fullerton, Rajeev also heads the Consumer Banking businesses globally for all its Bank and Financial Services Investments and Holdings. Rajeev has over 27 years of experience in banking. He joined Fullerton in 2006, and prior to that worked with Citibank N.A. for two decades, based in various geographies, between 1987 and 2006 - and in his last role was the Regional Head and CEO for Citibank's Global Consumer Bank, managing the Turkey, Middle East and Africa region. Forbes Middle East has consistently recognized Rajeev as being part of the Top Indian Leaders in the UAE in 2014 and 2013. For the last four years from 2010-2013, Rajeev has been annually recognized in the Arabian Business' "GCC Power List India Top 100" which recognizes Top Indians in the region for their achievements. In 2009, Rajeev received ITP's "CEO of the Year" Award for Financial Services in the Middle East. Rajeev has completed his Bachelor of Technology in Mechanical Engineering from the Indian Institute of Technology (IIT) in Delhi and his MBA in Marketing and Finance from the Indian Institute of Management (IIM) in Ahmedabad. Rajeev is currently a member of the Global Management Board of Fullerton in Singapore. Additionally, Rajeev is the Chairman on the Board of “Fullerton Securities & Wealth Advisors Ltd” (FSWA) and the Director on the Board of “Fullerton India Credit Company Ltd” (FICC), headquartered in India. Between 2010- 2013, Rajeev was a Commissioner on the Board of Commissioners for Adira Dinamika Multi Finance Tbk, in Indonesia. Between July 2004 and February 2006, Rajeev was a member on the CEMEA Board of Visa International. He is also a member of the Global Advisory Board for the University of Chicago Booth School of Business since 2009 and a member of the Industry Advisory Board of SP Jain School of Global Management since 2011. He is also a member of the Indian Institute of Management (Pan IIM Network) Alumni Board in the UAE since 2011.

Gan Chee Yen is a Director on the dunia Board and the CEO of Fullerton Financial Holdings (FFH) in Singapore. Prior to his current appointment, Gan was the Co-Chief Investment Offi cer and Senior Managing Director, Special Projects at Temasek International. He joined Temasek in May 2003 as CFO and has since served in various investments roles as a member of the senior management team in Temasek. The investment clusters he has led included the Financial Industry portfolio and the Transportation and Logistics portfolio, before he took on the role of Co-CIO of Temasek where he anchored several successful investments. He has also recently completed his stint as Head of China market. Gan has served on the boards of several companies including Neptune Orient Line, a global shipping company and has been a board member of FFH and a board commissioner of Bank Danamon since 2003. He is a member of the Institute of Singapore Chartered Accountants. He received his Bachelor of Accountancy from the National University of Singapore. Gan has also attended Harvard's Program for Management Development in September 2001.

Dr. Ahmed Khalil Al-Mutawa is a respectable academic professional, as he progressed in his academic career since he held his B.A. in Economics from Cairo University in 1978, M.A. in Economics from University of North Carolina in 1981, and Ph.D. in Economics, Georgetown University, Washington, D.C. in 1991. As a professor, he held the position of the Chairman of the Economics Department, and in 1997 became Deputy Vice Chancellor for Planning (DVCP), UAE University. Dr. Al-Mutawa had occupied many important business positions, among them: Executive Director, Al-Mustaqbal Economic & Strategic Consultations; Strategic Development Director at Maritime & Mercantile International; and the Secretary General of Gulf Organization for Industrial Consulting (GOIC); the CEO of Khalifa Fund for Enterprise Development; and currently the Executive Chairman of gfh Capital at DIFC. Dr. Al-Mutawa has been a member of many Associations, Organizations and several Boards of Directors on both local and international levels. He won the award for "Industry CEO of the Year 2005”. He has several international publications on economic and strategic matters.

Salem Rashid Al Noaimi is the Chief Executive Offi cer and Managing Director of Waha Capital PJSC. Waha Capital is an Abu Dhabi-based and ADX-listed investment company with interests in various sectors, which currently include aircraft leasing, fi nancial services, healthcare services, offshore oil and gas services and real estate development. Mr. Al Noaimi is responsible for leading the company’s overall diversifi cation and growth strategy across its business lines. His responsibilities include expansion through acquisitions, organic growth and the launch of new businesses, individually or in partnership with leading regional and global fi rms. He also guides Waha Capital’s contribution to Abu Dhabi’s economic diversifi cation and industrial expansion by ensuring the company focuses on priority sectors that will add signifi cant value to the local economy. Mr. Al Noaimi has signifi cant professional and executive experience in both the private and public sectors, including an extensive background in investment banking. He joined Waha Capital in 2004 (when it was known as Oasis International Leasing Co.) and has served as the company's CEO over the past 5 years. Previous roles included Deputy CEO of Waha Capital and CEO of Waha Leasing. In addition to his roles with Waha Capital, Mr. Al Noaimi has held various positions at Dubai Islamic Bank, the UAE Central Bank, the Abu Dhabi Fund for Development, and Kraft Foods. He chairs and sits on the board of a number of companies, including New-York Listed Aercap, Abu Dhabi Ship Building, Dunia Finance, Anglo Arabian Healthcare, Siraj Finance, and Bahrain’s ADDAX Bank. Mr. Al Noaimi is a UAE national with a degree in Finance and International Business from Northeastern University in Boston, USA.

Mansour is a Senior Advisor in the Structured Finance and Capital Markets unit in Mubadala Development Company. His prime responsibility, amongst others, is to plan, advise and execute debt fi nancing strategies for projects and corporates. Throughout his career with Mubadala, Mansour has played an instrumental role in negotiating and closing numerous award winning fi nancing transactions. He led the team in closing the $1.3 billion Dolphin 21' project bonds in February 2012. He also led the efforts on closing and funding the multi-tranche $4.1 billion debt fi nancing for the Dolphin Project in July 2009. Both deals won numerous awards by leading publications in the Project Finance fi eld. Mansour also supported a number of other transactions, including the leveraged buyout debt fi nancing for the acquisition of Zurich based Maintenance, Repair and Overhaul operator SR Technics and fi nancing Mubadala’s stake in the Dutch fl eet management company LeasePlan Corporation, the latter has been exited with a profi t. Additionally, Mansour has advised and supported a number of Mubadala related assets on raising stand alone debt fi nancing as well as other strategic initiatives. Mansour sits on the boards of Abu Dhabi Finance Company PJSC, Waha Capital PJSC, dunia Finance LLC, ALDAR Properties PJSC, Anglo Arabian Healthcare FZ LLC and Mesirow Investment Management Partners PJSC. Prior to joining Mubadala in 2004, Mansour spent 3 years with the Offset Program Bureau, formally known as UAE Offsets Group. During his time there, he was exposed to a number of projects across of sectors, including aerospace, real-estate, infrastructure, healthcare, fi nance and oil & gas. Mansour holds a Bachelor of Science in Business Administration (Information Systems) from Portland State University, Portland, Oregon,USA (2001).

MANSOUR MOHAMEDAL MULLA

DIRECTOR

SALEM RASHED AL NOAIMI

CHAIRMAN

RAJEEV KAKARMANAGING DIRECTOR

& CEO

GAN CHEE YENDIRECTOR

DR. AHMED KHALILAL MUTAWA

DIRECTOR

B O A R D O F D I R E C T O R S


Spiridon GoumasSanjay Kao Mariam ElsamnyMuzaffer Hamid Barlas BalabanerNajwa Al Rowaished

Rajeev KakarRaman Krishnan Venu ParameshwarAli Hurbas Ben SchuurmanMustafa Erim

M A N A G E M E N T T E A M


RAJEEV KAKARMANAGING DIRECTOR & CHIEF EXECUTIVE OFFICER

Rajeev is the Founder Managing Director and CEO of dunia. He is

also concurrently the EVP and Regional CEO for CEEMEA region for

Fullerton Financial Holdings (Fullerton), a 100% owned subsidiary of

Temasek Holdings, in Singapore. In his additional role as the EVP &

a Founder Global Management Board member at Fullerton, Rajeev

also heads the consumer banking business globally for all its Bank &

Financial Services operations in Pan-Asian markets of China, India,

Indonesia, Malaysia, Pakistan, Vietnam, Russia, and the UAE. With

over 27 years of experience in the banking industry, Rajeev has

worked in several global markets, especially in the high-growth,

emerging CEMEA and ASIA-PACIFIC countries. During his career,

he has managed several business turnarounds, launched start-ups,

and has a proven track record of running established businesses

successfully. Between September 2003 and January 2006, he was

the Regional Head & CEO for Citibank, managing the rapidly growing,

volatile and complex Turkey, Middle East & Africa region (TMEA),

based out of Dubai, U.A.E. Earlier, in July 2002, Rajeev was Citibank’s

CEO for the Turkey & Egypt cluster, based out of Istanbul, Turkey.

Prior to that, in 2000, he was the CEO for Citibank in Egypt, where he

launched its Consumer bank, as the fi rst in the market. This enterprise

was recognized as one of the best franchises in the Citigroup world

for having delivered the fastest break-even in Citigroup’s history.

In 1998, Rajeev founded a new green-fi eld Joint Venture Captive

Finance company, between Citigroup & Suzuki (Maruti), the largest

car manufacturer in India at the time, which grew on to become the

market leader. Forbes Middle East has consistently recognized Rajeev

as being part of the Top CEOs in the Arab World 2014 & the Top Indian

Leaders in the UAE in 2014 & 2013. At ITP’s Awards 2013, he received

the“CEO of the Year” Award. For the last four years from 2010 to

2013, he has been annually recognized by the Arabian Business “GCC

Power List India Top 100". In 2009, Rajeev received ITP’s “CEO of the

Year” Award for Financial Services in the Middle East, in recognition

for establishing dunia as a greenfi eld operation, amidst the global

economic downturn. Rajeev is currently a member of the Global

Management Board of Fullerton in Singapore. Rajeev is also a Director

on the Board of “Fullerton Securities & Wealth Advisors Ltd” (FSWA)

and “Fullerton India Credit Company Ltd” (FICC), headquartered in

India. Between 2010 – 2013, Rajeev was a Commissioner on the Board

of Commissioners for Adira Dinamika Multi Finance Tbk, in Indonesia.

Between July 2004 and February 2006, Rajeev was a member on the

CEMEA Board of Visa International. Since 2009, he has been a member

of the Global Advisory Board for the University of Chicago’s Booth

School of Business. He is also a member of the Industry Advisory

Board of SP Jain School of Global Management since 2011 and

a member of the Indian Institute of Management (PAN IIM Network)

Alumni Board in the UAE, since 2011. Rajeev completed a Masters

of Business Administration (MBA) in Finance and Marketing from the

Indian Institute of Management (IIM) Ahmedabad. He also received

his Bachelor of Technology in Mechanical Engineering from the Indian

Institute of Technology (IIT) Delhi.

Ali started his career at AT&T Universal Card Services in Florida,

U.S. in 1995, where he held various roles in Finance, Marketing and

Card Analytics. In 1999, he joined First USA Bank, now JP Morgan

Chase, as the Credit Policy Head for card acquisitions of core

brand, in Delaware, U.S. In 2000, he returned to Turkey, joining

Citigroup as the Credit Policy Head. This involved formulation of

the credit policies for the business. Subsequently, Ali moved to the

Strategic Analytics Unit of the bank. Prior to joining dunia, Ali was

with Citibank N.A. where he was Strategic Analytics Head for the

Middle East region and responsible for consumer banking analytics,

covering UAE, Bahrain, Egypt and Pakistan, while based in Dubai. Ali

has an Industrial Engineering degree from Bogazici University in Turkey

and an MBA from the University of Virginia’s Darden School.

Najwa has 19 years experience in various roles in Human Resources

for diverse organizations in the UAE. She started her career as a

Management Trainee with National Bank of Abu Dhabi, then moved to

HSBC to specialize in Human Resources. In 2000, Najwa joined Citibank

as the Resources and Development Manager and subsequently Najwa

moved to the government sector to become the Head of HR for the

Dubai Financial Centre. In addition, Najwa worked in the hospitality

sector and was the Director of HR for Jumeirah Group, an international

luxury hotel chain which is part of Dubai Holding. Prior to joining

dunia, Najwa led the HR function for Tamweel Finance PJSC. Najwa

was a member of the Dubai Human Development Award Committee

and has chaired the 1st Women Consultative Committee for the Banking

Sector in UAE. Najwa represented the Financial Industry on the board

of TANMIA'S Consultative Committee, and was also the chairwoman

for the Finance and Banking Sub-Group with Dubai Quality Group.

ALI HURBASSTRATEGIC ANALYTICS HEAD

NAJWA AL ROWAISHEDHUMAN CAPITAL HEAD


Venu has over 30 years of experience in banking and fi nance in a

wide range of functions and countries including India, Australia,

Korea, the UAE and the UK. His previous roles include Portfolio Risk

Manager – Citibank Australia, Treasurer – Citibank Korea, CFO and

Treasurer – Citibank India, Regional Consumer Treasurer – Citibank

CEEMEA and CFO – Citibank Turkey, Middle East and Africa. His last

assignment was the Consumer CFO for the EMEA region for Citigroup

where he was responsible for the fi nance function across Citigroup’s

consumer business in Western and Central Europe and the Middle East.

Venu is an Economics graduate from the University of Bombay and

has completed his Masters in Business Administration from the Indian

Institute of Management, Ahmedabad. He is also a Fellow member of

the Institute of Chartered Accountants of India.

Mariam has over 19 years of experience in Retail Banking and

Marketing. Her latest role prior to joining dunia was with Citibank,

UAE as Marketing and Product Head handling the bank’s retail

products, Marketing Communication and Internet Channel for the

bank. Mariam has handled several key start-up businesses during

her 9 year stint with Citibank – Citibank Egypt, UAE and Russia – as

well as dunia. Mariam began her career with Procter & Gamble in

Marketing. She is a double MBA holder from University of Chicago

(2008) and from the American University in Cairo (1997).

Barlas has worked in the banking industry for almost 22 years in

various geographies including Australia, Indonesia and EMEA. He

has diverse experience in both Consumer and Corporate Banking

Operations and Technology Management and M&A projects in the areas

of Infrastructure startups, Branch Network expansion, Data Center

Operations, Technology Organization Management, Quality Assurance,

Productivity, Financial Control, and Customer Service Excellence.

Barlas’ last assignment prior to joining dunia was the Operations and

Technology Director for Citibank’s Global Consumer Bank in Turkey

and Executive Board Member of Citibank A.S. Barlas graduated from

Bogazici University in Istanbul with a BA in Economics.

Raman has over 25 years of varied banking experience across India,

Singapore and Indonesia besides the UAE. Raman’s last assignment

prior to joining dunia in 2008 was on the Board of Directors of Permata

Bank, an Indonesian joint venture between Standard Chartered

Bank and Astra International, an Indonesian conglomerate, with

responsibilities for Risk Management. Before joining Permata Bank,

Raman was in Standard Chartered Bank for over 15 years in several

functions. In his last assignment in Standard Chartered Bank, Raman

was based in Singapore, heading the Business Risk Review function

for the Consumer Banking Group. Raman is actively involved in

designing and rolling out risk training programs aimed at improving

risk literacy within dunia. He holds a business management graduate

degree from the Indian Institute of Management, Calcutta. Raman is

also an Associate Member of the Institute of Chartered Accountants

of India.

VENU PARAMESHWARCHIEF FINANCIAL OFFICER

MARIAM ELSAMNYCHIEF MARKETING OFFICER

BARLAS BALABANEROPERATION HEAD

RAMAN KRISHNANCHIEF RISK OFFICER


Ben has joined dunia after a successful career with Royal Bank of

Scotland (RBS) and earlier with ABN AMRO where he has gained

considerable experience globally in senior positions within the IT

function. In his last role, he was the Regional Chief Technology Offi cer

for RBS based in Amsterdam where he was responsible for delivery

across 21 countries apart from network standardisation, data center

and country model standardization. Prior to this, he held various senior

roles as Chief Information Offi cer (CIO) for RBS Asia as well as ABN

AMRO Asia Pacifi c based in Hong Kong between 2007 to 2009 covering

the retail banking, commercial markets and wealth management

verticals, apart from playing a key role in the integration of ABN

platforms and networks with RBS after the merger. Prior to this, Ben was

the Global CIO for the Private Banking function from 2006 to 2007 and

Head of Infrastructure Technology for Europe from 2005 to 2006 and

held the position of interim CIO for the ABN AMBO Netherlands

business unit from 2003 to 2005. Ben also held multiple roles in retail

banking from 1982 to 2003 in product management, retail lending

and mortgages in the Netherlands. Ben holds a degree in Marketing and

Macroeconomics from the University of Groningen in the Netherlands.

Spiridon (Spiros) has a seasoned career of over two and a half

decades with leading fi nancial institutions in North America,

Europe and now Middle East. Apart from his compliance expertise,

he also has a signifi cant experience in retail sales, and back offi ce

senior positions in banking. Prior to joining dunia, he was based in

Athens, Greece, where he worked from 1994 to 2011 for both local

and international fi nancial services providers, including ING Bank,

Citibank, The National Bank of Greece, and T Bank (Fr. Aspis Bank).

As the Group Compliance Director for the National Bank of Greece

(NBG), Spiros in essence established the compliance function, in line

with NBG's regional growth expansion in South East Europe, after a

successful career as Country Compliance Offi cer responsible for all

Citigroup entities in Greece and Cyprus, and a Senior Compliance

Manager appointment with ING Bank in Athens. Spiros started his

fi nancial services career in 1986 in British Columbia, Canada, where

he originally engaged with the Life Insurance sector, followed by

a subsequent position in retail banking (1989 - 1994). Spiros is a

graduate of Athens College and also holds a BA from Simon Fraser

University in Canada.

Muzaffer is part of the founding team at dunia and has 16 years

experience in the Operations & Technology area. Prior to joining dunia,

Muzaffer’s last assignment was with Citibank Bahrain as the Chief

Operating Offi cer covering all areas of Core Operations, Technology

Management, Collection Management and Risk & Crisis Management

across all functions of the bank. Muzaffer started his career with

Citibank Dubai and then moved to Citibank South Africa in the Global

Corporate & Investment Bank with Citigroup. During his time at

Citigroup, Muzaffer was also part of the regional Audit & Risk Review

team as a subject matter expert in the area of Operations & Technology

Management. Muzaffer has an MBA degree from University of Sheffi eld

(UK) specializing in Technology Management and a Bachelors degree in

Finance from European University of Cyprus.

BEN SCHUURMANCHIEF INFORMATION OFFICER

SPIRIDON GOUMASHEAD OF COMPLIANCE

MUZAFFER HAMIDCENTRAL OPERATIONS HEAD

Sanjay brings a wealth of experience and proven results in Consumer

Banking across products and in multiple markets. Most recently, he was

the Head of Consumer Finance for RBS Asia, responsible for China, Taiwan,

Hong Kong, Singapore, Indonesia, Malaysia, India and Pakistan. In this role,

he led the Asia Strategy and P&L streamlining following the RBS acquisition

of the ABN AMRO franchise. Prior to this, Sanjay held senior leadership

roles with Citibank in Asia Pacifi c, based in Singapore and Indonesia as well

as positions in Egypt, Thailand and India. Sanjay has also worked in the

UAE from 2001 to 2003, when he held the position of Head of Marketing

with Mashreq Bank. Sanjay started his career with Unilever India as a

management trainee, and took on sales and marketing roles during his 7

year stint with them. He holds a Business Management Degree from the

Indian Institute of Management, Calcutta and is a Bachelor of Technology

in Chemical Engineering.

SANJAY KAOCONSUMER BUSINESS HEAD


Prior to joining dunia, Mustafa held the role of Head of Audit for

Africa and Indian Ocean (2010 – 2011) and UK Retail Banking

(2007 – 2010) in Barclays Bank PLC, leading large teams to deliver

assurance and operational advice. Before that, he was a senior

member of the Audit and Business Advisory Services unit at

PricewaterhouseCoopers (PwC), UK between 1999 and 2007 and

established the PwC Emerging Markets Risk Management (EMRM)

team delivering risk management advice to multinationals entering

emerging markets. He also setup and led the risk management

consulting division in PwC Turkey from 1994 – 1999. Mustafa holds an

MBA from Warwick Business School, UK as well as a BS (Hons) Degree in

Mathematics from the Middle East Technical University in Ankara,

Turkey. In addition, he is a Certifi ed Information Systems Auditor

(CISA) and holds an Islamic Finance Qualifi cation (IFQ) from the

Chartered Institute for Securities & Investment (CISI).

JASSIM AL HAMMADIHEAD OF STRATEGIES AND

SPECIAL PROJECTS

Jassim started his career as an economic analyst for Citigroup in

Dubai,UAE. He worked with assistant Chief Economist of Citigroup

Middle East. Later he was appointed as a partner in the private equity

fund for the MENA region as a fund manager by Islamic Development

Bank and Gulf Finance House. Jassim worked for Dubai Islamic Bank’s

initiative “Tamweel” as head of Corporate Strategies and Planning

during which he played a key role in development and execution of

the strategic plan to gear the company from inception to growth from

2015 to 2017. Jassim worked as principle consultant and advisor at

AT Kearney, a US based global management consulting fi rm. During

his tenor at AT Kearney, Jassim was appointed as a strategy and

performance advisor to the Prime Minister's Offi ce of the UAE where

he contributed to development of federal government strategies,

economic policies and planning in 2007. Later he was appointed as

an Economic strategy and policy advisor in 2010 at the Executive

Council, Government of Dubai. Jassim has B.Sc degree in Economics

from Virginia Commonwealth University, Richmond, Virginia, U.S. and

Masters in Strategic Management from University of Liverpool, UK.

MUSTAFA ERIMHEAD OF AUDIT


L A U N C H I N GI N T O O R B I T


BURJ KHALIFA

Burj Khalifa is the tallest man-made structure in the world, at 829.8 m (2,722 ft). It was designed to be the centerpiece of a large-scale, mixed-use development that would include 30,000 homes, nine hotels, 3 hectares (7.4 acres) of parkland, at least 19 residential towers, the Dubai Mall, and the 12-hectare (30-acre) man-made Burj Khalifa Lake.

The design of Burj Khalifa is derived from patterning systems embodied in Islamic architecture. The building's design incorporates cultural and historical elements particular to the region such as the spiral minaret.

Burj Khalifa has achieved several world records:• Tallest existing structure: 829.8 m (2,722 ft) • Tallest structure ever built: 829.8 m (2,722 ft) • Tallest freestanding structure: 829.8 m (2,722 ft) • Tallest skyscraper (to top of spire): 829.8 m (2,722 ft) • Building with most fl oors: 163 • Building with world's highest occupied fl oor: 584.5 m (1,918 ft)• World's highest elevator installation • World's longest travel distance elevators: 504m (1,654 ft)

S O A R I N G

H E I G H T S

Source: http://en.wikipedia.org/wiki/Burj_Khalifa


A N E W D A W N H A S R I S E N O V E R T H E U A E ’ S

F I N A N C I A L D I S T R I C T A S O N E I N S T I T U T I O N ’ S

PA S S I O N C O N T I N U E S T O S H I N E B R I G H T O N

T H E H O R I Z O N .

L I F T I N G O F F T O

N E W H E I G H T S

Founded on a set of customer-centric beliefs and a strong vision, we pride ourselves on doing things differently. We’re redefi ning the rules of the game…and just like how the UAE is changing the way the world sees the region, we’re changing the way people see their fi nances. No more stress. No more uncertainty. No more long waits.

Welcome to a new age of fi nance. Welcome to dunia.

Our customers trust us because we make them feel comfortable about their fi nancial challenges and show them there’s no challenge that can’t be overcome. From our personal approach in our branches to our tailor-made solutions, we always put ourselves in their shoes. It’s this unique ethos and approach that helps make our customers and our business rise ever higher. And we do all of this… with a smile on our face.

But it doesn’t end there…

Our customer-centric set of principles needs a strong team of likeminded people to ensure that we all speak the same language. So in order to keep rising, we aim to attract the right talent. Their experience, personality, and passion for our business are carefully studied. They unlearn old habits and adopt new innovative ways to approach our business. We continue to teach them new things, and create a culture where our employees’ careers are constantly being nurtured with the proper training and experience so they too can rise even higher. Now, we have the best fi nancial experts in the region steering us in the right direction and we continue to invest in them, so they can continue to invest in us.

Today, our philosophy instills a culture that cements our reputation. Our customers, employees, and shareholders have confi dence in us. But most importantly, they cherish our human approach to their needs as our years of experience continue to build trust and transparency. We believe our way of doing things is the future of fi nance.

We are paving the way in the UAE’s fi nancial services sector with a different approach. An approach that puts our customers fi rst. An approach that nurtures our talent. An approach that sustains healthy and profi table growth for our company. To our investors, we are on the road to profi tability. To our customers, we are easy to work with and experienced in solving your fi nancial challenges.

So, the next time you’re looking for a fi nancial service that’s friendly, regulated, and has a proven track record…think of us.

We're dunia. We do things differently.We're different. Guaranteed.


Our fifth year of evolution took dunia and its unparalleled approach to customers services to a new height. Our journey over the years has seen us innovate new product offerings year on year with the sole purpose of creating real customer delight and superb value.

As our geographic reach has spread throughout the country to more than 19 financial centres, so too has our range of customer services and product offerings. As we look ahead to 2014 and beyond, we cast our gaze towards the sky: committed to looking above and beyond the ordinary and to empower, enrich and enable our customers. Our journey continues as we move towards the stratosphere.

Washington Post writes about dunia’s home grown analytics modeldunia launches Dunia Young Business Leaders ProgramRajeev Kakar, Managing Director & CEO, recognized in Forbes Middle East list of “Top Indian Leaders in the UAE”dunia awarded for ‘Innovation in Learning’ at the Asian Learning & Development Leadership AwardsFitch Ratings assigns Dunia Finance (dunia) a Long-term Issuer Default Rating (IDR) of 'BB-'Singapore Management University (SMU) publishes 2nd case study on duniadunia launches Diamond Card with 3% unlimited cashbackdunia's 2012 Annual Report wins 'Gold Award' in the League of American Communication Professionals (LACP) Award and is ranked 43 worldwidedunia publishes its first ever Sustainability Report

Feb

May

July

Sep

Oct

Nov

Dec

800th employee joins duniaImage Cheque Clearing System (ICCS) implementeddunia achieves break-evendunia launches the Club Apparel - dunia Credit CardRajeev Kakar recognized in 'GCC India Power List 2011' for 'Top 100 Indians' in the regiondunia launches ‘dunia Touch’ for global volunteering programsdunia Academy introduces a wide range of training programs

JanMar

Sep

Nov

Dec

2011

100th employee joins duniadunia incorporationBlue printing phase completeddunia open doorsHamdan Branch openingdunia launches Personal Loansdunia launches Corporate Depositsdunia launches dunia Credit

MayJulAugSep

OctNov

First employee joinsdunia dunia is conceptualizedPlanning & blue printing phase to deliver a unique customer focused business model

JanMar-JulSep‘06Aug’08

2008

2006 TO 2007

dunia enters into partnership with MasterCard Worldwidedunia launches dunia Financial Plannerdunia launches Education Loansdunia launches Durable Good Loansdunia launches duniaCredit LifeRajeev Kakar recognized by HH Ruler of Sharjah for his special efforts in supportingand developing UAE TalentLaunch of 'Kawader dunia' Emiratization program, in partnership with S.P. Jain Center of Managementdunia launches Auto Loansdunia launches Car Cash-in Loansdunia wins award for 'Best Use of Technology' at Banker Middle East Industry Awardsdunia signs agreement with Ministry of Finance to perform bank guarantee e-registration servicedunia launches dunia Wallet & Life Guard Insurance700th employee joins duniaRajeev Kakar awarded 'CEO of the Year - Financial Services'dunia launches Diamond Credit Cardsdunia wins 'Special CSR Award' at the Arabian Business Achievement Awards

Jan

Mar

Apr

May

May

Jun

JulSep

Dec

2009

Al Wahada Branch openingPassport Road Service Center openingMedia City Branch openingKarama Service Center openingNaif Service Center openingRolla Service Center openingMusalla Road Service Center openingNational Paints Service Center openingKnowledge and Human Development Authority(KHDA) signs MOU with duniadunia launches Wages Protection System (WPS)Payroll SolutionDefence Road Service Center openingMusaffah Industrial Area Service Center openingAl Quoz Service Center openingAl Qusais Service Center openingOud Metha Service Center openingdunia launches Commercial Auto LoansDubai Outsource Zone Service Center openingdunia launches Flexi Loan FacilitiesAl-Ain Branch openingKhalidiya Service Center openingRajeev Kakar recognized in 'GCC India Power List2010' for 'Top 100 Indians' in the regionMoroor Service Center openingMussaffah Commercial Area Service Center openingdunia's 2009 Annual Report wins 'Honors Award' inInternational Mercury Awardsdunia's 2009 Annual Report wins 'Platinum Award'in the League of American CommunicationProfessionals (LACP) Award

Jan

MarApr

May

Jun

Jul

Aug

Sep

Nov

Dec

2010

dunia ranked 5th in Gulf News’ Best Practices in UAECase study on dunia published by Singapore Management UniversityRajeev Kakar recognized in ‘GCC India Power List 2012’ for ‘Top 100 Indians’ in the regionUniversity of Virginia’s Darden School of Management writes a case study on duniadunia records 305% growth in net profit through its customer centric approachdunia awarded "Excellence in Financial Reporting" for Annual Report FY 2011 amongst Mubadala entitiesdunia ranked 4th in Gulf News’ Best Practices in UAE

Feb

Apr

Oct

Dec

2012

2013

G R O W I N G E X P O N E N T I A L LY


T H E D U N I A J O U R N E Y

The dunia story is a remarkable one. We launched in 2008 with a signifi cantly different approach to providing individuals and corporate customers with fi nancial services solutions.

At the company’s core is one major point of difference: it was founded on a set of customer-centric beliefs and a strong vision to build a fi nancial services organization that could rebuild trust; trust built on back-to-basics banking. The team at dunia wanted to put customers’ needs fi rst. Absolutely central to the company ethos was – and still is – the commitment to relentlessly pursuing excellence in every way.

Our journey and growth have been fast, taking us to great heights. Profi table within three years, the business has built a robust balance sheet and an organically expanding customer base. We believe this success comes through…

1. Relentless focus on employees and talent enhancement – eliminating mediocrity and reaching for the highest levels of service.

2. Relentless focus on customers – raising the bar, delivering on our promise and engaging on a real-time human basis. We exist solely for our customers – we have never lost sight of that.

3. Commitment to innovating and improving everything we do, enhancing our capabilities, driving effi ciencies and making the customer experience truly exceptional.

4. Relentlessly pursuing excellence in our execution both internally and externally for all stakeholders – our execution must be fl awless.

5. Teamwork is a guiding principle for us – one team of intelligent, experienced professionals who share a united vision.

We have worked hard – against the odds – to build a business that is respected. We have set ourselves on a different trajectory. We view ourselves differently. Crucially, we treat our customers differently. Our customers trust us, our employees trust us and our shareholders trust us. All stakeholders share a united vision and a united philosophy.

From the start, dunia sought to act in a way that is whiter than white: committed to sustainable growth and transparency in everything we do. Our growth is sustainable thanks to our commitment to building a well-leveraged balance sheet. Ethical banking, transparency and an unwavering commitment to customer service has led us to a point where we are now on the crest of a wave.

Now fi ve years into the operation, and we are recognized for our unique approach, resilience and success. We believe in promoting customer protection and in pursuing standards of excellence: these are items fi rmly fi xed on our agenda when we engage with regulators and the fi nancial services industry.

After fi ve years of hard work: building robust, world-class processes and systems, attracting some of the world’s most talented people and innovating superb products, we are now set to move to new heights. Our sights are set high – they always have been. We have a proven model that works – and that works incredibly well for the interests of all stakeholders: employees, customers, shareholders and the wider community.

Together, we will all look forward – and upwards – towards our next chapter of success.

D O I N G I T D I F F E R E N T LYD O I N G I T D I F F E R E N T LY


B R E A K I N GB A R R I E R S


A F U T U R E

W I T H L I M I T L E S S

P O S S I B I L I T I E S

Expo 2020, is a Universal scale Registered Exposition time slot sanctioned by the Bureau of International Expositions (BIE), Paris on 27 November 2013. Dubai won the right to hold Expo 2020. The World Expo in Dubai in 2020 will be the fi rst to be held in the MENA & SA (Middle East and North Africa & South Asia) region. UAE selected the theme “Connecting Minds, Creating the Future”. With its theme, the Expo bid fosters both a philosophy of mutual understanding and cooperation and a hands-on approach to fi gure out the solutions to three tangible sub-themes: mobility, sustainability and opportunity. For Dubai, these three challenges are so interconnected that they have to be addressed simultaneously in order to fi nd truly global answers. Mobility adresses issues of logistics, smart engineering and energy consumption. Sustainability is about preserving our resources and ensuring everyone has access to them. Opportunity is being able to adapt to an ever-changing world and develop new economic models that take into account cross cultural exchange, the progress in technology and the vital role of sustainable development. Expo 2020 Dubai will celebrate the 50th anniversary of the UAE. In only a few decades, Dubai has become one of the world's most modern, innovative and technological cities, attracting investors and workers from over 200 countries. With a target of 25 million visitors, the Expo will continue building Dubai and the UAE's status as a world hub and after the Expo.

UAE EXPO 2020Sources: http://www.bie-paris.org/site/en/2020-dubai-uaehttp://en.wikipedia.org/wiki/Expo_2020


G O I N G T H E E X T R A M I L E

F O R C U S T O M E R S

dunia’s entire business is built around one core focus: the customer. From the outset, our vision was to approach customer relationships from a different angle: to listen and respond empathetically and in a caring manner. The principle of ‘response’ is critical and dunia’s systems and structures, technologies and customer service promises all lead to the policy of rapid response. We believe that we can truly delight our customers through delivering excellence and effi ciency at every point of customer engagement.

We also wished to build a workforce that truly refl ected our customer base and the broad multi-cultural make-up of UAE society. In this respect, we are always responding to our evolving customer base. We are creating customized solutions for each of our ethnic segments. We are hiring individuals who understand the cultural habits of each and every customer. Listening – and responding – are the two fundamental elements in how we interact with our customers.

Our customers are our greatest asset and we are constantly striving to deliver even greater value and set higher standards. Our customers have a vested interest in receiving relevant solutions – be they new products or rewards. We too, wish to become closer to our customers by providing them with products and services that help them achieve their own goals and aspirations. This is as relevant to the individual as it is to the start-up business or growing enterprise. Customer service and high quality, relevant, innovative products drive everything we do.

S H A R E D G O A L SS H A RS H A R

Gaining access to financial services changes lives. This is why providing relevant products is so important – because each customer is different. We innovate in order to provide services and products that we know will make an impact: that will help individuals to set up new businesses, finance personal needs or that will help growing companies through tough times.

Our goal to change lives also underpins our commitment to supporting national objectives. We understand that financial inclusion and helping SMEs to grow is an important way to support the nation’s goals. Supporting SMEs leads to job creation… it empowers people, enables success and enriches lives. These are our goals for individual customers, corporate clients and the nation.

Our journey so far – and our success – has revolved around our customer promise and it is this that will see dunia and its customers achieve even more. We are committed to holding on to our values, our capabilities and the goals that we share with all of our stakeholders.

To ensure that the business runs smoothly and on target, dunia follows a balanced scorecard approach, which ensures that we remain focused not only on the financial but also o the driving factors of our financial strength – the franchise goals, risk management, process control & governance, people and strategic initiatives.

Using this approach, goals for all the critical aspects of the business were set right from the start and performance tracked. Since we track our performance against various metrics that impact the overall business, the organization as a whole moves towards its financial goals with greater ease. This approach has helped dunia create a sustainable business and to consistently enhance shareholder value.

O U R P R O M I S EO U R O U R

C H A N G I N G L I V E SC H A N G I N G L I V E S


At dunia, we rigorously monitor and manage the dunia portfolio to deliver and exceed on key top-line and bottom line targets. We monitor and manage the balance sheet for predictability, profi tability and sustainability.

F I N A N C I A L G O A L SF I N A NF I N A N

We aim to deliver on rapid expansion initiatives covering but not limited to:• Expansion in all existing segments• Launch new segments based on ethnic groups • Review inorganic opportunities

F R A N C H I S E G O A L SF R A NF R A N

At dunia we believe in strengthening operational risk management capabilities to support business growth and mitigate risk. We also focus on ensuring robust liquidity management to ensure sustainability and optimal shareholder return, on a complete stand-alone basis.

R I S K M A N A G E M E N TR I S K MR I S K M

We ensure optimal deployment of IT capabilities and architecture in line with business needs, new capabilities and evolving technology. We want to deliver service excellence which will lead to customer delight. We endeavor to maintain a robust control environment at all times.

P R O C E S S C O N T R O L & G O V E R N A N C EP R O C E S S C OP R O C E S S C

Build a strong talent pool and leverage skill and knowledge base for business excellence and sustainability.

P E O P L EP EP E

Institutionalization of dunia through enhancement in policy framework, governance standards and overall holding structure and external credit rating.

S T R A T E G I C I N I T I A T I V E SS T R A T E GS T R A T E

D R I V I N G E X C E L L E N C E T H R O U G H A

B A L A N C E D S C O R E C A R D A P P R O A C H


A C H I E V I N G M O R E T O G E T H E R


H E L P I N G O U R

C U S T O M E R S S TAY A H E A D

Our entire product range has been built around the customer. From the moment we meet a prospective customer, we set in motion a series of actions that help us to understand their unique needs. Every customer is offered a solution that is relevant and suitable to his or her requirements.

The ‘dunia One’ account is our way of offering each customer a customized package of financial solutions. We deliver this through a single window, aided and backed by an extensive branch network and highly personalized customer support team.

FOR INDIVIDUALS

Individuals can benefit from a range financial solutions that meet their own, unique needs. Our suite of products for individuals include:

• A range of different credit cards, each with its own unique value proposition – reward schemes and unique benefits that are relevant to the individual customer

• Personal loans for specific needs, ranging from car loans to durable loans, flexi-loans and education loans

• Our auto loans can be used to purchase new and used cars – as well as car-cash-in loans

• Overdraft facilities with flexible repayment options

• Simple insurance products linked to cards and loans that offer protection

D U N I A O N ED U N I A O N E

FOR CORPORATE CLIENTS

We have developed a range of financial products that present our corporate clients with the ability to select services and products that meet their own unique requirements. These include:

• Corporate deposit accounts

• Issuance of labour and financial guarantees

• Payroll processing through Wages Protection System (WPS)

• Special pricing for corporate products

• Dedicated Corporate Relationship Manager

• All-in-one account servicing

Corporate clients may also take advantage of dunia’s range of financial solutions for their own staff. We offer preferential terms, unmatched discounts, unique rewards and exciting privileges.

Our approach to finding the right solution for each client has been to build a tailor-made, segment-based model. This structure helps our team of professionals to learn about the varying needs of our entire customer base on a far more granular level, helping them to understand each customer, become closer to them and deliver relevant solutions. This helps us to craft a unique value proposition for each and every customer.

Our four segments enable our highly expert and experienced team of Relationship Managers to focus more on the individual customer rather than on selling products. The starting point for every Relationship Manager is to understand the segment and the customer’s own needs, then offer solutions that match their needs.

D E L I V E R I N G V A L U E F O R D E L I V E R I N G V A L U E F O R

C U S T O M E R S ' U N I Q U E N E E D SC U S T O M E R S ' U N I Q U E N E E D S


Mass Affluent

Affluent

Corporate

Commercial

SME

Salaried Mass MarketSelf-Employed Mass Market

duniatrade was the answer to the most pressing fi nancial need of the ‘Self-employed consumers’. An often neglected and under-served section of society, this segment needs fi nancial services that are legitimate, thereby steering them away from parallel, unreliable banking channels. duniatrade vows to be a caring community-based fi nancial services provider designed specifi cally to serve the unbanked or under-served self-employed, through a superior relationship experience, empathy and respect, with convenient, fast and easy access to credit for their business and personal needs, to help them grow their businesses and provide for a better future for self and family.

duniagold customizes elite solutions for the exclusive needs of its most ‘Affl uent’ members of the community. While providing fi nancial solutions that enhance their lifestyle, the state-of-the-art service ensures the speed and effi ciency that is demanded by their evolving life and business interests. duniagold was built to be a provider of customized and tailor-made solutions that cater to the unique fi nancial and lifestyle needs of affl uent customers and meet their aspirational goals by providing a wide range of fi nancial products and services, while delivering these with exceptional service and convenience through a single point of contact.

duniamoney was tailor-made to provide fi nancial solutions to the 'Salaried consumers'. Simplifi cation of processes ensured that even the most unique of fi nancial needs are implemented rapidly, while specialized product solutions catered to the specifi c needs that are exclusive to this particular customer segment. duniamoney strives to offer a community based, superior service and relationship experience based on empathy and respect, while delivering customers with easy credit and simple savings products to meet their simple fi nancial needs, in order to help them provide for a better future for self and family back home.

. . . C U S T O M I Z E D U N I Q U E LY

T O S E R V E O U R C U S T O M E R S

dunia offers to its ‘Mass Affl uent’ customer segment, an array of fi nancial solutions at their very doorstep. Professional expertise on every fi nancial solution offered is ensured as a one-stop shop option to optimize valuable time and energy. dunia is designed to be a provider of a wide range of customized fi nancial solutions through superior products, service and relationship experience based on respect, with easy access through an empowered Relationship Manager, alternative access channels for convenience and speed, to provide for a better lifestyle and future for self and family back home or internationally.

O U R VA L U E P R O P O S I T I O N . . .


W O R K I N G T O G E T H E R . . . . . . C H A L L E N G I N G T H E S TAT U S Q U O


D E L I V E R I N G O U T S TA N D I N G

C U S T O M E R S E R V I C E

Our customer-centric approach, by its very nature, puts customer engagement at the heart of all operations. We are entirely focused on achieving customer delight: access to support and services quickly, effi ciently and effectively. We actively seek the ‘wow’ factor in all customer relations because we understand the importance of human contact and a rapid response. Access to fi nancial services and the quick handling of problems, concerns or queries makes all of us relax, smile and rest easier. This level of customer delight is what we strive for – this is the ‘wow’ factor.

We now have 19 fi nancial centers across the UAE, providing greater choice for our customers. The locations are chosen for their ease of access and convenience.

The Contact Centre serves customers 24/7, 365 days a year. This enables us to provide real-time support to all customers 24-hours a day; access to a human being, no matter what time of the day or night – and one that speaks the language that our customers are most comfortable with.

Automation ensures straight-through and error free processing. Our imaging system enables us to operate in a paperless fulfillment process. Customer documents are scanned remotely, ensuring smooth communications and rapid decision-making: this is an enormously convenient and hassle free way of handling processes that involve paperwork.

G E T T I N G T H E R E F A S T E RG E T T I N G T H E R E F A S T E R

All customer-facing professionals at dunia are monitored through Key Performance Indices (KPIs) and other metrics. This is a critical part of our own self-assessment as we strive towards learning from our own experience in order to build an even greater customer experience. It is a shared view at dunia and amongst all stakeholders that none of us have – or should – stop learning. We consider ourselves, therefore, in a perpetual state of learning, innovating and developing better ways of reaching our goals.

M E E T I N G O U R C O M M I T M E N TM E E T I N G O U R C O M M I T M E N T


G U I D E D B Y A R O B U S T S E T O F M E T R I C S T O T R A C K P E R F O R M A N C E

E V E R Y M O M E N T

• Open customer complaints

• Average turnaround time to resolve customer complaints

• Problem incidence

• Problem resolution satisfaction

• Timeliness of resolution

We also provide a thorough and easy to use online platform, providing information and access to customer support channels. dunia Online enables customers to log on at any time and perform a full range of transactions autonomously and at their own convenience, ensuring that all of our customers’ needs are met rapidly and efficiently.

dunia has been ranked as a top-tier company for superior service provision by Gulf News for three years running. In 2013, dunia was ranked 4th, confirming yet again our commitment to superior service. The Gulf News Service Honor Roll ranks service providers on the following critical factors:

• Satisfaction of solutions provided to customer queries• The speed with which customer complaints are handled• The transparency of processes• Adherence to compliance• The company’s attitude towards its own customers

This is also reflected in dunia’s customer satisfaction levels which are currently at an average of 80%+, as per our internal regular customer satisfaction survey results.


CUSTOMERRELATIONSHIP

PEOPLE

Superior service & robust deliveryStrategic Cost ManagementDestroy, De-Layer, OutsourceDifferentiate between “Bad” expense & “Good” expense

OPERATIONS

Focus communications on customers, not productsClear brand positioningOptimize marketing efforts across productsTest and Roll-outAlign products to customers needs

MARKETING

3 ‘R’s - Risk / Revenue / ResponseIntegrated Risk ApproachFormulate cross-sell policiesBuild an integrated acceptance process

CREDIT & RISK

Full function, relationship based interfaceFoster multi-channel product selling & servicingBranch, Phone, RM, InternetAppropriate KPIs & variable compensation plansBuild on customers relationship vs. product pushing.Tie rewards closely and demonstrably to motivate people to deliver value

SALES & DISTRIBUTION

Single customer viewState-of-art data warehouseCustomer RelationshipManagement system

ANALYTICS

Measure & Manage profitability at customer levelTrack Metrics (Cost/income, Operating Leverage, Expense/ Assets)

FINANCE / BP&A

Provide customer enhanced value• Solutions• Recognition• Advice• Planning• Guidance• FairnessValue & Recognition• Status, visibility• Esteem• Rewards• Events• Special pricing

REWARD & RECOGNITION

PRODUCTS

• Full Range• Life - stage approach• Cross-sell benefits• Customised to need

PROCESS

• Superior Service• Simple• Convenient• Error - free• Timely• Compatible• Friendly

PEOPLE

• Trained & Compatible• Empathic• Responsive• Customer Oriented• Ethical & Fair

MARKETIN

G

SALES &

DISTRIBUTIO

N

OPERATIONS

REW

ARDS

&

RECOGNIT

ION

PROCES

S

PROD

UCT

ANALYTICS

FINANCE / BP&A

CRED

IT &

RIS

K

E M P O W E R I N G C U S T O M E R S

T H R O U G H T E C H N O L O G Y

Technology has always been central to our commitment towards customer service. We have adopted new technologies and invested in world-class analytics and CRM systems that lead to higher levels of customer satisfaction and greater effi ciencies for dunia.

A key factor in delivering seamless, high quality customer service is the deployment of world-class CRM systems. We decided to create a custom-built proprietary technology platform. This unique system was designed for and by us after extensive research and as such is absolutely relevant to our own goals as a business: putting customers first. This technology, supported by best-in-class applications, helps us to streamline our processes, providing customers with significantly faster turnaround times.

The efficiencies that are gained from having a tailored technology platform filter through to the benefit of all stakeholders. Customers benefit from high service levels and the Relationship Manager is able to gain access to complete customer relationship history at the touch of a button, providing rapid, around the clock support that is efficient and effective.

Our unique system also provides value in its ability to help us to provide relevant cross-sell and upgrade options for customers on a personal and / or automated basis. This system draws together customer behavior, profile and eligibility to ensure that all lending is risk-assessed and underwritten in a consistent fashion.

dunia continuously invests in upgrading its technology platform in order to ensure enhanced reliability and predictability, thereby helping customers stay ahead. Several critical initiatives that were launched included integrating with the new UAE Direct Debit System for seamless processing of payments, introduction of EMV Chip and PIN card enabled technology which makes transactions more secure for customers, and many more initiatives.


dunia has a fully-fledged data warehouse, which provides for analytics-based decision-making. This enables faster response times and instant customer reward mechanisms. Each customer benefits immediately from our analytics from the very first point of contact. Their individual, personalized customer profile is uniquely created through the data warehouse, enabling us to create a pricing and product offering that is personalized and relevant to each and every customer. Thereafter it is helps us to deepen our customer relationships and cross sell relevant products. dunia’s state-of-the-art data warehouse granularly manages every portfolio, which not only manages risk but highlights revenue opportunities and minimizes response time in a multi-dimensional format to ensure predictability, above and beyond what can be achieved with conventional systems. Our analytics also enables us to deliver consistency across all decision-making processes, ensuring that customers receive a fair response.

O F F E R I N G T A I L O R E D S E R V I C E S O F F E R I N G T A I L O R E D S E R V I C E S

T H R O U G H A N A LY T I C ST H R O U G H A N A LY T I C S


S E T T I N G N E WS TA N D A R D S


Masdar City is an arcology project in Abu Dhabi, in the United Arab Emirates. Its core is a planned city, which is being built by Masdar, a subsidiary of Mubadala Development Company. Masdar City will host the headquarters of the International Renewable Energy Agency (IRENA). The city is designed to be a hub for cleantech companies. Masdar City will be the latest of a small number of highly planned, specialized, research and technology-intensive municipalities that incorporate a living environment, similar to KAUST, Saudi Arabia or Tsukuba Science City, Japan. The project is supported by the global conservation charity World Wide Fund for Nature and the sustainability group BioRegional. In response to the project's commitment to zero carbon, zero waste and other environmentally friendly goals, WWF and BioRegional have endorsed Masdar City as an offi cial One Planet Living Community.

D E F I N I N G

N E W

F R O N T I E R S

Source: http://en.wikipedia.org/wiki/Masdar_CityMASDAR CITY


S E R V I N G T H E N A T I O N

We are a UAE-born business. We understand the intimate link between a nation’s long-term economic success and the education and empowerment of its own people. We focus on providing opportunities, skills and experience to those individuals who will go on to shape the nation today and tomorrow. All nations that achieve greatness, whatever their shape and size, have managed to build a strong and experienced, resilient and ambitious homegrown workforce.

At dunia we take this commitment incredibly seriously. Our Emiratisation strategy is to identify, train and hire UAE nationals, investing resources in building up a workforce of local talent. Our strategy has three key elements:

- ENGAGEMENT AND HIRING

- DEVELOPMENT AND TRAINING

- INTEGRATION

We firmly believe that Emirati business leaders have a special role to play in building our business. They have a particular interest in striving for excellence and in helping to build a UAE-born business. Engaging with schools and universities helps us to reach out to individuals who wish to build world-class careers in finance. New hires are able to join us at entry level and benefit from fully developed training schemes. They may also join us at later stages in their careers in senior positions.

Our objective is to increase the number of Emiratis working at dunia. Currently more than 10% of our workforce is Emirati and of those, 66% are female, which also demonstrates our commitment to empowering women in our workforce.

E N G A G E M E N T A N D H I R I N GE N G A G E M E N T A N D H I R I N G

Hiring individuals – of any nationality – is never enough. Our Kawader dunia program presents Emiratis in education with an educational development program built on three pillars:

AL TAMOUH

This is our graduate learning program, providing students with an opportunity to gain real-life experience of working in the financial services industry. Its aim is to build world-class business leaders and commences with a three-month management certification program that is run by dunia.

AL WAAED

Our undergraduate program provides part-time opportunities for students wishing to gain work experience at dunia whilst continuing their studies. The program covers a range of learning modules that include teamwork, marketing, credit and risk management, corporate governance and brand building.

AL NUKHBA

This is our career development program, specifically developed to help grow the careers of experienced, seasoned professionals. These individuals are able to enroll in to our leadership programs and external business school diplomas.

D E V E L O P M E N TD E V E L O P M E N T


. . . F O C U S E D O N E N A B L I N G

S U C C E S S A N D E N R I C H I N G L I V E S

A P A S S I O N AT E A N D

S E A S O N E D T E A M . . .


D E V E L O P I N G W O R L D

C L A S S T A L E N TOur primary strategic focus as a business is on attracting and retaining a diverse group of world-class talent. Hiring, training and retaining the very best people goes hand in hand with achieving customer delight. The expertise and commitment of all our employees is central to our ability to provide all of our customers with the service they deserve and expect. Furthermore, our efforts to truly engage our employees in the business is of paramount importance in driving the innovation of new ideas, fi nancial products and solutions.

We have handpicked professionals, experts, planners and specialists who come together to form the building blocks of dunia. It is our people who bring our core belief to fruition, exemplifi ed in our business promise: ‘We’re different. Guaranteed.’

Corporate sustainability is a big theme of late. From your experience, how does sustainability tie in with management practice and standards?

Students must be cognisant of the culture of a company before they make a decision on whether or not to join it. Would you want to join a hierarchical company where rules are established and rigid and your voice is one of thousands, or a dynamic company with open doors where you are involved in setting the standards that encourage fresh ideas and challenges you professionally and personally to take risks to grow? Culture is created top-down and at every level thereafter and companies that nurture talent attraction, acquisition, engagement and development already have a foot in the door to their future.

Nurturing MBA talent has always been close to your heart, right from your days at Citi. Why do you feel it is so important? What role is it playing at a young company like Dunia Finance?

The primary guiding principle I operate by is that people are hired for careers and not jobs. Graduate development programmes for MBAs are the best example of a win-win situation: the MBA graduate receives cross-functional training, sometimes across countries and is fast-tracked into a leadership role, and the company gets to build its management team of the future. The Dunia Associate programme for MBAs operates on the same lines; we make a substantial investment to help accelerate the learning curve of the diverse high potential talent selected, and the associates develop critical leadership and operating skills through handling complexity, accountability and problem solving through on-the-job assignments.

We also believe that building a career path is about taking chances (employee responsibility) and providing opportunities (organization responsibility). With developing and retaining existing talent being one of our prime focal points as a young company, we have established various programmes like the Management Resource Inventory (MRI) programme for high-potential staff, for whom specialised development action plans (DAPs) are developed annually; the 9 box grid, an individual assessment and feedback tool for employees and managers and team challenges to identify and implement innovative ideas; cross functional rotation and mentoring programmes. These programmes link perfectly with our belief that education, training and development actions are the best way to empower people, enable their success and in turn enrich the lives of individuals, employers and the other stakeholders of society.

As an MBA, would you say that an MBA is worth the investment?

An MBA, if done well, serves as an accelerated development and potential enhancement source for talent, and hence is defi nitely recommended. Most school and college curricula are directed towards learning to improve performance, whereas an MBA is more specifi cally focused on enhancing potential. An MBA from a reputed institution adds more value as the self-selection process ensures that students become part of a cohort with similar potential, which is necessary to bring out the best in them.

However, it is important to remember that the MBA is not a guarantee for success, and students can benefi t from it only if it is done for the right reasons. In today's ever-evolving world, a manager plays the role of a communicator, spokesperson, executor, planner, motivator, resource allocator and leads from the front, recognises millions of pieces of data available and gleans through them effectively to choose those that drive a decision choice.

An MBA can help round off and groom a person with the right aptitude to learn these skills and become an effective practitioner and build a diverse network of colleagues and friends that is necessary to succeed in the business world today.

Source : Financial Times, MBA Blog

THE IMPORTANCE OF DEVELOPING STAFF TALENT: AN INSIDER'S VIEW HOW IMPORTANT IS IT TO DEVELOP STAFF TALENT?

MBA blogger Veena Viswanathan asks Rajeev Kakar, Managing Director & Chief Executive Offi cer of Dunia Finance UAE for his opinion March 25th, 2014 8:11 am by Veena Viswanathan, INSEAD

Recruitment season is in full swing at INSEAD and a noticeable trend has been the proliferation of graduate programmes specially designed for MBAs. Earlier a hallmark of leading banks and consulting fi rms, these programmes are now offered by companies as diverse as Google, Amazon, Emerson, Nissan, L'Oreal and Microsoft.

The programmes typically range from two to fi ve years where you rotate between various areas in the company, even across countries, depending on the company and the specifi c programme that it offers.

I had an interesting chat with Rajeev Kakar, Managing Director & CEO of Dunia Finance, UAE and an MBA from the Indian Institute of Management, Ahmedabad, on the importance of developing staff talent and grooming MBAs as future leaders.

Mr.Kakar is on the Global Advisory Board of the University of Chicago's Booth School of Business. In his previous role at Citibank as regional chief executive of Turkey, Middle East and Africa, he played an instrumental role in developing the Citibank Graduate Management Associate programme in the Middle East.

As an employee at Dunia Finance before leaving for Insead, I had already witnessed the growth of a graduate development programme where more than 40 MBA graduates had been hired into various roles in sales, operations, fi nance and credit risk.

Given how Dunia Finance launched a day after Lehman Brothers declared bankruptcy in 2008, how big a role do you think a talented, well-seasoned team plays in the survival and growth of a company?

We launched our business during a period when the fi nancial world was in turmoil and the future looked very uncertain. Adversity brings about a resilience in people that cannot be measured or explained; while many would have been deterred by the challenges of such an environment, our team saw it as the opportunity of a lifetime. Without a seasoned, talented and highly charged team, it would have been impossibly diffi cult to adapt quickly and recalibrate our models to the newly changed environment and open our doors for business at a time when many others were closing theirs. For us, talent is the only true differentiator. Several key members of our original launch team are still with us, celebrating milestones as a family.

FINANCIAL TIMES

Reproduced from Financial Times Blog (http://blogs.ft.com/mba-blog/2014/03/25/the-importance-of-developing-staff-talent-an-insiders-view)


LEVEL 3ORGANIZATIONAL /

PROFESSIONAL SUCCESSBeing more effective

LEVEL 4LEADERSHIP

Accelerating growth & organizational success

LEVEL 2FUNCTIONAL

Delivering business objectives

LEVEL 1COMPLIANCE

Adherence to regulatory guidelines

Supporting the development of each and every employee at dunia is the ‘dunia Training Academy’. The academy was established in order to create a center of excellence and a focal point for all training and developmental needs. The academy’s objective is to provide a tailored training program for each individual, whose needs are carefully assessed and whose skill sets are augmented through regular training programs. The academy also runs regular certification programs aimed at building the employees' functional expertise.

The dunia Training Academy provides a structured development program for each individual, no matter what his or her level of seniority. The four phases of training are:

• Compliance Adherence to regulatory guidelines• Functional Delivering business objectives• Organizational / Professional Success Being more effective• Leadership Accelerating growth & organizational success

Each of the four phases of training have specific areas of focus depending upon the seniority of the individual.

D U N I A T R A I N I N G A C A D E M YD U N I A T R A I N I N G A C A D E M Y

We focus on a number of core areas of development that we believe help each individual to achieve their own goals and aspirations whilst also nurturing the concept of teamwork and shared values. These include:

• Functional training to improve performance

• Development training to increase potential, such as leadership programs

• Diversity through mirroring our internal staff with that of the general population

• Excellence training to ensure problem-free, competent and timely management of customer requests

We believe that strength lies in unity. Pursuing teamwork through a collective vision and shared values is the key to succeeding – and sustaining success. We work hard towards building a culture of shared rewards and a shared attitude towards how we engage with our customers. Great teamwork delivers great results for all of our customers and the wider community. At the very center of our ideology is the belief that greatness comes from unity, shared visions and the power of one team. Teamwork is why we have built a strong, responsible business and it is teamwork that will help us reach greater heights as we reach for the stratosphere.

T E A M W O R KT E A M W O R K

T R A I N I N G A N D D E V E L O P M E N T T R A I N I N G A N D D E V E L O P M E N T

I have been with company for more than 6 years now and there is always opportunity to learn at dunia. Open door policy and family-like atmosphere helps you to network with everyone in the offi ce. I also love the fact that dunia values and rewards initiative. The vision of the company is unique and the senior management understands the need to invest in people. I feel empowered and supported by management to make positive changes. The company takes its culture and values seriously and is the best fi nancial services company and startup with a strong culture of "doing things differently”.

Pavan Shah, Financial Center Head

My career prior to dunia involved two 100+ years’ old storied institutions (Citigroup and GE) and it was quite a change to move to one yet formed. Looking back, it has been a fantastic journey over the past 7 years to see dunia grow from an 'idea' to an 'institution' which is now amongst the best regarded and recognised brands. Along the way has been incredible learning, disruptive business models in a world reshaped by the fi nancial crisis of 2008-09, confi dence in aspiring for the highest standards and the pleasure of working with some of the nicest & smartest people. It has been an absolute pleasure and a privilege.

P Ganapathi, dunia Treasurer

Having been part of dunia’s launch team, I feel as though dunia and I have grown up together with the company. Over the last fi ve years, my career growth has accelerated tenfold, my exposure to industry stalwarts, innovative ideas and challenges has been exponential, and my learning curve continues to climb every year. Last year, dunia recognized my need for personal growth and development by giving me time off to complete my MBA full time at INSEAD in France. The support extended to me by dunia has been invaluable and is an affi rmation of its commitment to invest in continued development of its staff, and has reinforced my belief that people are the true differentiator here. Proud to be part of the dunia family.

Veena Viswanathan, Current MBA Student at INSEAD on education leave from dunia


R E L E N T L E S S F O C U S . . . . . . O N S E R V I N G O U R

C U S T O M E R S


The dunia team is made up of 31 nationalities speaking 44 languages, bringing together a vast array of cultural experiences and experiences. We believe this extraordinary level of diversity is enormously positive because we firmly believe that all experiences are valid and all voices should be heard.

It is this commitment to listening that forms the backbone of our employee engagement program. We have built an open and participative culture in order to facilitate the free flow of thoughts and ideas. This is enormously important in pursuing product and service innovations.

dunia CredoWe believe in…

CUSTOMER COMMITMENTWe reach out to our customers proactively and build meaningful relationships that make a positive impact in their lives. Our commitment is realized through listening and understanding their needs, and in the design and delivery of quality products and services. We treat them fairly and with respect.

VALUE OF OUR PEOPLEWe have empathy, mutual respect, trust and unconditional support for each other. We recognize the leadership potential in every individual and provide opportunities to learn and grow. We are a results-oriented team and work together to achieve our goals and enable success.

SERVING THE COMMUNITYWe serve our community by respecting their traditions and enriching their lives through our work, spirit of volunteering and resources. We are a responsible player and believe action is better than words.

STRIVING FOR EXCELLENCEWe have a passion to excel and strive for excellence in all that we do. We succeed when we have exceeded customer expectations. We encourage creativity and innovation and always “THINK BIG” to maximize our potential.

INTEGRITY AND ETHICSIntegrity and ethics are at the core of our value system and embedded in all that we do. We uphold dunia’s reputation with pride, and conduct our business with all stakeholders, customers and regulators with the highest ethical standards and transparency. We are accountable for our actions.

S T R E N G T H T H R O U G H

D I V E R S I T Y


W O R K I N G A S

A T E A M . . .

. . .W I T H T H E B E S T A N D

T H E B R I G H T E S T

As an equal opportunity employer, dunia is committed to the fair representation of all segments of society. We also recognize that we have a special responsibility to nurture and support the careers of female employees across all positions in our business. Moreover, women bring a fresh balance to our business approach, decisions and modes of execution. With their growth, society grows as a whole.


The Sheikh Zayed Grand Mosque was initiated by the late president of the United Arab Emirates, HH Sheikh Zayed bin Sultan Al Nahyan, who wanted to establish a structure which unites the cultural diversity of Islamic world, the historical and modern values of architecture and art.

The mosque was constructed from 1996 to 2007. It is the largest mosque in the United Arab Emirates and the eighth largest mosque in the world. The mosque is large enough to accommodate over 40,000 worshipers.

The Sheikh Zayed Grand Mosque's design and construction "unites the world", using artisans and materials from many countries including Italy, Germany, Morocco, Pakistan, India, Turkey, Malaysia, Iran, China, United Kingdom, New Zealand, Greece and United Arab Emirates.

R A D I AT I N G

B R I L L I A N C E

Source: http://en.wikipedia.org/wiki/Sheikh_Zayed_Mosque SHEIKH ZAYED GRAND MOSQUE


E M P O W E R I N G A N D E N A B L I N G

C U LT U R E . . .

. . . B R I N G I N G O U T

T H E B E S T


S H A P I N G F U T U R E L E A D E R S

In May 2013, dunia launched a new initiative entitled The Dunia Young Business Leaders Program, which now continues to be part of dunia's annual calendar. The aim of the initiative is to equip ambitious young people with the skills and knowledge required to become future business leaders. Taking place over three weeks, the Program enrolls fi rst and second year university students, as well as year 11 and 12 high school students. This intensive and thorough program of workshops, lectures, seminars, presentations and roundtables provides individuals with an insight in to what it takes to become a successful entrepreneur. It also focuses on what is required in order to establish a business, grow and lead a company, capitalize on opportunities and how to build a business that is sustainable and socially responsible.

We believe that we have a role to play in equipping young people in the UAE with the skills and knowledge needed to set up their own businesses – and to inspire young people to become entrepreneurs. As the UAE looks to further diversify its economy, a key national objective is to create a talented, robust and ambitious workforce. Our program aims to help develop an eco-system that grooms young business leaders and entrepreneurs.

D U N I A Y O U N G B U S I N E S S L E A D E R S P R O G R A MD U N I A Y O U N G B U S I N E S S L E A D E R S P R O G R A M


G R O W I N GS T E A D I LY


YAS MARINA CIRCUIT ABU DHABI GRAND PRIX

The Yas Marina Circuit is the venue for the Abu Dhabi Grand Prix. The circuit is situated on Yas Island, about 30 minutes from the capital of the UAE, Abu Dhabi. The circuit has fi ve grandstand areas and part of its pit lane exit runs underneath the track. It also houses a team building behind the pit building, Media Center, Dragster Track, VIP Tower and Ferrari World Theme Park. Yas Marina Circuit is the largest permanent sports venue lighting project in the world. Facts:• Seating Capacity – 41,093• Area – 161.9 ha• Length – 5.5 km

S P E E D I N G

A H E A D

Source: http://en.wikipedia.org/wiki/Yas_Marina_Circuit


W O R L D C L A S S G O V E R N A N C E

AT T H E H E A R T O F A L L W E D O

Since we launched in 2008, we have operated transparently, incorporating world-class governance and compliance practices in to every element of the Company’s operations - from human resources to accounting, regulatory compliance and risk. All of our internal and external processes and policies are designed to put our systems of governance on par with global best practice.

Our collective belief is that transparency and openness leads to better decision-making, more robust risk management and better business outcomes. dunia adheres to a number of governance and compliance protocols, including:

• IFRS (International Financial Reporting Standards)• IAASB (International Auditing and Assurance Standards)

dunia is governed by a two-tier system of governance committees: the Executive Management Committee and the Board Committees. Both tiers take responsibility for executing dunia’s corporate duties, while ensuring the organization is run in an entirely transparent, ethical manner that meets all legal requirements. When dunia was launched, we chose to voluntarily adhere to a range of global, regional and local best practices that have been used by other leading financial institutions around the world.

The company’s governance framework has four key pillars:

• Strategy• Compliance• Performance• Accountability

The Board Committees are made up of four distinct committees:

• Board• Risk Management Committee• Audit Committee• Employee remuneration and nomination committee

These four committees are responsible for ensuring that all systems, checks and balances are met across the entire organization. The Executive Management Committees drill down deeply in to every aspect of the organization’s operations including:

• Assets and liabilities• Business risk and compliance• Credit risk• Product development• Operating review• IT steering• Human resources• Vendor management

dunia has policies in place that robustly safeguard the businesses financial strength, sharply focusing on risk management, compliance, code of conduct and internal auditing.

I N T E R N A L P R O C E S S E SI N T E R N A L P R O C E S S E S


dunia’s approach to risk is based primarily on the need for capital preservation and high impairment provisions through the protection of a strong balance sheet and liquidity. Analytics is used, helping dunia assess the impact of its credit lending criteria on an ongoing basis.

Treating Customers Fairly (TCF) is a policy framework that means that the Company is committed to providing all customers with financial products that meet their specific needs: lending fairly and responsibly. The TCF framework also ensures that customers are sold products in a fair and transparent manner with full disclosure of terms & conditions.

This code of conduct not only aids the avoidance of risk but also acts as a platform for customer service excellence, which in turn assists dunia in retaining its customer base. The TCF policy also includes a customer service promise that is overseen by the Senior Management Team: every single customer complaint across all channels – social media, letters, emails or telephone are personally handled and resolved. Our commitment to resolving all potential customer issues forms an important part of our risk avoidance framework.

R I S K P H I L O S O P H YR I S K P H I L O S O P H Y

dunia’s accounts are audited annually by its external auditors. We have, however, built an internal auditing policy that is overseen by our own Audit Committee. The Committee aims to provide assurance to all stakeholders, the Board and CEO on the adequacy and effectiveness of the control environment by conducting a series of assurance reviews. It also aims to build a strong awareness of risk across the organization so that the Board and CEO are fully appraised at all times of the risk/control balance.

Each business unit is assessed for risk on an ongoing basis and their respective reviews are approved by the Audit Committee. Business unit reviews ensure that every corner of the business is fully – and regularly – audited so that the whole organization complies with legal and regulatory requirements. Reviews also assess Business units’ delivery on our core customer promise, ensuring that all customer service requirements are met.

A U D I T I N GA U D I T I N G

The management of risk is at the heart of dunia’s governance policy. Responsible lending underpins dunia's operations, forming a central tenet of our unique approach. It is also what has enabled us to build a business that is incredibly well leveraged.

dunia has three lines of defense against risk, providing a robust and incredibly thorough policy of protection. As a first line of defense, each business unit is responsible completing a self-assessment process. The Risks and Controls Self-Assessment (RCSA) mechanism helps each business unit to identify any potential risk factors on a day-to-day basis. RCSA reviews are held on a regular basis and any potential breaches are directly forwarded to management for review and intervention.

M A N A G I N G R I S KM A N A G I N G R I S K


Our second line of defense rests with a matrix of committees that are each given a specific mandate. These include the Business Risk and Compliance Committee (BRCC), Assets and Liabilities Committee, Vendor Committee for Procurement, Technology Steering Committee, Credit Risk Committee, HR Committee for Employee Matters and finally, the Service Committee for customer issues.

Furthermore, a process of monthly proofing enables the Chief Financial Officer to provide assurance that the company’s assets are valued correctly. The company’s third line of defense is the Internal Audit Committee.

Business Cases on dunia written by Singapore Management University• 2013: "The birth of dunia (B) : Time to actively start lending"Source: http://www.thecasecentre.org/educators/products/view?id=116598#.UoMjqeMOH_o.google_plusone_share

• 2012: "The birth of dunia (A)"Source: http://ink.library.smu.edu.sg/cases_coll_all/10/

A N O T H E R C A S E S T U D Y B Y S I N G A P O R E M A N A G E M E N T A N O T H E R C A S E S T U D Y B Y S I N G A P O R E M A N A G E M E N T

U N I V E R S I T Y R E C O G N I Z E S D U N I A F O R B U S I N E S S U N I V E R S I T Y R E C O G N I Z E S D U N I A F O R B U S I N E S S

E X C E L L E N C EE X C E L L E N C E

C O N T I N U O U S R E C O G N I T I O N

F O R E X C E L L E N C E


. . .T H R O U G H R E L E N T L E S S

I N N O VAT I O N

R E L E N T L E S S F O C U S O N

E X E C U T I O N E X C E L L E N C E . . .


dunia’s sustainability platform is based on the GRI4 index, the Global Reporting Initiative. These internationally accepted guidelines enabled us to build a robust, world-class sustainability framework that allows us to measure and report on our economic, environmental and social performance.

We believe that the best run companies are those that embrace the ‘triple bottom line’. This measures not only profi ts but also the impact that our activities have on people and the planet. The basis for this belief is straightforward: every company has a responsibility not only to its shareholders and employees but also to people and the planet. The three bottom lines that we assess from a sustainability perspective are:

PEOPLE

Every operational decision taken at dunia is assessed against the impact that it may have on the people, the company, and its actions touch upon: our staff, our shareholders and the wider community.

PROFIT

Profi tability enables all businesses to grow and create jobs, which is a major benefi t to society. Profi table organizations may also be less likely to cut corners and we believe that by being profi table we are able to invest in systems and processes that protect the business, protect jobs and safeguard the people and planet around us.

PLANET

We have implemented many green initiatives to help protect the environment. These include reducing our own ecological footprint through compact branches, recycling, automation, waste reduction and the active promotion of energy saving tactics such as energy-effi cient lighting.

SUSTAINABILITY HIGHLIGHTS IN 2013

• 2.6 tons of paper waste were collected and recycled by dunia staff

• 95% of dunia customers receive e-statements instead of paper statements

• All internal departments fi le their records electronically – we are working hard to become a paper-free organization

• Maintained our record of having committed no violations of environmental laws or regulations since inception

• dunia Cares – our overarching corporate social responsibility program

P E R F O R M I N G W I T H E X C E L L E N C E

C A R I N G W I T H P A S S I O N

dunia’s Corporate Social Responsibility program, dunia Cares focuses on lending a helping hand to positive and sustainable causes that include public health, the environment, education and improving social conditions. Our aim is to make a difference where it really counts: at a grassroots level, where people and communities need the most support.

The dunia Cares pledge is to help other people with sincerity, to make a meaningful difference, enrich lives, empower people and enable success. The program’s objective is to continually live out our credo, to be a responsible corporate citizen, to promote active participation in community initiatives and enrich lives through people and our environment.

We focus on a few key pillars: social enhancement, the promotion of good health and wellness, raising education standards, encouraging environmental sustainability and building new community partnerships. dunia staff volunteered over 13,600 hours during 2013 towards community initiatives…

A V O I C E I N T H E C O M M U N I T YA V O I C E I N T H E C O M M U N I T Y

We are relentlessly focused on empowering people, enabling success and enriching the lives of our customers and those in the wider community. As part of fulfilling our responsibilities to all our stakeholders, we believe that we can make a contribution to saving the future of generations to come by making our communities and environment a sustainable place to live. At dunia, we think about the impact we have on our staff and the wider community in everything we do and we consider everyone’s wellbeing.

Our strong growth will fuel the growth and development of our people and this in turn will drive the economic growth and prosperity of our community. The Sustainability Committee meets on a quarterly basis to discuss issues of social and environmental significance and identify areas where dunia can contribute more to the community and the environment and continue making a difference.

Giving back to those in need during the Holy month of RamadanWe distributed more than 2500 iftar meals to those less fortunate.

National blood donation driveIn 2013, we rolled out our ninth blood donation awareness campaign, spreading the important message that giving blood saves lives. This is a cause that dunia staff and customers consistently support. In 2013, our campaign captured enough blood to save the lives of 2600 people.

Shoebox AppealIn 2013, we collected 144 shoeboxes containing more than 3,200 items for construction laborers in UAE, containing basic day-to-day necessities.


C O N S TA N T LY D E V E L O P I N G

TA L E N T. . .

. . . C R E AT I N G

F U T U R E L E A D E R S


The Harvard Project for Asian and International Relations (HPAIR) is a student run organization of the Harvard University Faculty of Arts and Sciences. HPAIR organizes annual conferences around the world to create a platform for discussion of the key social, economic and political issues relevant to the Asia Pacific region. The HPAIR 2013 Asia Conference in Dubai brought together future and current leaders from around the world to engage in a five-day dialogue, addressing the events that have helped to shape the current status of Asia on the world stage.

The conference theme was: ‘Extending Horizons: Charting Asia’s Flourishing Future’. During the conference, dunia’s Managing Director and CEO, Rajeev Kakar, engaged with the students on the topic and delivered the closing address at this prestigious conference held in August 2013.

M O T I V A T I N G Y O U T HM O T I V A T I N G Y O U T H

Women are among the fastest-growing groups of entrepreneurs today. Despite the enormous economic contributions of this group, female entrepreneurship remains under-explored and inadequately covered in the MENA region.

Mariam Elsamny, Chief Marketing Offi cer, Dunia Finance, and also on the alumni board for the University of Chicago Booth School of Business, worked with the team to bring together a conference

• Highlight key fi ndings of international and regional research on women entrepreneurship • Discuss some fi rst-hand experiences of pioneering female entrepreneurs in MENA • Address current gaps in policy and execution and suggest key steps in defi ning the way forward

to empower women entrepreneurs in the MENA region

The conference was held in January 2013 and a white paper was issued thereafter in conjunction with The Ideation Center of Booz & Co.

Inspiring entrepreneurship

Mariam Elsamny, Chief Marketing Officer for dunia, has been actively involved in mentoring young women through the “Reach” program on how to enhance their entrepreneurial and business skills. Reach is a non-profit organization incorporated in the DIFC in UAE, which is designed for mentoring and supporting females in the UAE as they progress through their careers. The mentoring relationship focuses on teaching, empowering, counseling and supporting these young females so that they can perform even better in their day to day lives and contribute positively to society.

E M P O W E R I N G W O M E NE M P O W E R I N G W O M E N

L E A D E R S H I P T H R O U G H I N F L U E N C E

A group of students from SP Jain School of Management visited dunia to see for themselves the real life depiction of what they had read in a case study on dunia - The Birth of dunia (B): Time to actively start lending – written by Singapore Management University. The interaction gave the students great insight into what they had already read and studied in the case study.

dunia Touch is a unique social volunteer program made available to you by dunia, in collaboration with leading community service firms which have an established track record of social entrepreneurism programs through the spirit of volunteerism. Our unique social volunteering program, developed in collaboration with leading community service firms – continued in 2013.

SP Jain students during a visit to the dunia office, engaging with the management team and key executives

B E I N G R O L E M O D E L S

E N R I C H I N G L I V E SE N R I C H I N G L I V E S


F O C U S , E N E R G Y, P A S S I O N . . . . . . C R E AT I V I T Y, I N N O VAT I O N

A N D E X E C U T I O N E X C E L L E N C E


S O A R I N GT O N E W H E I G H T S


F O L L O W I N G T H E S U C C E S S O F 2 0 1 2 , D U N I A H A S D E L I V E R E D A N O T H E R

Y E A R O F R E C O R D F I N A N C I A L P E R F O R M A N C E I N 2 0 1 3 – A C H I E V I N G

S T R O N G R E V E N U E G R O W T H W I T H F U R T H E R I M P R O V E M E N T S I N O V E R A L L

O P E R AT I N G E F F I C I E N C Y A N D P O R T F O L I O C R E D I T Q U A L I T Y – R E S U LT I N G

I N A F U L L - Y E A R N E T I N C O M E O F A E D 1 1 8 . 5 M L N I N 2 0 1 3 ( C O M P A R E D T O

A E D 7 3 . 4 M L N I N 2 0 1 2 ) .

This 61% increase in net income in 2013 reflects a robust and highly broad-based performance across all financial metrics and key performance indicators – specifically covering revenue, expenses, cost of credit and return on equity, and across the key efficiency ratios of cost-income, operating leverage, risk adjusted yields and loss absorption capacity.

Additionally, growth in loans and advances to customers remained selective, prudently paced and predominantly self-funded through customer deposits, to ensure performance predictability and sustainability of earnings in the highly volatile and challenging macro-economic environment prevailing throughout 2013.

dunia’s performance in 2013 was primarily driven by the strong growth momentum in its top-line, with revenue and balance sheet growth being underpinned by the success in selectively acquiring new customers, deepening existing customer relationships, and driving cross-sell to maximize value creation through deeper and more focused customer relationships.

The anticipatory measures implemented by Management in recent years to safeguard the business and deliver predictable results in a stressed operating environment continue to impact positively on dunia’s business performance in 2013. These strategic realignment measures include tight customer selection criteria, focus on increasing secured assets, risk-adjusted pricing, self-funding growth through customer deposits, strategic cost management, prudent impairment provisioning, and incremental value addition by diversifying into new lines of business.

dunia’s robust financial performance was further driven by several strategic initiatives such as: the introduction of innovative products to raise customer deposits, enhancement of the existing product suite and diversifying fee-based revenue sources; expanding distribution capabilities (both proprietary and through alliances), and continued focus on raising granular, tenured and lower-cost customer deposits to self-fund business growth.

While dunia has achieved record profitability in 2013 and the underlying business momentum remains strong across all performance parameters, there are incremental strategic initiatives in the pipeline which, in addition to the above-mentioned factors already in play, have positioned dunia for stronger growth in 2014 and beyond.

dunia achieved its third year of profitability in 2013 with net income of AED 118.5 Mln (which is AED 45.1 Mln, or 61.4%, higher versus 2012), and delivered a return on equity of 28.9% p.a. (25% higher versus 2012).

This strong y-o-y performance in 2013 was driven by high double-digit top-line growth (customer base by 21.3%, loans and advances to customers by 35.4%, customer deposits by 24.4%, revenue by 25.8% and operating expenses by 16.1% over 2012.

Reflecting continuously increasing cost efficiencies and further improvements in portfolio credit quality in 2013, cost-income ratio reduced to 42.2% from 48.3% in 2012 and cost of credit ratio reduced to 9.9% from 10.8% in 2012.

While the y-o-y financial performance in 2013 was strong, over a four-year period from 2009 to 2013 dunia’s customer base has grown at a CAGR of 48%, loans and advances to customers by 56%, customer deposits by 100%, and Revenue by 67%.

In a short span of 5 years since commencement of business, dunia’s customer base has grown to 137.8k in 2013 – representing a 21.3% increase vis-à-vis 2012. This double-digit customer growth was driven by several factors, such as: strong acquisition momentum of new customer relationships from dunia’s proprietary and partner channels; geographical expansion to new emirates and to new catchment areas within existing emirates; opening new customer segments and rolling out new products and services; and improvements in productivity and efficiency of the sales and distribution infrastructure; and the increased acquisition through e-channels, social media tools and mobile phone based channels.

While dunia’s y-o-y results in 2013 illustrate strong delivery on all financial performance metrics, the subsequent sections provide a more comprehensive analysis of underlying performance trends across key business drivers, to facilitate and enable a better understanding of dunia’s performance trajectory and business momentum expected in 2013 and beyond.

• Third year of profitability, with net income of AED 118.5 Mln (61% y-o-y improvement)

• AED 17.6 Mln (AED 32 per share) dividend proposed for 2013 (third year of dividend track record)

• 21.3% y-o-y growth in customer base, to 137.8k customers

• 35.4% y-o-y growth in net loans and advances to customers, to AED 1,025.3 Mln

• 24.4% y-o-y growth in customer deposits, toAED 515.1 Mln

• 25.8% y-o-y growth in revenue, to AED 353.9 Mln

• Cost-income ratio further reduced to 42.2% (resulting in 15.9% positive operating leverage)

• 8.8% y-o-y improvement in cost of credit, to 9.9% p.a.

• 17.7% y-o-y improvement in loss absorption capacity, to 2.4x

• 2.4% ratio of impairment reserves to net loans and advances (vs. statutory minimum of 1.5%)

• 25.0% y-o-y improvement in return on equity, to 28.9% p.a.

K E Y F I N A N C I A L K E Y F I N A N C I A L

H I G H L I G H T S I N 2 0 1 3H I G H L I G H T S I N 2 0 1 3

F I N A N C I A L T R E N D S

Amounts(in AED Mln) 2009 2010 2011 2012 2013 2013 vs. 2012

B/(W)2013 vs. 2012

% B/(W)2013-2009

CAGR

Customers (‘000s) 28.9 57.7 88.6 113.6 137.8 24.2 21.3% 48%

Loans & Advances to Customers 173.1 356.7 555.9 757.2 1,025.3 268.1 35.4% 56%

Customer Deposits 32.2 74.1 241.6 414.0 515.1 101.1 24.4% 100%

Revenue 45.6 106.0 205.5 281.4 353.9 72.5 25.8% 67%

Operating Expense 136.6 151.7 133.2 135.9 149.3 (13.4) (9.9%) 2%

Net Income (116.5) (87.8) 18.1 73.4 118.5 45.1 61.4%

Operating Expense % 141.1% 54.9% 28.1% 20.4% 17.1% 3.3% 16.1%

Cost / Income % 299.4% 143.1% 64.8% 48.3% 42.2% 6.1% 12.6%

Cost of Credit % 26.3% 15.3% 11.5% 10.8% 9.9% 0.9% 8.8%

Return on Equity % (32.7%) (29.2%) 6.7% 23.1% 28.9% 5.8% 25.0%

2 0 1 3 S U M M A R Y F I N A N C I A L S

C U S T O M E R S A N D L O A N S & A D V A N C E S T O C U S T O M E R SC U S T O M E R S A N D L O A N S & A D V A N C E S T O C U S T O M E R S

S T R O N G T O P - L I N E G R O W T H


Total loans and advances to customers have increased to AED 1,025.3 Mln in 2013 – representing a 35.4% growth compared to 2012. Overall growth in loans and advances to customers was underpinned primarily by dunia’s success in selectively acquiring new customers, deepening of existing customer relationships through cross-sell to increase product penetration per customer and by ensuring a loyal and growing customer base.

These targeted efforts to maximize customer relationship value were implemented in-line with dunia’s “test, grow and accelerate” approach, and facilitated through extensive leverage of dunia’s proprietary strategic analytics capabilities.

dunia generated record-breaking revenue of AED 353.9 Mln in 2013 – representing a robust 25.8% increase vis-à-vis 2012. Revenue growth in 2013 was broad-based and diversified, driven by strong balance sheet growth, healthy yields on loans and advances to customers, steadily increasing income from fees and a stable cost of funds.

In addition to robust y-o-y revenue growth in 2013, the revenue momentum in recent months remains equally strong (Qtr4-2013 revenue of AED 96.9 Mln being 26.2% higher vs. Qtr4-2012; Dec-2013 revenue of AED 31.9 Mln being 21.2% higher vs. Dec-2012) – indicating continued strong forward revenue growth in 2014.

dunia has persistently focused not just on achieving strong y-o-y growth in absolute revenue, but also on building a richly diversified revenue base, through: maintaining healthy yields on loans and advances to customers, implementing risk-tiered pricing to maximize risk-reward balance, and increasing contribution from fee-based revenue sources.

Diversifying the revenue mix enables dunia to build greater resilience to margin compression risks and ensures greater capacity to absorb any sudden volatility in operating or credit costs, while helping achieve strong operating leverage – all critical factors for driving predictable, profitable and sustainable growth.

dunia’s 2013 revenue mix illustrates the success of this strategy – while achieving a 25.8% y-o-y growth in absolute revenue, aggregate yields (interest and fee income) on loans and advances to customers remained at a healthy 39.9% p.a., whereas contribution from fee income remained at a robust 26.6% of total revenue.

R E V E N U ER E V E N U E

R E V E N U E Q U A L I T YR E V E N U E Q U A L I T Y

dunia’s total operating expenses were at AED 149.3 Mln in 2013 – representing a relatively marginal increase of AED 13.4 Mln in absolute expenses vis-à-vis 2012. This relatively flat y-o-y expense trajectory was successfully achieved as a result of the Management’s continuous focus on strategic cost management initiatives, which not only helped in keeping a tight control on absolute expenses, but also enabled maximum utilization of infrastructure and capabilities already built. This ongoing discipline has ensured that top-line growth always exceeds growth in expenses, resulting in strong operating leverage and sustainable profitability.

To illustrate the success of this “spend-smart” discipline, dunia’s 2013 expenses increased at a relatively marginal rate of 9.9% vis-à-vis 2012, whereas its customer base increased by 21.3%, loans and advances to customers by 35.4%, and revenue by 25.8%, in the same operating period.

O P E R A T I N G E X P E N S E SO P E R A TO P E R A T

Customer base increased to 137.8k in 2013(21.3% y-o-y growth)

150

120

90

60

30

03.1

28.9

57.7

88.6

113.6

137.8

2008 2009 2010 2011 2012 2013

Customers(000s)

21% customer growth in2013 vs. 2012

1,125

900

675

450

225

020.5

173.1

356.7

Loans and advances to customers increased to AED 1,025.3 Mln in 2013 (35.4 % y-o-y growth)

173 1

356 7

555.9

757.2

2008 2009 2010 2011 2012 2013

Loans & Advances to Customers(AED Mln)

35% receivables growth in2013 vs. 2012

1,025.3

2013 revenue of AED 353.9 Mln (25.8% higher vs. 2012)

375

300

225

150

75

02008 2009 2010 2011 2012 2013

Revenue(AED Mln)

26% revenue growth in2013 vs. 2012

6.245.6

106.0

205.5

281.4

353.9

Qtr4-2013 revenue of AED 96.9 Mln (26.2% higher vs. Qtr4 2012)

100

80

60

40

20

0Qtr4-09 Qtr4-10 Qtr4-11 Qtr4-12 Qtr4-13

26% revenue growth inQtr4 - 2013 vs. Qtr4 - 2012

15.9

33.7

58.7

76.8

96.9

Dec-2013 revenue of AED 31.9 Mln (21.2% higher vs. Dec-2012)

35

28

21

14

7

0Dec 09 Dec 10 Dec 11 Dec 12 Dec 13

21% revenue growth inDec 2013 vs. Dec 2012

4.9

12.0

20.2

26.3

31.9

G R O W T H I N B U S I N E S S D R I V E R S C O N T I N U E S T O O U T PA C E G R O W T H I N E X P E N S E S

Fees Interest

AED 94.2 Mln of fee income in 2013

375

300

225

150

75

02008 2009 2010 2011 2012 2013

Revenue(AED Mln) 5% growth in fee income

revenue in 2013 vs. 2012

0.37.7

23.1

64.8

89.4

94.2

5.9 37.982.9

140.7192.0

259.7

39.9% p.a yield on loans and advances in 2013

50

40

30

20

10

02009 2010 2011 2012 2013

Yield on Customer Loans & Advances(% p.a.)

Customer assets yield consistently > 35%

35.438.4

40.339.2 39.9

375

300

225

150

75

02008 2009 2010 2011 2012 2013

Expenses(AED Mln)

Flat expense trajectory 2013 - 2009 CAGR 2.2%

120.1 136.6 138.9133.2 135.9

149.3

26.6% contribution from fee income in 2013

50

40

30

20

10

02009 2010 2011 2012 2013

Fee / Total Revenue(%)

Fee / Total revenue > 25%

16.9

21.8

31.5 31.826.6


dunia’s Cost-Income ratio, a key indicator of overall financial and operating efficiency, has further reduced to 42.2% in 2013 – representing a 12.6% improvement compared to 2012. Similarly, dunia’s ratio of expenses to loans and advances to customers, an equally important indicator highlighting economies of scale, has further reduced to 17.1% p.a. in 2013 – representing a 16.1% improvement vis-à-vis 2012.

Both these ratios are a strong reflection of the success achieved in 2013 from the on-going focus on strategic cost management initiatives and the “spend-smart” discipline being followed at dunia - indicating continued strong expense efficiencies in 2014.

E X P E N S E E F F I C I E N C I E SE X P E N S E E F F I C I E N C I E S

C O N T I N U E D I M P R O V E M E N T I N P O R T F O L I O C R E D I T Q U A L I T Y

Credit quality of dunia’s portfolio continues to improve on a y-o-y basis, with the cost of credit ratio on loans and advances to customers reducing further to 9.9% p.a. in 2013 – representing a notable 8.8% improvement over 2012.

This y-o-y improvement in portfolio credit quality continued to be driven by the Management’s strategy of prudently pacing growth in loans and advances to customers, while simultaneously focusing on building a safer and more diversified mix of customer assets. Key elements of this “strategic risk management” approach include: higher emphasis on sourcing a wider range of secured assets, extensively leveraging dunia’s analytics capabilities to support the “test, grow and accelerate” approach, and highly selective sourcing on unsecured lending.

Moreover, dunia’s robust risk management framework covering credit policy, credit operations and collections, and proactive capacity build-up in advance across all risk management related functions collectively enabled the continued success of this strategic risk management approach.

To illustrate, dunia’s cost of credit ratio has improved by 8.8% from 10.8% p.a. in 2012 to 9.9% p.a. in 2013, despite the volatile and challenging macro-economic environment prevailing during the year. In addition to this y-o-y improvement in 2013, the underlying cost of credit trends in recent months indicate continued improvements in portfolio credit quality in 2014, with Dec-2013 cost of credit ratio already at 8.7% p.a.

C O S T O F C R E D I TC O S T O F CC O S T O F C

Operating leverage is defined as the gap between revenue growth and expense growth over a specific time period. A positive reading implies that revenues are growing faster than expenses, which is a basic health-check on sustainability of the business’ profit growth trajectory. Therefore, operating leverage is another key indicator of operating efficiency in a business.

dunia has achieved an operating leverage of +15.9% in 2013, indicating that its y-o-y revenue growth rate far exceeds the rate of growth in expenses.

O P E R A T I N G L E V E R A G E ( J A W S )O P E R A T I N G L E V E R A G E ( J A W S )

The above trends highlight the tight expense discipline and cost controls implemented at dunia since inception, resulting in strongly positive operating leverage in 2013 – as y-o-y expenses are stable on an absolute basis despite continued strategic investments in building long-term capabilities through new products and services, while achieving robust growth in customer base, loans and advances to customers, customer transactions and processing volumes.

Select examples of this on-going strategic cost management approach include: increased focus on front-line hiring (and only for customer-facing and revenue-generating roles), realignment of costs towards the front-end, stretch assignments for senior team through consolidation of roles, rigorous cost renegotiations with external service providers such as IT vendors and landlords, continued tight controls and monitoring on all discretionary expenses and the use of new technology and straight through processing to drive greater efficiency while increasingly becoming a “low cost” provider.

As a result of these sustained efforts on increasing revenue while simultaneously reducing expenses (a “spend-smart” discipline), dunia has achieved continued strong performance in 2013 across key efficiency ratios, such as: cost-income, expense to customer assets, and operating leverage.

S T R A T E G I C C O S T M A N A G E M E N TS T R A T E G I C C O S T M A N A G E M E N T

2013 expense/customers assets reduced to 17.1% p.a. (16.1% lower vs. 2012)

300

240

180

120

60

02009 2010 2011 2012 2013

141.1

50.328.1 20.4 17.1

Expense/Customer receivables(% p.a.)

16% lower expenses/customer receivables2013 vs. 2012

2013 cost - income reduced to sub - 45% (12.6% lower vs. 2012)

300

240

180

120

60

02009 2010 2011 2012 2013

Cost/Income Ratio(%)

13% lower cost/income ratio2013 vs. 2012

299.4

130.9

64.8

48.3 42.2

2013 operating leverage of +15.9% (Consistently positive operating leverage since inception)

9% Lower cost of credit % in 2013 vs. 2012

26.3

15.311.5 10.8 9.9

2013 cost of credit reduced to 9.9% p.a. (8.8% better vs. 2012)

50

40

30

20

10

02009 2010 2011 2012 2013

Cost of Credit(% p.a.)

8% Lower cost of credit % in Qtr4 - 2013 vs. Qtr4 - 2012

Qtr4 - 2013 cost of credit reduced to 9.6% p.a. (7.9% better vs. Qtr 4 - 2012)

50

40

30

20

10


28.4

15.411.8 10.5

9.6

7% Lower cost of credit % in Dec 2013 vs. Dec 2012

Dec 2013 cost of credit reduced to 8.7% p.a. (7% better vs. Dec - 2012)

50

40

30

20

10


25.3

15.4 12.89.3 8.7

16% positiveoperating leverage 2013 vs. 2012

353.9

149.3

375

300

225

150

75

02008 2009 2010 2011 2012 2013

6.2

120.1

45.6

136.6106.0

138.9205.5

133.2

281.4

135.9

Operating leverage(AED Mln) Revenue Expenses %

600

500

400

300

200

100

02013 2012 2011 2010 2009

Consistently positiveoperating leverage

(%)

15.9

627.4

121.3106.0

34.9


L O S S A B S O R P T I O N C A P A C I T YL O S S A B S O R P T I O N C A P A C I T Y

dunia’s total cost of credit comprises of two distinct elements – Specific Provisions (SP) and General Provisions (GP). SP are conservatively booked at 100% of outstanding balance on all customer loans and advances more than 120 days past due. GP are driven by an equally conservative policy of recognizing portfolio impairment provisions based on Net Present Value of cash flows (driven by statistical regression analysis using historic data), consistent with IFRS standards.

Owing to the uncertain and volatile macro-economic environment prevailing since the time of dunia’s launch in September 2008, the Management has consistently adopted a policy of timely recognition of inherent credit losses in the portfolio through GP, which has helped in building adequate loss absorption capacity to insulate the portfolio from inherent as well as unforeseen stresses.

As a result of this prudence, 54% of dunia’s total cost of credit in 2009 consisted of GP, which as expected, have significantly reduced during 2010-2013 period as the portfolio seasoned and overall credit performance improved. Similarly, SP have reduced from a peak of 13.9% p.a. in 2010 to 10.4% p.a. in 2013, which is in-line with the improvements in delinquency flows resulting from the strategic risk management approach.

dunia’s success in building a granular, diversified, and well-balanced portfolio of loans and advances to customers is one of the main factors driving the consistent y-o-y improvement in cost of credit in 2013.

One of the key elements of dunia’s strategic risk management approach is achieving an optimum mix of secured and unsecured assets, and in-line with this approach, the Management has relentlessly concentrated on maintaining the contribution of secured asset backed finance in the overall portfolio of loans and advances to customers.

As a result of this focus, secured asset backed finance represented 27.5% of total new loan value sourced in 2013, to optimize risk-reward leverage and ensure predictability in a stressed and volatile operating environment.

S E C U R E D A S S E T SS E C U R E D A S S E T S

Risk adjusted yields are defined as the net credit margin between the earning capability of a lending portfolio (i.e. revenue yield) and its credit quality (i.e. cost of credit). The quantum of net credit margin illustrates the room available to absorb operating expenses, to be able to deliver a positive return on assets. Therefore, risk adjusted yields are another key indicator of the portfolio’s profitability dynamics.

dunia’s risk adjusted yields on loans and advances to customers have consistently exceeded 25% in the past three years and have stabilized at a healthy 27.8% p.a. in 2013, supported by healthy revenue yields and reducing cost of credit.

R I S K A D J U S T E D Y I E L D S ( R AY )R I S K A D J U S T E D Y I E L D S ( R AY )

dunia maintains a robust 169% NPL cover as of December 2013, which is substantially higher than the market average and provides a healthy capacity to absorb losses, while further insulating the portfolio from inherent credit losses as well as any unforeseen stress events, thereby protecting the business from potential future shocks.

Moreover, as of December 2013, dunia’s impairment reserves stood at 2.4% of total loans and advances to customers less than 120 days past due which is substantially higher than the market average and is very healthy from a risk management standpoint.

These healthy ratios are further reinforced by the y-o-y improvement in delinquency flows and portfolio credit quality based on customer seasoning.

NOTE: In 2013 there was a net release in General Provisions on account of improvement in portfolio quality.

2013 risk adjusted yield at 27.8% p.a. (7.3% better vs. 2012)

50

40

30

20

10

02009 2010 2011 2012 2013

Risk Adjusted Yield (RAY)(% p.a.)

RAY greater than 25%

20.8 23.1 26.3 25.9 27.8

Qtr4-2013 risk adjusted yield at 28.8% p.a. (8.6% better vs. Qtr4 2012)

50

40

30

20

10



11.3

24.5 26.5 28.826.5

Dec-2013 risk adjusted yield at 30.2% p.a. (6.9% better vs. Dec-2012)

50

40

30

20

10



8.2

25.0 26.0 28.330.2

> 25% of Portfolio is secured

Secured assets represent 27.5% of total loan value sourced in 2013

50

40

30

20

10

02009 2010 2011 2012 2013

Secured / Total Loan Value Sourced(%)

8.9

24.4 22.3

31.127.5

2013 Loss Absorption capacity increased to 2.38x (17.7% better vs. 2012)

4

2

0

- 2

- 4

2009 2010 2011 2012 2013

Loss Absorption Capacity(x-times)

18% increase in Loss Absorption Capacity

in 2013 vs. 2012

(3.57)

(1.08)

1.332.02

2.38

CoC of 26% p.a. (of which 54% GP), to insulate the portfolio from inherent as well as unforeseen stresses

CoC reduced to 15.3% p.a. (42% lower vs. 2009), with improving delinquency



CoC reduced to 9.9% p.a. (8.8% lower vs. 2012), with improving delinquency

9.9 14.3

1.41.2

1.0(0.6)

50

40

30

20

10

02009 2010 2011 2012 2013

Cost of Credit (Coincident)(% p.a.)

Specifi c Provision

General Provision

12.0 13.9 10.3 9.8 10.4

9% Lower Cost of Credit % in2013 vs. 2012

26.3

15.3

10.811.5


Prudent liquidity management is one of the fundamental priorities for any financial institution, and ensuring sufficient availability of funding at all times is especially imperative in the highly volatile and stressed macro-economic environment prevailing since the onset of the global financial crisis in 2008.

These fundamental priorities are even more critical for a non-bank financial institution like dunia. Being proactive and fully cognizant of this challenge, the Management has persistently focused on establishing dunia as a deposit-taking institution since its inception, to provide access to multiple sources of long-term stable funding.

As a result of this concerted focus on liquidity risk management,dunia has been successfully established as a depository institution with a rapidly growing base of granular and tenured customer deposits. dunia sources deposits from corporate customers, and also raises deposits through the issuance of Labor Guarantees for its corporate customers (which are cash collateralized).

dunia’s customer deposits have increased to AED 515 Mln in 2013 – representing a significant 24.4% growth versus 2012, and 81.9% of the growth in loans and advances to customers in 2013 was directly funded by growth in customer deposits and retained earnings. In balance sheet terms, customer deposits fund 50% of loans and advances to customers as of December 2013. This is in-line with Management’s strategy to increasingly self-fund business growth through customer deposits, while minimizing reliance on professional funding sources.

Not only have deposit balances grown strongly, deposit customer base has increased by 20% to 1,600+ customers in 2013 – reflecting the strategy to minimize concentration risk on customer funding. Consequently, the average size of customer deposits has remained stable at a healthy AED 0.3 Mln per customer in 2013 – thereby ensuring granularity of deposits to reduce concentration risk.

Other key indicators on the customer deposit portfolio have also improved substantially in 2013, including: average tenor increased to 31 months (from 29 months in 2012) – reflecting the focus on building a stable, long-term source of customer funds, and average cost of funds at 4.9% p.a. (unchanged from 2012) – reflecting the focus on competitive customer deposit pricing vis-à-vis the cost of professional funding.

All the above parameters are a strong indication of dunia’s continued success in building a highly diversified, stable and lower cost customer deposits portfolio. In addition to raising customer deposits, dunia has successfully arranged credit facilities from leading banks, which provide additional liquidity buffers to safeguard the business in the event of any contingency.

P R O A C T I V E L I Q U I D I T Y R I S K M A N A G E M E N T S T R O N G V A L U E C R E A T I O N A N D S H A R E H O L D E R R E T U R N S

Operating margin is defined as the difference between revenue and operating expenses. The quantum of operating margin illustrates the cushion available to absorb cost of credit, to be able to deliver a profit. Therefore, operating margin is one of the key indicators of a business’ operating profitability.

dunia’s operating margin has increased by 41% to AED 204.5 Mln in 2013, driven by 25.8% revenue growth. Additionally, the underlying momentum in recent months remains strong as well (Qtr 4-2013 margin of AED 50.6 Mln being 17.1% higher vs. Qtr 4 - 2012), indicating continued strong growth in operating margin in 2013.

O P E R A T I N G M A R G I NO P E R A T I N G M A R G I N

N E T I N C O M EN E T I N C O M E

dunia has delivered its third full-year of profitability with a net income of AED 118.5 Mln in 2013 – representing a 61.4% improvement over 2012. As highlighted in preceding sections, this record year of financial performance was driven by strong revenue growth, marginally increasing operating expenses and improving portfolio credit quality.

While the bottom-line has improved 61.4% on full-year basis in 2013, the underlying momentum on profitability in recent months remains strong as well (Qtr 4-2013 net income of AED 27.1 Mln being 12.5% higher vs. Qtr 4-2012) – indicating continued strong profitability growth in 2013.

24% deposit growth in2013 vs. 2012

Customer deposits increased 24.4% to AED 515 Mln in 2013

p g550

440

330

220

110

02009 2010 2011 2012 2013

Deposits(AED Mln)

515

414

242

7432

41% higher margin in2013 vs. 2012

2013 operating margin of AED 204.5 Mln(40.6% higher vs. 2012)

g g300

200

100

0

(100)

(200)2009 2010 2011 2012 2013

Operating Margin(AED Mln)

(91.0)(45.7)

72.3

145.5204.5

2013 net income of AED 118.5 Mln (61.4% higher vs. 2012)

150

100

50

0

(50)

(100)

(200)2009 2010 2011 2012 2013

Net Income(AED Mln)

(116.5)

(87.8)

18.1

73.4

118.561% Net Income

improvement in 2013 vs. 2012

Qtr4-2013 net income of AED 27.1 Mln (12.5% higher vs. Qtr4-2012)

50

30

10

0

(10)

(30)

(50)Qtr4-09 Qtr4-10 Qtr4-11 Qtr4-12 Qtr4-13

(32.0)

(14.3)

10.524.1 27.1

12% Net Income improvement inQtr4 - 2013 vs. Qtr4 - 2012

Increasing granularity through lower deposit ticket size

Average deposit ticket size stable at AED 0.3 Mln

g g y1.5

1.2

0.9

0.6

0.3

0.02009 2010 2011 2012 2013

Average Ticket Size(AED Mln)

1.5

0.50.3 0.30.3

Stable Cost of Funding

Average cost of deposits stable at 4.9% p.a.

g10

8

6

4

2

02009 2010 2011 2012 2013

Average Interest Rate (% p.a.)

4.9 4.9 4.95.2

4.9

Increasing tenure

Average deposit tenure increased to 31 months

g60

48

36

24

12

02009 2010 2011 2012 2013

Average Tenure(Months)

2329 31

15 18

17% higher margin inQtr4 - 2013 vs. Qtr4 - 2012

Qtr4-2013 operating margin of AED 50.6 Mln (17.1% higher vs. Qtr4-2012)

g g100

70

40

0

(20)

(50)Qtr4-09 Qtr4-10 Qtr4-11 Qtr4-12 Qtr4-13

(20.6)

(1.4)

26.2

43.250.6


In-line with the robust performance across all measures of the top-line and bottom-line, dunia has delivered a full-year ROA of 12.4% p.a. and ROE of 28.9% in 2013 – representing a substantial 28.6% ROA improvement and 25.0% ROE improvement vis-à-vis 2012.

R E T U R N O N A S S E T S ( R O A ) & R E T U R N O N E Q U I T Y ( R O E )R E T U R N O N A S S E T S ( R O A ) & R E T U R N O N E Q U I T Y ( R O E )

dunia's robust performance across all measures of the top-line and bottom-line has translated into an accelerated growth in shareholder equity with a consistent year on year dividend payout record.

The shareholder equity has grown 28.4% over 2012 in addition to a cumulative dividend of AED 29.2 Mln paid out since inception. With the inclusion of dividends paid out since inception, the “Total Shareholder Worth” has grown by 33.0% to a value of AED 477 Mln

S H A R E H O L D E R E Q U I T YS H A R E H O L D E R E Q U I T Y

dunia started the trend of paying annual dividends to its shareholders from its first year of profitability in 2011. The dividend quantum has grown from AED 2.8Mln (AED 5/Share) in 2011 to AED 8.8 Mln (AED 16/share) in 2012 to AED 17.6 Mln (AED 32/share) in 2013.

D I V I D E N DD I V I D E N D

0.0 0.0

12.014.9

Dividend payout ratio>=12% p.a.

Dividend payout ratio > =12% p.a.(14.9% payout in 2013)

25

20

15

10

5

02009 2010 2011 2012 2013

Dividend / Net Income(% p.a.)

15.2

0.0 0.0

2.8

8.8

17.6100% growth in dividend payout

in 2013 vs. 2012

AED 17.6 Mln dividend in 2013(100% better vs. 2012)

20

16

12

8

4

02009 2010 2011 2012 2013

Dividend Paid(AED Mln)

0.0 0.05.0

16

32

100% growth in dividend paid / share in 2013 vs. 2012

AED 32 / share dividend paid for 2013(100% better vs. 2012)

40

32

24

16

8

02009 2010 2011 2012 2013

Dividend / Share(AED)

NOTE: *AED 8.8 Mln dividend paid in subsequent year 2014

500

400

300

200

100

02009 2010 2011 2012 2013

Equity & Cumulative dividend(AED Mln) Cumulative Dividend Shareholder Equity

2.811.6

29.2*

285.1

351.1267.0 355.8

456.6

Consistent equity growth and dividend payout

track record

2013 Return on Assets of 12.4% p.a. (28.6% higher vs. 2012)

50

30

10

0

(10)

(30)

(50)2009 2010 2011 2012 2013

Return on Assets(% p.a.)

29% improvement in ROA in2013 vs. 2012

(25.6) (20.3)

3.39.7

12.4

2013 Return on Equity of 28.9% p.a. (25.0% higher vs. 2012)

50

30

10

0

(10)

(30)

(50)2009 2010 2011 2012 2013

Return on Equity(% p.a.)

25% improvement in ROE in2013 vs. 2012

(32.7)(29.2)

6.7

23.1 28.9


A U D I T E DF I N A N C I A L S


• 35% y-o-y growth in customer receivables to AED 1.03 billion

• 24% y-o-y growth in customer deposits to AED 515 Million

• 25% y-o-y growth in deposit customer base to 1634 customers

• Customer asset growth fully funded by deposits and retained earnings

• No dependency on professional funds

• 26% y-o-y growth in revenue to AED 354 Million

• 10% y-o-y increase in expenses to AED 149 Million

• Cost-Income signifi cantly dropped to 42%

• 16% positive Operating Leverage• 9% y-o-y reduction in loss rate (cost

of credit) to 9.9% • 17.7% y-o-y improvement in Loss

Absorption Capacity to 2.4x• 2.4% ratio of Impairment Reserves

to Receivables• 25% y-o-y improvement in ROE to

28.9%

dunia continues to grow positively showing a continued strong growth trend in the year ahead.

dunia has been prudent in loss recognition and its total impairment reserves, is at a healthy ratio of 2.4% of customer assets.

We are pleased to recommend for the consideration of the shareholders a final dividend of AED 16 per share which together with the interim dividend paid of an equivalent amount aggregates to a total dividend of AED 32 per share, issued and paid up at a face value of AED 1000 each.

dunia has focused on building adequate liquidity and grown the customer deposit portfolio by AED 101.1 Million through the year, reaching the AED 500 Million mark, ensuring that customer asset growth has been entirely self-funded through customer deposits and retained earnings. Liquidity continues to be managed prudently with the result that cash and deposits with banks stood at AED 37 million as at the year end.

FRANCHISE

dunia received its first ever credit rating of BB- from Fitch. This standalone rating reflects strong portfolio growth and track record, solid financials, and capable management. dunia also continued to focus on its customer centric business approach, while ensuring a commitment to excellence in all aspects of the business. dunia invested in building its brand to make it an even stronger and well recognized brand.

CREATING CAPABILITIES

dunia integrated into the Central Bank’s UAE Direct Debit System enabling straight through processing of customer monthly payments, thereby enhancing efficiency and lowering costs. ESTABLISHING CREDIBILITY

dunia was recognized once again by Singapore Management University (SMU) as it selected dunia to write a case on its Credit Risk Management framework. This case study is a follow-up to the previous one published in 2012, also written by SMU, which detailed how dunia was setup in the midst of the financial crisis. The new case study, titled, ‘The Birth of Dunia (B): Time to Actively Start Lending?’ covers the initial few months of dunia post its launching of business in the UAE. It looks into the initial approach and strategy that the company used to lend in the UAE, at a time when job loss rates were high and markets were damp.

SUCCESS THROUGH EXCEPTIONAL SERVICE

dunia was ranked as 4th in the UAE for exceptional service by Gulf News in 2013, the leading publication in the UAE. This exceptional service award is a tribute of dunia’s continued focus on the customer and ensuring “customer delight” at all times.

ENGAGING WITH THE COMMUNITY

dunia Cares, dunia’s Corporate Social Responsibility, continues to focus on the community's pressing issues of health, environment, social welfare and education. dunia relies on its staff, customers, partners, and the wider community to engage in key initiatives which help address these issues.

dunia has led several key initiatives in 2013 across its key focus areas of Social Responsibility, Health, Environment and Education. As part of its focus on education as a key pillar, dunia launched the ‘dunia Young Business Leaders’ Program in 2013, a unique 3 week summer internship program for high school and university students. The program which was offered on a complimentary basis offered students the opportunity to learn how to set up a business in 3 weeks, while engaging with industry experts and leading entrepreneurs.

dunia also rolled out key initiatives including Ramadan donation drive for the less privileged individuals living in labour camps whereby dunia engaged its staff, customers and the broader community to provide for Iftar meals as well as hygiene gift bags with basic necessities for these individuals. dunia has also been quite active in collaborating with local hospitals across the nation to organize national blood donation drives to help those in need.

dunia also continues its focus on dunia Touch, which is a new and unique social volunteer program made available by dunia in collaboration with leading community service firms which have an established track record of social entrepreneurism programs through the spirit of volunteerism.

SUSTAINABILITY

dunia issued its first Sustainability Report in 2013 covering its approach and philosophy about how a successful and predictable business, helps ensure a sustainable focus on giving back to the

Dear Shareholders,

The Directors present their report to the shareholders together with the audited financial statements of Dunia Finance LLC ("the Company") for the year ended 31 December, 2013 and the financial position of the Company as at 31 December, 2013.

BACKGROUND

The Company, also known as “dunia”, was formally established on 7 July, 2008 as a limited liability company registered in UAE, having its registered office in Abu Dhabi. dunia is a finance company formed as a strategic partnership between Fullerton Financial Holdings Pte Ltd - a wholly owned subsidiary of Temasek Holdings Pte Ltd in Singapore; Mubadala Development Company PJSC - a business development and investment company wholly owned by the Government of Abu Dhabi; Al Waha Capital PJSC - a diversified investments holding company and A.A. Al Moosa Enterprises LLC - a leading local business house and prominent real estate group in UAE.

DIRECTORS

The directors of the Company in office at the date of this report are as follows:

1. Mr. Salem Rashid Al Noaimi, Chairman

2. Mr. Rajeev Kakar, Managing Director and Chief Executive Officer

3. Mr. Gan Chee Yen, Director4. Mr. Mansour Al Mulla, Director5. Dr. Ahmed Khalil Al Mutawa,

Independent Director

SHARE CAPITAL AND SHARE PREMIUM

The authorized, issued and paid up share capital of the Company is 550,000 shares ( 2012: 550,000 shares) of AED 1,000 each ( 2012: AED 1,000 each), amounting to AED 550,000,000 ( 2012: AED 550,000,000). Of these, 330,000 shares were issued at a premium of AED 110 each, amounting to

AED 36,300,000 (2012 : AED 36,300,000). The Company’s capital adequacy ratio is 32.44% (2012: 32.40%), significantly higher than the minimum 15% stipulated by the Central Bank of the UAE.

BUSINESS EVOLUTION

dunia delivered a record year in 2013, with a full year profitability of AED 118.48 Million during fiscal 2013.

This performance was driven by dunia’s finely tuned customer centric strategy of enhancing and deepening relationships through superior service, customized solutions, intelligent use of technology, enhanced platforms and well-trained people, as well as careful expense control.

The increasingly positive impact of dunia’s customer centric philosophy and sustainable approach to growth is reflected in a 21% increase in total customer numbers over the course of 2013. dunia now has 138,000 customers. This has led to customer assets surpassing AED 1 billion for the first time, having grown 35% to AED 1.03 billion. The Company saw commensurate growth in customer deposits, which were up by 24% against the prior period, reaching AED 515 million.

Funding quality and portfolio credit quality has continued to steadily improve, and the strategic actions taken include:• Prudent asset growth, targeted only

at tested good segments to reduce capital at risk

• A more selective customer target defi nition and tighter underwriting process

• Increased focus on secured assets• A value based pricing strategy to

ensure a balanced risk adjusted approach to building the portfolio

• Proactive strategic cost management focus to be a low cost provider and ensure effi ciencies on expense, and to deliver a healthy positive

operating leverage for long term sustainable growth

• Prudent and proactive impairment provisioning to build adequate loss absorption capacity, to ensure long term sustainability

• Accelerated focus on building better quality funding strategy through a portfolio of granular and tenured customer deposits, to mitigate concentration risk, and also market risk inherent in professional fund sources

• Diversifi cation of revenues through addition of new products and launch of transaction services, through an active cross - sell process based on demonstrated customer behavior, and a 360 degree customer centric approach to ensure that customer needs are truly understood

• Continued focus to build the business prudently to attain break-even early so as to be self- sustaining and to limit earnings drag, critical for sustaining growth

• Prudent test based approach to accelerating growth, while ensuring a disciplined focus on building a business model aimed to deliver a positive “Return on Asset” and “Return on Equity” – so as to ensure a predictable path to profi tability, which is important for delivering longer term sustainability.

FINANCIAL PERFORMANCE

dunia had a record-breaking performance in fiscal 2013 with:

• Record profi ts of AED 118 Million • Positive Net Income swing of AED 45

Million vs. 2012• Dividend increased to AED 32 per

share in 2013• Excellent liquidity management

with asset growth fully self-funded through granular and tenured customer deposits – which grew 24% by an incremental AED 101 Million during 2013

• 21% y-o-y growth in customer base to 138k customers

D I R E C T O R ' S R E P O R T


broader community. dunia recognizes that to be a truly sustainable company, business strategy must focus not just on achieving sustained financial growth and operational excellence, but also on building a robust corporate governance and financial controls environment. In addition, we believe that we must serve our customers and communities with passion and commitment, whilst protecting the environment for future generations to come and supporting the communities that make us who we are.

PEOPLE

dunia continues its strong focus on recruiting the best in class talent and also grooming future leaders of the company. dunia expanded its customer engagement to include top tier universities globally in order to recruit best in class talent for the Dunia Associate Program.

dunia has placed special emphasis on training its high potential talent by nominating them to attend global programs such as The University of Chicago Booth’s Accelerated Development Program, a 3 week management development program across key business skills. In addition, there are specific functional skills trainings focusing on Sales, Treasury, etc..

In line with dunia’s strategy to continuously ensure that focus is skewed towards the front line and customer interfacing units, teeth to tail ratio stood at 88% in 2013.

dunia places special emphasis and commitment to the Nation’s key priority of developing UAE talent and ensuring that UAE Nationals become future leaders. In line with this objective, dunia offers various opportunities under the ‘Kawader dunia’ program for developing UAE National talent – whether as full time experienced employees, part timers, or fresh graduates.

Diversity is a theme at dunia and we ensure to attract talent from different ethnic backgrounds, with different

experiences, who have also worked in various geographies. dunia employs 22 nationalities. dunia also places special emphasis on women empowerment and ensuring that women are empowered and enabled to succeed in their roles and become industry and nation leaders. dunia currently has 37% of management roles being led by women, who continue to bring unique ideas and dimensions to the table. In addition, 66% of dunia’s UAE National employees are also women.

PROCESS

There is a strong focus in dunia on optimizing resources and maximizing efficiency, while ensuring strong controls and discipline are in place. At dunia, we follow a rigorous discipline of ensuring high process control standards, strategic cost management and strategic risk management practices, while following a culture of excellence on corporate governance standards. We continue to also ensure the highest standards of transparency and disclosure in dealing our customers, employees and the wider stakeholders in line with our shared responsibility to deliver at the highest standards. This is in line with our continuous endeavor to raise the bar, in our commitment to serve our customer fairly, while delivering value, and also build a franchise that is admired by all.

dunia continues to streamline its operational framework and processes in order to be able to offer a seamless experience to customers, at a lower cost and more efficiently. dunia’s Cost / Income ratio has improved from 48.3% in 2012 to 42.2% in 2013. dunia’s robust risk management processes have also resulted in a 9% y-o-y reduction in loss rate (cost of credit) to 9.9%.

AUDITORS

The financial statements have been audited by PricewaterhouseCoopers who retire and, being eligible, offer themselves for reappointment.

ACKNOWLEDGEMENT

The directors wish to specially recognize the co-operation extended by every member of the dunia family and thank them for their ongoing contribution. The directors are also thankful for the wholehearted support received from the Central Bank of the UAE, various Ministries of the UAE Government, the Company’s bankers and the Company’s valued customers.

On behalf of the Board,


REPORT ON THE FINANCIAL STATEMENTS

We have audited the accompanying financial statements of Dunia Finance LLC (“the Company”) which comprise the statement of financial position as at 31 December 2013 and the statements of comprehensive income, changes in equity and cash flows for the year then ended and a summary of significant accounting policies and other explanatory notes.

MANAGEMENT’S RESPONSIBILITY FOR THE FINANCIAL STATEMENTS

Management is responsible for the preparation and fair presentation of these financial statements in accordance with International Financial Reporting Standards and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

AUDITOR'S RESPONSIBILITY

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free of material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

OPINION

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Company as of 31 December 2013 and its financial performance and its cash flows for the year then ended in accordance with International Financial Reporting Standards.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

As required by the UAE Federal Law No (8) of 1984, as amended, we report that:

(i) we have obtained all the information we considered necessary for the purpose of our audit;

(ii) the financial statements comply, in all material respects, with the applicable provisions of the UAE Federal Law No.(8) of 1984, as amended, and the Memorandum of Association of the Company ;

(iii) the Company has maintained proper books of account and the financial statements are in agreement there with;

(iv) the financial information included in the Directors’ report is consistent with the books of accounts of the Company; and

(v) nothing has come to our attention, which causes us to believe that the Company has breached any of the applicable provisions of the UAE Federal Law No (8) of 1984, as amended, or of its Memorandum of Association which would materially affect its activities or its financial position at 31 December 2013.

Further, as required by the UAE Union Law No (10) of 1980, as amended, we report that we have obtained all the information and explanations we considered necessary for the purpose of our audit.

PricewaterhouseCoopers23rd February 2014

Amin H NasserRegistered Auditor Number 307Dubai, United Arab Emirates

I N D E P E N D E N T A U D I T O R ’ S R E P O R T T O T H E

S H A R E H O L D E R S O F D U N I A F I N A N C E L L C

W Hunt, AH Nasser, P Suddaby and JE Fakhoury are registered as practicing auditors with the UAE Ministry of Economy

PricewaterhouseCoopers, Emaar Square, Building 4, Level 8, P O Box 11987, Dubai, United Arab EmiratesT: +971(0)4 304 3100, F: +971(0)4 330 4100, www.pwc.com/middle-east


S TA T E M E N T O F F I N A N C I A L P O S I T I O N

31 December

2013 31 December

2012

Note AED'000 AED'000

ASSETS

Cash and deposits with banks 5 37,052 81,110

Loans and advances 6 1,025,331 757,212

Property and equipment 7 5,763 8,113

Intangible assets 8 5,409 6,485

Other assets 9 10,536 14,458

Total assets 1,084,091 867,378

LIABILITIES AND EQUITY

Customer deposits 10 515,084 413,953

Due to related parties 11(c) 23,604 642

Borrowings 12 1,659 -

Provision for employees' end of service benefits 13 3,828 5,622

Other liabilities 14 83,278 91,398

Total liabilities 627,453 511,615

EQUITY

Share capital 15 550,000 550,000

Share premium 35,544 35,544

Statutory reserve 18 21,001 9,154

Accumulated losses (149,907) (238,935)

Total equity 456,638 355,763

Total liabilities and equity 1,084,091 867,378



S T AT E M E N T O F C O M P R E H E N S I V E I N C O M E

Year ended 31 December 2013 2012


Interest income 19 279,575 209,078

Interest expense 19 (19,924) (17,091)

Net interest income 259,651 191,987

Fees and commission income, net 20 94,216 89,368

Operating income 353,867 281,355

Impairment charge, net 21 (86,057) (72,035)

General and administrative expenses 22 (143,777) (129,569)

Amortisation and depreciation 7,8 (5,558) (6,332)

Net profit for the year 118,475 73,419

Other comprehensive income - -

Total comprehensive result for the year 118,475 73,419

The notes on pages 132 to 155 form an integral part of these financial statements.The notes on pages 132 to 155 form an integral part of these financial statements.

These financial statements were approved by the Board of Directors on 17th February 2014 and were signed on its behalf by:


Issued share capital

Share Premium

Statutory reserve

Accumulated losses

Total

AED'000 AED'000 AED'000 AED'000 AED'000

At 1 January 2012 550,000 35,544 1,812 (302,262) 285,094

Total comprehensive result for the year - - - 73,419 73,419

Dividends paid - - - (2,750) (2,750)

Transfer to statutory reserve - - 7,342 (7,342) -

At 31 December 2012 550,000 35,544 9,154 (238,935) 355,763

At 1 January 2013 550,000 35,544 9,154 (238,935) 355,763

Total comprehensive result for the year - - - 118,475 118,475

Dividends paid (Note 16) - - - (17,600) (17,600)

Transfer to statutory reserve - - 11,847 (11,847) -

At 31 December 2013 550,000 35,544 21,001 (149,907) 456,638

S TA T E M E N T O F C H A N G E S I N E Q U I T Y S T AT E M E N T O F C A S H F L O W S

The notes on pages 132 to 155 form an integral part of these financial statements.The notes on pages 132 to 155 form an integral part of these financial statements.



Operating activities

Net profit for the year 118,475 73,419

Adjustments:

Depreciation 7 3,308 4,115

Amortisation of intangible assets 8 2,250 2,217

Employees’ end of service benefits 13 (1,052) 1,797

Impairment charge 21 97,991 80,273

Disposal of intangible assets, property and equipment 34 -

Operating cash flows before payment of employees’

end of service benefits and changes in working capital 221,006 161,821

Payment of employees’ end of service benefits 13 (742) (904)

Operating cash flows before changes in working capital 220,264 160,917

Changes in working capital:

Loans and advances (365,379) (281,567)

Other assets 9 3,190 (3,257)

Customer deposits 10 101,131 172,364

Other liabilities 14 (8,120) 11,345

Net cash (used in) / generated from operating activities (48,914) 59,802

Investing activities

Deposits with maturities over 3 months 5 (1) (125)

Purchase of property and equipment 7 (991) (1,038)

Disposal of fixed assets 7 - 2

Purchase of intangible assets 8 (1,174) (6)

Net cash used in investing activities (2,166) (1,167)

Financing activities

Due to related parties 11 22,962 (7,072)

Dividends paid (17,600) (2,750)

Borrowings 12 - (23,679)

Net cash generated from/(used in) financing activities 5,362 (33,501)

Net (decrease)/increase in cash and cash equivalents (45,718) 25,134

Cash and cash equivalents, beginning of the year 45,985 20,851

Cash and cash equivalents, end of the year 5 267 45,985


1. LEGAL STATUS AND PRINCIPAL ACTIVITY

Dunia Finance LLC (“the Company”) was formally established as a limited liability company on 7 July 2008 under the UAE Companies Law. The Company was licensed by the Central Bank of the UAE on 11 September 2008 to operate as a finance company.

The Company’s principal activity is providing customer centric financial solutions to its target customer segments.

The Company’s registered address is Al Fardan Building, Hamdan Street, PO Box 44005, Abu Dhabi, United Arab Emirates.

The shareholders of the Company and their respective shareholding are as follows:

During the year, certain employees in the operations, information technology, contact centre, accounting, marketing and strategic analytics functions of the Company were transferred to Dunia Services FZ LLC. Thereafter, these services have been provided by Dunia Services FZ LLC at a mutually agreed price.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The significant accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the periods presented, unless otherwise stated.

2.1 BASIS OF PREPARATION

The financial statements have been prepared in accordance with International Financial Reporting Standards (IFRSs) as issued by the International Accounting Standards Board (IASB),

interpretations issued by International Financial Reporting Interpretations Committee (IFRIC) and applicable requirements of the laws of the United Arab Emirates. The financial statements are prepared under the historical cost convention.

The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Company’s accounting policies. Changes in assumptions may have a significant impact on the financial statements in the period the assumptions changed. Management believes that the underlying assumptions are appropriate and that the Company’s financial statements therefore fairly present the financial position and results.

The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed in Note 4.

Standards and amendments to published standards effective for the Company’s accounting period beginning from 1 January 2014 and subsequent periods.

The following applicable new standards and amendments have been issued but are not effective for the Company’s accounting period beginning 1 January 2013 and have not been early adopted by the Company:

• Amendments to IAS 32 ‘Financial Instruments’ (effective 1 January 2014) require presentation to clarify certain aspects because of diversity in application of the requirements on offsetting, focused on four main areas :

- the meaning of 'currently has a legally enforceable right of set-off'

- the application of simultaneous realisation and settlement

- the offsetting of collateral amounts - the unit of account for applying the offsetting

requirements

• Amendment to IAS 36 ‘Impairment of Assets’ (effective 1 January 2014) to reduce the circumstances in which the recoverable amount of assets or cash-generating units is required to be disclosed, clarify the disclosures required, and to introduce an explicit requirement to disclose the discount rate used in determining impairment (or reversals) where recoverable

N O T E S T O T H E F I N A N C I A L S T AT E M E N T S

F O R T H E Y E A R E N D E D 3 1 D E C E M B E R 2 0 1 3 amount (based on fair value less costs of disposal) is determined using a present value technique.

• Amendment to IAS 19, ‘Employee benefits’ (effective 1 July 2014) clarify the requirements that relate to how contributions from employees or third parties that are linked to service should be attributed to periods of service. In addition, it permits a practical expedient if the amount of the contributions is independent of the number of years of service.

• IFRS 9 - Financial Instruments: Classification and Measurement (intended as complete replacement for IAS 39).

Key requirements of IFRS 9 are described as follows:

IFRS 9 requires all recognised financial assets that are within the scope of IAS 39 Financial Instruments: Recognition and Measurement to be subsequently measured at amortised cost or fair value. Specifically, debt investments that are held within a business model whose objective is to collect the contractual cash flows, and that have contractual cash flows that are solely payments of principal and interest on the principal outstanding are generally measured at amortised cost at the end of subsequent accounting periods. All other debt investments and equity investments are measured at their fair values at the end of subsequent accounting periods.

An effective date for IFRS 9 will be announced once the standard is complete with a new impairment model and finalisation of any limited amendments to classification and measurement. The Company shall therefore, only be in a position to assess IFRS 9’s full impact when the standard is finalised and published.

Except for IFRS 9, the Management anticipates that the above amendments are not expected to have a material impact on the Company’s financial statements and will be adopted in the financial statements in the initial period when they become mandatorily effective.

2.2 FOREIGN CURRENCY TRANSLATION

a. Functional and presentation currency The financial statements are presented in United Arab Emirates Dirhams (AED), which is the Company’s functional and presentation currency.

b. Translation and balances

Foreign currency transactions are translated into the functional currency using exchange rates prevailing at the date of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities

denominated in foreign currencies are recognised in the statement of comprehensive income.

2.3 INTANGIBLE ASSETS

Software acquired by the Company is stated at cost less accumulated amortisation and impairment. Expenditure on internally developed software is recognised as an asset when the Company is able to demonstrate its intention and ability to complete the development and use the software in the manner that will generate future economic benefits and can reliably measure the costs to complete development. The capitalised costs of internally developed software include all costs directly attributable to developing the software and are amortised over its useful life. Internally developed software is stated at capitalised costs less accumulated amortisation and impairment.

Subsequent expenditure on software assets is capitalised only when such expenditure increases the future economic benefits embodied in the specific asset to which it relates. All other expenditure is expensed as incurred.

The assets’ residual values and useful lives are reviewed and adjusted, if appropriate, at each date of statement of financial position.

Intangible assets that are subject to amortisation are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash-generating units). Assets that suffered impairment are reviewed for possible reversal of the impairment at each reporting date. An intangible asset is derecognised / written off when no future economic benefits are expected from its use or disposal and loss on derecognition of asset is recognised in the income statement for the period in which derecognition occurs.

2.4 PROPERTY AND EQUIPMENT

Property and equipment are stated at historical cost less accumulated depreciation. The cost of property and equipment includes expenditure directly attributable to the acquisition or construction of the asset as well as expenditure incurred on bringing the asset to the working condition and location for its intended use. Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item

Bugis Investments Mauritius Pte Ltd (a wholly owned subsidiary of Fullerton Financial Holdings Pte Ltd)

Alpha Investment Company LLC (a subsidiary of Mubadala Development Company PJSC)

Al Waha Capital - PJSC

A A Al Moosa Enterprises LLC

40%

31%

25%

4%


can be measured reliably. All other repairs and maintenance are charged to the statement of comprehensive income during the financial period in which these are incurred.

Depreciation is recognised in the statement of comprehensive income on a straight-line basis, at rates calculated to reduce the cost of assets to their estimated residual value over their expected useful lives, as follows: YearsOffice and other equipment 3-8Leasehold improvements Up to 10Motor vehicles 3-5

The assets’ residual values and useful lives are reviewed and adjusted, if appropriate, at each date of statement of financial position.

Gains and losses on disposal of property and equipment are determined by comparing the sales proceeds to the carrying value of the asset disposed and are taken into account in determining operating income / (loss).

Capital Work-In-Progress is stated at cost when the asset is ready for use. Capital Work-in-Progress is transferred to the appropriate Property Plant and Equipment or Intangible Asset category and depreciated or amortised in accordance with the Company’s policy.

2.5 LOANS AND ADVANCES

Loans and advances are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market.

Loans and advances are initially recognised at fair value, which is the cash consideration to originate the loan and advance including any transaction costs, and measured subsequently at amortised cost using the effective interest rate method. Loans and advances are reported in the statement of financial position as loans and advances to customers including interest receivable on the loans and advances. Interest on loans is included in the statement of comprehensive income and is reported as interest income. In the case of impairment, the impairment loss is reported as a deduction from the carrying value of the loan and advances, and recognised in the statement of comprehensive income as impairment charge.

The Company assesses at the end of each reporting period whether there is objective evidence that loans and advances are impaired. Loans and advances are considered impaired and impairment losses are incurred only if there is objective evidence of impairment as a result of one or more events that occurred after the initial recognition of the asset (a ‘loss event’) and that loss event (or events) has an impact on the estimated

future cash flows of the financial asset or group of financial assets that can be reliably estimated.

The criteria that the Company uses to determine that there is objective evidence of an impairment loss include:

• Delinquency in contractual payments of principal or interest;• Demise of the debtor.

The estimated period between occurrence of a loss and its identification is determined by management for each identified portfolio. In general, the periods used vary between one month and four months.

The Company first assesses whether objective evidence of impairment exists individually for loans and advances that are individually significant and collectively for loans and advances that are not individually significant. If the Company determines that no objective evidence of impairment exists for an individually assessed loan or advance, it includes it in a group of loans and advances with similar credit risk characteristics and collectively assesses them for impairment. Loans and advances that are individually assessed for impairment and for which an impairment loss is or continues to be recognised are not included in a collective assessment of impairment.

For the purposes of a collective evaluation of impairment, loans and advances are grouped on the basis of similar credit risk characteristics (i.e. on the basis of the Company’s evaluation process that considers category type, past-due status and other relevant factors).

The impairment charge on a group of loans and advances is collectively evaluated for impairment and estimated on the basis of historical trends of the probability of default, timing of recoveries and amount of loss incurred. Default rates, loss rates and expected timing of future recoveries are regularly benchmarked against actual outcomes to ensure they remain appropriate. Where historical data is not sufficient to assess trends, market loss experience is substituted using a lagged approach whereby loss rates are based on movement of accounts from one stage of delinquency to another.

The amount of the loss is measured as the difference between the carrying amount of the loan or advance and the present value of estimated future cash flows (excluding future credit losses that have not been incurred) discounted at the original effective interest rate of the loan or advance. The carrying amount of the loan or advance is reduced through the use of an allowance account and the amount of the loss is recognised in the statement of comprehensive income. If a loan or advance has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract.

When a loan or advance is uncollectible, it is written off against the related impairment allowance. If no related impairment allowance exists, it is written off to the statement of comprehensive income. Subsequent recoveries, if any, are credited to the statement of comprehensive income. If the amount of impairment subsequently decreases due to an event occurring after the write down, the release of the allowance is credited to the statement of comprehensive income.

Loans that are either subject to individual or collective impairment assessment and whose terms have been renegotiated are no longer considered to be past due but are treated as new loans. In subsequent years, the asset is considered to be past due and disclosed if contractually delinquent and renegotiated again.

2.6 CASH AND CASH EQUIVALENTS

Cash and cash equivalents comprise balances with less than three months maturity from the date of acquisition, including cash in hand, deposits held with original maturities of three months or less, net of bank overdrafts.

2.7 OTHER EMPLOYEE BENEFITS

The amount payable to employees in respect of the Company’s equity based payment scheme, which are settled in cash, is recognised as an expense with a corresponding increase in liabilities, over the period that the employees become eligible for payment. The liability is re-measured at each reporting date and at settlement date. Any changes in the fair value of the liability are recognised as staff costs in the statement of comprehensive income.

All other employee benefits are accrued for as and when services are rendered by the employees.

2.8 PROVISIONS

Provisions are recognised when the Company has a present legal or constructive obligation as a result of past events and it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and a reliable estimate of the obligation amount can be made.

2.9 REVENUE RECOGNITION

a. Interest income and expense

Interest income and expense is recognised in the statement of comprehensive income using the effective interest rate method. The effective interest rate is the rate that exactly discounts estimated future cash receipts and payments through its expected life (or, where appropriate, a shorter period) to the net carrying amount of the financial asset or liability.

While calculating effective interest rate, cash flows are estimated considering all contractual terms of the financial instruments, but not future credit losses. The calculation includes all discounts or premiums that are an integral part of the effective interest rate. Transaction costs are incremental costs that are directly attributable to the acquisition, issue or disposal of a financial asset or liability. Transaction costs include fees and commissions paid to agents (including employees acting as selling agents), advisers, brokers and dealers. Transaction costs do not include debt premiums or discounts, financing costs or internal administrative or holding costs.

b. Fees and commission income

Fees and commission income that are integral to the effective interest rate on a financial asset or liability are included in the calculation of the effective interest rate to arrive at the amortised cost of financial asset and financial liability.

Other fees and commission income are generally recognised as and when the service has been provided.

2.10 EMPLOYEES’ END OF SERVICE BENEFITS

Pension contributions are made in respect of UAE national employees to the UAE General Pension and Social Security Authority in accordance with the UAE Federal Law No (7), 1999 for Pension and Social Security.

Provision is made for the end of service benefits due to expatriate employees in accordance with UAE Labour Law for their periods of service up to the date of these financial statements. The provision for the end of service benefits is calculated annually by independent actuaries using the projected unit credit method.

2.11 LEASES

The leases entered into by the Company are operating leases. Payments made under operating leases are charged to other operating expenses in the statement of comprehensive income on a straight-line basis over the period of the lease. When an operating lease is terminated before the lease period has expired, any payment required to be made to the lessor by way of penalty is recognised as an expense in the period in which termination takes place.

2.12 BORROWINGS

Borrowings are recognised initially at fair value, net of transaction costs incurred. Borrowings are subsequently carried at amortised cost; any difference between the proceeds (net of transaction costs) and the redemption value is recognised in the income statement over the period of the borrowings using the effective interest method.


Fees paid on the establishment of loan facilities are recognised as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down. In this case, the fee is deferred until the draw-down occurs. To the extent there is no evidence that it is probable that some or all of the facility will be drawn down, the fee is capitalised as a pre-payment for liquidity services and amortised over the period of the facility to which it relates.

2.13 DIVIDEND ON ORDINARY SHARES

Dividend on ordinary shares is recognised in equity in the period in which it is approved by the Company's shareholders.

3. FINANCIAL RISK MANAGEMENT

The Company’s activities expose it to a variety of financial risks and those activities involve the analysis, evaluation, acceptance and management of some degree of risk or combination of risks. Taking risk is core to the financial services business and these risks are an inevitable consequence of being in business. The Company’s aim is therefore to achieve an appropriate balance between risk and return and minimise potential adverse effects on the Company’s financial performance.

The Company’s risk management policies approved by the Board of Directors are designed to identify and analyse these risks, to set appropriate risk limits and controls, and to monitor the risks and adherence to limits by means of reliable and up-to-date information systems. The Company regularly reviews its risk management policies and systems. The Chief Risk Officer oversees risk management based on policies approved by the Board of Directors. In addition, internal audit is responsible for the independent review of risk management and the control environment.

The main types of risk are credit risk, liquidity risk and market risk. Market risk includes currency risk, interest rate and price risk.

3.1 CREDIT RISK

The Company takes on exposure to credit risk, which is the risk that a customer or counterparty will cause a financial loss to the Company by failing to discharge an obligation. Credit risk is an important risk for the Company’s business and management, therefore, the Company carefully manages its exposure to credit risk. Credit exposures arise principally in lending activities and placement of deposits and balances with the banks. There is also credit risk in off balance sheet financial commitments such as unused credit card limits and guarantees given.

The credit risk management and control function is overseen by the Chief Risk Officer. The Business Risk and Compliance Committee periodically reviews and monitors all applicable risks including credit risk limits.

Exposure to credit risk is also managed through regular analysis of the ability of counterparties to meet interest and repayment obligations and by changing these limits where appropriate.

3.1.1 CREDIT RISK MEASUREMENT

In measuring credit risk of loans and advances to customers, the Company adopts the following approaches:

(i) Individually assessed loans and advances

At each date of the statement of financial position, a case by case assessment is carried out to identify whether there is objective evidence that a loan and advance is impaired. This approach is applied to loans and advances that are considered individually significant. The loss includes the aggregate exposure to the customer, and amount of expected receipts. The realisable value of security and collaterals and the likelihood of successful repossession will have to be considered as well as the likely costs involved in recovery of outstanding amounts.

(ii) Collectively assessed loans and advances

Impairment is assessed on a collective basis to:

• Cover losses which have been incurred but have not yet been identified on loans and advances subject to individual assessment.

Individually assessed loans for which no evidence of loss has been specifically identified on an individual basis are grouped together according to the credit risk characteristics for the purpose of calculating an estimated collective loss. This reflects losses incurred at the date of financial position which will only be individually identified in future. The measurement of the loss will factor in the:

- historical loss experience in portfolios with similar risk characteristics;

- emergence period which is the time period between when the impairment actually occurs till there is objective evidence that impairment exists; and

- management’s judgment as to whether the prevailing economic and credit conditions could result in the actual loss being higher or lower than that suggested by historical experience.

• Cover losses for homogeneous groups of loans and advances that are not considered individually significant.

Where adequate historical information is available, statistical methods are used to calculate losses inherent in the portfolio. Inherent losses are computed based on the estimated net present value (NPV) of each cohort of loans, and comparing this with the carrying cost of that cohort. The net present value curve is computed based on statistical regression techniques using historical NPV by month on book.

When there have been changes in economic, regulatory or behavioural conditions, historical loss experience provides less relevant information when the most recent trends in the portfolio risk factors are not fully reflected in statistical models. In such circumstances, such risk factors are taken into account when calculating the appropriate level of losses.

3.1.2 RISK LIMIT CONTROL AND MITIGATION POLICIES

The Company manages limits and controls concentration of credit risk to individuals, employees of different industry sectors and tenors. Such risks are monitored regularly and subject to an annual formal review. Limits to banks are approved by the Board of Directors and exposures within the limits tracked daily.

The Company extensively uses analytics to monitor changes in the credit profiles of its segmented portfolio. Analytical tools are used to weigh the risk reward equation to aid decision making in terms of lending to selected customer segments. Further monitoring of delinquencies across the customer loan portfolio is aimed at identifying trends and ensuring that the credit risk related to the portfolio is pro-actively managed. The Company has pre-defined delinquency ratio ranges which will warrant appropriate remedial action if the ranges are breached. Credit risk to professional counterparties is managed by due diligence and evaluation of the professional counterparty’s credit risk which may include reference to external credit ratings.

Collaterals are used as mitigating tools by the Company. The principal acceptable collaterals are:

(i) Mortgages over the vehicles for the auto loans and advances(ii) Cash deposits for personal loans and advances to customers

and guarantees issued on behalf of customers

The maximum value of the loan and advance and the guarantees, as well as the valuation frequencies are clearly documented in the credit policy.

3.1.3 IMPAIRMENT AND PROVISIONING

The Company establishes an allowance for impairment losses that represents its estimate of incurred losses in its loan portfolio. The main components of this allowance are a specific loss component that relates to individual exposures, and a collective impairment loss allowance for losses that have been incurred but not identified, established for groups of homogeneous loans with similar risk characteristics. Future cash flows from a group of loans and advances that are collectively evaluated for impairment are estimated on the basis of historical loss experience for assets with credit risk characteristics similar to those in the group.


3.1.4 MAXIMUM EXPOSURE TO CREDIT RISK BEFORE COLLATERAL HELD OR OTHER CREDIT ENHANCEMENTS

The following table analyses the Company’s maximum exposures to credit risk at their carrying amounts, as categorised by the market segments and product types, all of which are in the United Arab Emirates.

The segmentation of loans and advances is used as a basis to assess the quality of the loans and effectively manage the credit risk.

The total outstanding contractual amount of commitments towards unused credit card limits does not necessarily represent future cash requirements, since these unused credit card limits may not be fully utilised and are revocable by the Company.

Financial guarantees represent guarantees issued by the Company on behalf of customers favouring the UAE Ministry of Labour and other government bodies and are substantially secured by cash collateral (Note 10).

3.1.5 LOANS AND ADVANCES

The gross amount of loans and advances, net of write offs, which are current and past due and the corresponding impairment allowances are as follows:

Loans and advances of AED 51.3 million (31 December 2012: AED 28.8 million) have been directly written off to the statement of comprehensive income (Note 21). Loans and advances of AED 51 million (31 December 2012: AED 44.7 million) have been written off against the impairment allowance (Note 6).

There were no loans which were past due but not impaired at 31 December 2013.

31 December

2013

31 December

2012

AED'000 AED'000

Current 955,568 726,267

Past due up to 30 days 38,094 24,881

Past due 31-90 days 41,909 26,363

Past due 91-120 days 14,897 9,918

Total 1,050,468 787,429

Impairment

Current (5,419) (6,354)

Past due up to 30 days (5,242) (6,254)

Past due 31-90 days (9,892) (12,153)

Past due 91-120 days (4,584) (5,456)

Total (25,137) (30,217)

Net loan amount 1,025,331 757,212

Salaried mass

market

Self employed

mass market

Salaried mass

affluent

Others Total

AED'000 AED'000 AED'000 AED'000 AED'000

At 31 December 2013

On balance sheet assets:

Loans and advances

- Credit cards 221,631 17,211 151,821 - 390,663

- Personal loans 262,778 30,685 179,587 - 473,050

- Auto loans 74,324 75,480 36,504 - 186,308

- Loans secured by deposits - - 447 - 447

Deposits with banks - - - 36,429 36,429

Other assets - - - 2,670 2,670

Total 558,733 123,376 368,359 39,099 1,089,567

Off balance sheet items:

Unused credit card limits 264,550 30,689 298,180 - 593,419

Financial guarantees - - - 162,705 162,705

(Note 24)

Total 264,550 30,689 298,180 162,705 756,124

At 31 December 2012

On balance sheet assets:

Loans and advances

- Credit cards 133,211 11,068 103,982 - 248,261

- Personal loans 205,195 12,911 167,600 - 385,706

- Auto loans 61,180 60,598 31,373 - 153,151

- Loans secured by deposits - - - 311 311

Deposits with banks - - - 80,188 80,188

Other assets - - - 2,664 2,664

Total 399,586 84,577 302,955 83,163 870,281

Off balance sheet items:

Unused credit card limits 128,471 15,515 162,493 - 306,479

Financial guarantees - - - 124,577 124,577

(Note 24)

Total 128,471 15,515 162,493 124,577 431,056


3.2 LIQUIDITY RISK

Liquidity risk is the risk that the Company is unable to meet its payment obligations associated with its financial liabilities when they fall due and to replace funds when they are withdrawn. The consequence may be the failure to meet obligations to repay depositors and fulfil commitments to lend.

The Company’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company’s reputation.

The Company’s liquidity management process includes:

• Managing day to day funding, through anticipating and monitoring future cash flow requirements.• The primary tool employed by the Company is the maturity mismatch analysis, which includes behavioural assumptions on debts

and loans repayments.• Monitoring balance sheet liquidity ratios, market movements and interest rate forecasts.• Setting and monitoring limits for the above mentioned process.

Sources of liquidity are regularly reviewed and the Company seeks to diversify funding sources and increase investor base to ensure continuous access to debt markets. All liquidity policies and procedures are subject to review and approval by the Asset and Liability Committee (“ALCO”).

3.2.1 NON DERIVATIVE FINANCIAL LIABILITIES AND LIQUIDITY RISK

The table below presents the maturity profile of the cash flows payable by the Company in respect of its non-derivative financial liabilities, by remaining contractual maturities at the statement of financial position date. The amounts disclosed in the table are the contractual undiscounted cash flows.

Unused credit card limitsThe date of the contractual amount of the Company’s commitment towards unused credit card limits (Note 24(b)) is summarised in the following table. However, the commitments to extend credit are revocable at the option of the Company.

Financial guaranteesFinancial guarantees represent guarantees issued by the Company on behalf of customers favouring the UAE Ministry of Labour and other government bodies and are substantially secured by cash collateral (Note 24(b)), financial guarantees are also included in the above table based on the earliest contractual maturity date. The financial guarantees issued are substantially collateralised by deposits received from the customers.

Operating lease commitmentsThe future minimum lease payments under non-cancellable operating leases for properties as disclosed in Note 24(a).

Capital commitmentsCapital commitments are in respect of equipment and software purchases (Note 24(c)).

3.2.2. OFF BALANCE SHEET ITEMS

Less than 1 year 1 - 5 years Total

AED'000 AED'000 AED'000

At 31 December 2013

Unused credit card limits 593,419 - 593,419

Financial guarantees 162,705 - 162,705

Operating lease commitments 3,011 10,838 13,849

Capital commitments 55 - 55

Total 759,190 10,838 770,028

At 31 December 2012

Unused credit card limits 306,479 - 306,479

Financial guarantees 124,577 - 124,577

Operating lease commitments 4,646 6,118 10,764

Capital commitments 230 - 230

Total 435,932 6,118 442,050

Less than 1 year 1 - 5 years Over 5 years Total

AED'000 AED'000 AED'000 AED'000

At 31 December 2013

Customer deposits 331,222 145,297 45,435 521,954

Due to related parties 23,604 - - 23,604

Borrowings 1,674 - - 1,674

Other liabilities 69,395 5,231 - 74,626

Total 425,895 150,528 45,435 621,858

At 31 December 2012

Customer deposits 242,407 165,624 50,644 458,675

Due to related parties 642 - - 642

Other liabilities 74,454 8,519 - 82,973

Total 317,503 174,143 50,644 542,290


3.3 MARKET RISK

The Company takes on exposure to market risk, which is the risk that fair value or future cash flows will fluctuate as a result of changes in market prices. Market risk arises from exposure to currency and interest rate fluctuations. The ALCO meets regularly to review and provide direction related to interest rate risk, currency risk and price risk in the Company. It ensures that the exposures of the Company are within prudent levels.

The main measurement techniques used to measure and control market risks are outlined below:

3.3.1 INTEREST RATE RISK

Interest rate risk arises from mismatches in the interest rate profile of the Company’s assets and liabilities. Cash flow interest rate risk is the risk that the future cash flows of a financial instrument will fluctuate due to changes in the market interest rates. The Company takes on exposure to the effects of fluctuations in the prevailing levels of market interest rates on both its fair value and cash flow risks. The Company strives to maintain an interest rate profile that will lead to financial performance consistent with its long term objectives.

The ALCO sets limits on the level of mismatch of interest rate re-pricing that may be undertaken, which are monitored by the market risk manager. Regular stress testing is performed using hypothetical scenarios to monitor the Company’s vulnerability to simultaneous shocks on market risks. It gives an indication of the potential loss that arises in extreme conditions, facilitating the proactive management of market risks in an environment of rapid market changes.

The table on the following page summarises the Company's exposure to interest rate risk. It includes the Company’s assets and liabilities at carrying amounts, categorised by the earlier of contractual re-pricing or maturity dates.

Up to 3 months

3 months to 1 year

1 year to 5 years

Over5 years

Non-interest bearing

Total Effective interest rate

AED'000 AED'000 AED'000 AED'000 AED'000 AED'000

At 31 December 2013

Assets

Cash and deposits with banks 1926 35,126 - - - 37,052 0.81%

Loans and advances 494,243 155,263 375,823 2 - 1,025,331 31.14%

Property and equipment - - - - 5,763 5,763 -

Intangible assets - - - - 5,409 5,409 -

Other assets - - - - 10,536 10,536 -

Total assets 496,169 190,389 375,823 2 21,708 1,084,091

Liabilities and equity

Customer deposits 118,702 211,693 142,137 42,552 - 515,084 4.52%

Due to related parties - - - - 23,604 23,604 -

Borrowings 1,659 - - - - 1,659 4.58%

Employees’ end of service

benefits - - - - 3,828 3,828 -

Other liabilities - - - - 83,278 83,278 -

Shareholders’ equity - - - - 456,638 456,638 -

Total liabilities and equity 120,361 211,693 142,137 42,552 567,348 1,084,091

Interest rate sensitivity gap 375,808 (21,304) 233,686 (42,550) (545,640) -

At 31 December 2012

Assets

Cash and deposits with banks 35,273 35,125 - - 10,712 81,110 0.86%

Loans and advances 320,308 131,713 305,191 - - 757,212 30.57%

Property and equipment - - - - 8,113 8,113 -

Intangible assets - - - - 6,485 6,485 -

Other assets - - - - 14,458 14,458 -

Total assets 355,581 166,838 305,191 - 39,768 867,378

Liabilities and equity

Customer deposits 76,781 160,888 146,508 29,776 - 413,953 4.88%

Due to related parties - - - - 642 642 -

Borrowings - - - - - - -

Employees’ end of service

benefits - - - - 5,622 5,622 -

Other liabilities - - - - 91,398 91,398 -

Shareholders’ equity - - - - 355,763 355,763 -

Total liabilities and equity 76,781 160,888 146,508 29,776 453,425 867,378

Interest rate sensitivity gap 278,800 5,950 158,683 (29,776) (413,657) -


The interest rate sensitivities set out above are illustrative only and employ simplified scenarios. The sensitivity does not incorporate actions that could be taken by management to mitigate the effect of interest rate movements.

3.3.2 CURRENCY RISK

The Company does not have any significant foreign currency exposures, since its transactions are in UAE Dirham or US Dollar and the UAE Dirham is currently pegged against the US Dollar.

3.3.3 PRICE RISK

Price risk is the risk that the value of the Company’s financial instruments will fluctuate as a result of changes in market prices caused by factors other than interest rates or foreign currency movements. The price risk arises primarily from uncertainty about the future price of financial instruments that the Company holds. The Company does not hold financial instruments whose value is affected by changes in market prices and therefore it is not exposed to any price risk.

3.4 FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES

The fair values of the Company’s financial assets and liabilities approximate their carrying values as reflected in these financial statements.

Interest rate sensitivity

The Company is exposed to the effects of fluctuations in the prevailing levels of rates of interest on its cash flows.

Interest rate risk is assessed by measuring the impact of reasonable possible change in interest rate movements. The Company assumes a fluctuation in interest rates of 10 basis points (bps) in interest rate and estimates the following impact on the net result for the year and equity at that date:

3.5 CAPITAL MANAGEMENT

The Company’s objectives when managing capital, which is a broader concept than the ‘equity’ on the face of balance sheets, is:

• to comply with the capital requirements set by its regulator;• to safeguard the Company’s ability to continue as a going concern so that it can continue to provide returns for shareholders; and• to maintain a strong capital base to support the development of its business.

Capital adequacy is monitored regularly by the Company, based on the guidelines stipulated by the Central Bank of the UAE. The minimum capital requirement stipulated by the Central Bank of the UAE is 15%. The Company calculates its capital adequacy ratio in accordance with guidelines established by the Central Bank of the UAE prescribed as the ratio of total capital to total assets and is analysed as follows:

31 December

2013

31 December

2012

AED'000 AED'000

Tier 1 capital

Share capital 550,000 550,000

Share premium 35,544 35,544

Statutory reserve 9,154 1,812

Accumulated losses (238,935) (302,262)

Intangible assets (5,409) (6,485)

Total tier 1 capital 350,354 278,609

Tier 2 capital - -

Total tier 2 capital - -

Total regulatory capital 350,354 278,609

Risk weighted assets

On balance sheet 1,077,612 859,660

Off balance sheet 2,230 268

Total risk weighted assets 1,079,842 859,928

Risk asset ratio on total capital base (%) 32.44% 32.40%

Risk asset ratio on tier 1 capital base (%) 32.44% 32.40%

Minimum risk asset ratio required by the UAE Central Bank 15.00% 15.00%

31 December

2013

31 December

2012

AED'000 AED'000

Fluctuation in interest rates by 10 bps 360 280


4. CRITICAL ACCOUNTING ESTIMATES AND JUDGMENTS

The Company makes estimates and assumptions that affect the reported amounts of assets and liabilities within the next financial year. Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

Impairment losses on loans and advances

The Company establishes an allowance for impairment losses that represents its estimate of incurred losses in its loan portfolio. The main components of this allowance are a specific loss component that relates to individual exposures, and a collective impairment loss allowance for losses that have been incurred but not identified, established for groups of homogeneous loans with similar risk characteristics. Future cash flows from a group of loans and advances that are collectively evaluated for impairment are estimated on the basis of historical loss experience for assets with credit risk characteristics similar to those in the group.

Other employee benefits

The present value of the equity based payment scheme included in other employee benefits depends on a number of factors that are determined using a number of assumptions. The assumption used in determining the accrual for other employee benefits include the discount and attrition rate. Any change in these assumptions will impact the carrying amount of other employee benefit obligations.

The Company determines the appropriate discount and attrition rate at the end of each reporting period. In determining the appropriate discount rates, the Company considers the interest rates of treasury bonds that have terms to maturity approximating the terms of the other employee benefits liability.

5. CASH AND DEPOSITS WITH BANKS

For the purpose of the cash flow statement cash and cash equivalents have been calculated as follows:

Deposits with banks are placed with financial institutions in the UAE, and carry interest at the rate of 0.57% to 0.96% (31 December 2012: 1.06% to 1.4%) per annum.

Deposits of AED 35 million (31 December 2012: AED 35 million) have been pledged against guarantees issued by a bank on behalf of the Company.

6. LOANS AND ADVANCES

31 December

2013

31 December

2012

AED'000 AED'000

Personal loans 473,497 386,017

Auto loans 186,308 153,151

Credit cards 390,663 248,261

1,050,468 787,429

Less : impairment allowance (25,137) (30,217)

1,025,331 757,212

Movement in provision for impairment:

At beginning of the year 30,217 23,511

Impairment charge for the year (Note 21) 45,953 51,414

Written down with recourse (Note 3.1.5) (51,033) (44,708)

At end of the year 25,137 30,217

31 December

2013

31 December

2012

AED'000 AED'000

Cash and deposits with banks 37,052 81,110

Less: Deposits with maturities over 3 months (35,126) (35,125)

Bank overdraft (1,659) -

267 45,985


7. PROPERTY AND EQUIPMENT 8. INTANGIBLE ASSETS

Customer deposits carry an interest rate of 4.52% (31 December 2012: 4.88%) per annum.

Customer deposits of AED 162.7 million (31 December 2012: AED 124.7 million) are held as collateral for guarantees issued or to be issued on behalf of customers.

10. CUSTOMER DEPOSITS

31 December

2013

31 December

2012

AED'000 AED'000

Corporate term deposits 515,084 413,953

9. OTHER ASSETS

31 December

2013

31 December

2012

AED'000 AED'000

Prepaid expenses 5,554 9,302

Advances to employees 1,091 1,196

Accrued interest receivable 98 287

Deposits 760 716

Others 3,937 3,130

11,440 14,631

Less: impairment allowance (904) (173)

10,536 14,458

Computer

software

Work in

progress

Total

AED'000 AED'000 AED'000

At 31 December 2011 8,633 63 8,696

Additions 69 (63) 6

Amortisation charge (2,217) - (2,217)

At 31 December 2012 6,485 - 6,485

Additions 1,174 - 1,174

Amortisation charge (2,250) - (2,250)

At 31 December 2013 5,409 - 5,409

Office

equipment

Leasehold

improvements

Motor

vehicles

Total

AED'000 AED'000 AED'000 AED'000

Cost

At 31 December 2011 15,388 14,575 620 30,583

Additions 1,011 27 - 1,038

Transfers (76) - - (76)

At 31 December 2012 16,323 14,602 620 31,545

Additions 660 249 82 991

Disposals (274) (142) - (416)

At 31 December 2013 16,709 14,709 702 32,120

Depreciation

At 31 December 2011 (10,623) (8,295) (473) (19,391)

Charge for the year (2,126) (1,915) (74) (4,115)

Disposals 74 - - 74

At 31 December 2012 (12,675) (10,210) (547) (23,432)

Charge for the year (1,743) (1,499) (66) (3,308)

Disposals 260 123 - 383

(14,158) (11,586) (613) (26,357)

Net book value

At 31 December 2013 2,551 3,123 89 5,763

At 31 December 2012 3,648 4,392 73 8,113


11. RELATED PARTY TRANSACTIONS AND BALANCES

Related parties comprise of shareholders and directors of the Company, entities controlled by them and the key management personnel of the Company. During the period the Company entered into the following significant transactions with related parties in the ordinary course of business at mutually agreed terms and conditions.

(a) Transactions with key managerial personnel

Key managerial remuneration comprise:

The balances due to related parties are payable on demand and bear no interest.

(c) Balances with related parties

Balances with related parties are as follows:

(b) Other related party transactions

The Company has entered into the following significant transactions with related parties in the ordinary course of business:

12. BORROWINGS

13. PROVISION FOR EMPLOYEES’ END OF SERVICE BENEFITS

The provision for end of service benefits due to expatriate employees is made in accordance with the UAE Labour Law for their periods of service up to the balance sheet date. In accordance with the provisions of IAS 19, an actuary has carried out an exercise to assess the present value of its obligations as at 31 December 2013, using the projected unit credit method, in respect of employees’ end of service benefits payable under the UAE Labour Law. The expected liability at the date of leaving the service has been discounted to its net present value using a discount rate of 4.48%. (2012: 3.25%). Under this method an assessment has been made of an employee’s expected service life with the Company and the expected basic salary at the date of leaving the service. The actuary has assumed average annual increment/promotion costs of 6.0% for the next four years and 3.0% thereafter (2012: 6%). The transfer to Dunia Services FZ LLC represents the actuarial value of liability in respect of the employees who have been transferred to Dunia Services FZ LLC for the period of service in Dunia Finance.

Maturity profile of undrawn facilities:

The Company has bank facilities of AED 190 million comprising of overdraft facilities of AED 40 million and term loan

facility of AED 150 million.

31 December

2013

31 December

2012

AED'000 AED'000

Bank overdraft 1,659 -

Term loan - -

1,659 -

31 December

2013

31 December

2012

AED'000 AED'000

Floating rate

Expiring within one year 38,341 -

Expiring beyond one year 150,000 -

188,341 -

31 December

2013

31 December

2012

AED'000 AED'000

At beginning of the year 5,622 4,729

Charge for the year 1,422 1,797

Transfer to Dunia Services FZ LLC (Note 11) (2,474) -

Payments during the year (742) (904)

At end of the year 3,828 5,622

31 December

2013

31 December

2012

AED'000 AED'000

Salaries and other short-term employee benefits 12,185 12,513

Other employee benefits 632 307

31 December

2013

31 December

2012

AED'000 AED'000

(a) End of services benefits

Transfer of end of service benefits to Dunia Services FZ LLC (Note 13) 2,474 -

(b) Expenses

Fees charged by Dunia Services FZ LLC for the provision of business and knowledge processing services on mutually agreed terms. 26,369 -

Reimbursement of expenses paid by a shareholder for the purpose of financing operating expenses incurred by the Company and other contractual payments for services rendered.

6,280 7,126

32,649 7,126

31 December 2013 31 December

2012

AED'000 AED'000

Due to related party 23,604 642


14. OTHER LIABILITIES

15. SHARE CAPITAL

18. STATUTORY RESERVE

In accordance with the UAE Federal Law No (8) of 1984 as amended, and the UAE Union Law No. 10 of 1980, as amended, 10% of the net profit for the year is transferred to a legal reserve, until such time as the balance in the reserve equals 50% of the issued share capital. This reserve is not available for distribution. Accordingly, AED 11.8 million was transferred to the statutory reserve on 31 December 2013 (31 December 2012: AED 7.3 million).

19. INTEREST INCOME AND EXPENSE

20. FEES AND COMMISSION INCOME

Fees and commission income includes a sum of AED 22.9 million (31 December 2012: AED 34 million) recognised from the provision of advisory services by the Company.

21. IMPAIRMENT CHARGE, NET

16. DIVIDENDS

Dividends of AED 8,800,000 (AED 16 per share) relating to the year ended 31 December 2012 was paid during the year ended 31 December 2013. An interim cash dividend amounting to AED 8,800,000 for the year ended 31 December 2013 was proposed and paid during the year.

The Board of Directors at their meeting held on February 17, 2014 proposed a final cash dividend of AED 16 per share amounting to AED 8,800,000.

17. OTHER EMPLOYEE BENEFITS

Certain employees are entitled to cash payments under an equity based payment scheme (“the scheme”) implemented by the Company. The cash payments are determined on the basis of the book value of the shares of the Company at the end of each of its financial years commencing 2013 to 2015 and subject to the condition that the Company achieves its budgeted results during the seven year period covered by the scheme.

The accrual in respect of the scheme as at 31 December 2013 is AED 12.6 million (2012: AED 10.9 million) and is determined on the basis of the assumption that most of the eligible employees will remain with the Company during the period covered by the scheme and the Company will achieve its budgeted results during each of the years covered by the scheme.

The Company establishes and implements annual Long Term Incentive Plans in the form of deferred cash plans payable over three successive years. These benefits are expected to be settled on the anniversary of the grant in each of three successive years following the year in which the annual award was granted.

As on 31 December 2013 the accrual in respect of the scheme is AED 4.4 million (2012: AED 6.2 million) and is determined on the basis of the assumption that all the eligible employees will remain with the Company during the period covered by the scheme.


AED'000 AED'000

Impairment charge on loans and advances (Note 6) 45,953 51,414

Loans and advances written off (Note 3.1.5) 51,307 28,818

Impairment charge on other assets 731 42

97,991 80,274

Recovery of loans and advances (11,934) (8,239)

86,057 72,035


AED'000 AED'000

Interest income

- on loans and advances 279,202 208,544

- on deposits with banks 373 534

279,575 209,078

Interest expense

- on customer deposits 19,691 15,848

- on borrowings 233 1,243

19,924 17,091

31 December

2013

31 December

2012

AED'000 AED'000

Authorised, issued and paid up share capital :

550,000 shares of AED 1,000 each 550,000 550,000

31 December

2013

31 December

2012

AED'000 AED'000

Accrued expenses 45,829 44,549

Sundry creditors 10,670 20,678

Deferred fee and commission income 8,548 8,320

Other employee benefits (Note 17) 16,978 17,096

Others 1,253 755

83,278 91,398


22. GENERAL AND ADMINISTRATIVE EXPENSES

23. STAFF COSTS


AED'000 AED'000

Outsourced services 49,430 38,540

Staff costs (Note 23) 52,035 46,820

Occupancy costs 8,731 11,914

Information technology expenses 6,961 7,341

Advertising, publicity and promotional expenses 4,308 2,479

Legal and professional fees 1,521 1,570

Loss on disposal of fixed assets 34 -

Bank charges 3,509 3,473

Visa expenses 1,576 3,018

Other expenses 15,672 14,414

143,777 129,569

31 December

2013

31 December

2012

AED'000 AED'000

Unused credit card limits 593,419 306,479

Financial guarantees 162,705 124,577

756,124 431,056

31 December

2013

31 December

2012

AED'000 AED'000

No later than 1 year 3,011 4,646

Later than 1 year and no later than 5 years 10,838 6,118

Later than 5 years - -

13,849 10,764

24. CONTINGENT LIABILITIES AND COMMITMENTS

(a) Operating lease commitments

The future minimum lease payments under non-cancellable operating leases for properties are as follows:

The total outstanding contractual amount of commitment towards unused credit card limits does not necessarily represent future cash requirements, since these credit card limits may not be fully utilised and are revocable at the option of the company.

Financial guarantees represent guarantees issued by the Company on behalf of customers favouring the UAE Ministry of Labour and other government bodies and are substantially secured by cash collateral.

(c) Capital commitments

At 31 December 2013, the Company has capital commitments of AED 55,000 (31 December 2012 : AED 230,000).

(b) Commitment to extend credit and guarantees


AED'000 AED'000

Salaries and other benefits 48,889 44,101

Employees’ end of service benefits 1,422 1,797

Other employee benefits 1,724 922

52,035 46,820

dunia Annual Report FY 2013

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