National Bank of Fujairah (NBF) said it would step in and meet the funding needs of diamond manufacturers and traders after the Antwerp Diamond Bank (ADB), once a leader in its field, closed its global operations last year.
NBF’s move to create a specialised team to fund diamond cutters, polishers and traders comes as Dubai vies with Antwerp, Belgium, to become the world’s biggest diamond hub.
The Fujairah-based lender said it had brought on board industry experts from ADB, which had a Dubai office, to run its new division and will focus mostly on providing short-term purchase and sales financing to established diamond businesses that ship raw diamonds from producing countries in Africa and Europe to manufacturers in India and the Far East. ADB shut its doors after its owner, KBC Bank in Ireland, failed to find a buyer.
“Our competitive advantage lies in the bank’s track record for operational excellence and compliance, its strong client relationships in the jewellery and gold sectors and now the in-house expertise from ADB, all of which would help NBF play a definitive role in the development of the diamond trade in the UAE,” said Vikram Pradhan, NBF’s head of corporate and institutional banking.
Dubai’s diamond trade was valued at nearly US$35 billion last year, up from less than $5 million in 2001, according to the Dubai Diamond Exchange, a regional trading hub overseen by the Dubai Multi Commodities Centre (DMCC). That compares to the $55bn worth of diamonds traded in Antwerp last year, according to the Antwerp World Diamond Centre, an industry association that supports the city’s diamond business.
“One of the factors crucial to Dubai’s ongoing success as a global diamond centre is financial support,” said Ahmed bin Sulayem, the executive chairman of the DMCC. “With the gradual withdrawal of multinational banks from the diamond market, it is heartening to see strong local names such as National Bank of Fujairah stepping in to take their place.”
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