Dubai’s MAF reviewing options credit card business: sources

Thu, 2019-10-10 10:05

DUBAI: Dubai’s Majid Al Futtaim, which operates the Middle
East franchise of French retailer Carrefour, is exploring options
for its credit card business including enlisting partners to manage
unsecured credit risk, two banking sources told Reuters.
The economy in Dubai is suffering from sluggish growth due to a
real estate downturn and slowing global trade, hitting white-collar
jobs and consumer spending.
MAF, a holding company which also owns and operates shopping
centers in the Middle East and North Africa, hired US investment
bank Moelis & Co. at the start of the summer to advise and
manage the partial sale of its Najm credit cards, said the sources,
who declined to be named.
Should a transaction follow, MAF would hold on to the data portion
of the card business and its loyalty program, while the banks would
acquire the loan portfolio, the sources said.
MAF said it continues to explore and evaluate opportunities that
support the sustainable growth of its business.
“We are evolving our consumer finance business, Najm, to ensure
that it meets the changing needs of its customers and the growing
demand for its products,” it said in a statement.
“We believe that consumer finance has a strong runway for growth
and fully intend to leverage this for the benefit of our customers
and partners,” it added.
US lender Citigroup, and UAE lenders Mashreq Bank and First Abu
Dhabi Bank (FAB) have been shortlisted as bidders for the business,
which is valued between $200 million and $250 million, one of the
sources said.
Citi and Moelis declined to comment, while FAB and Mashreqbank were
not immediately available to comment on Thursday.
The move would help MAF bring in a partner that is expert in
managing credit risk, while the retail conglomerate can continue to
hold onto loyalty and customer data, two sources said.
The deal could also help potentially outsource some of the IT and
back office work, one of the sources said.

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Source: FS – All-News-Economy
Dubai’s MAF reviewing options credit card business: sources