The Banking Executive Magazine - June 2022 Issue

DGDA DGDA signs MoU with Al Rajhi Bank TO HELP FUND HOME BUYERS The Diriyah Gate Development Au- thority (DGDA) has signed a Memo- randum of Understanding (MoU) with Al Rajhi Bank to provide financ- ing options for the purchase of resi- dential property units. The agreement facilitates financing for in- dividuals looking to purchase homes in DGDA’s residential projects and bolsters cooperation on real estate investments, banking services, and other areas related to the coordina- tion, development, and implementa- tion of projects and initiatives. The MoU was signed by Jerry Inzer- illo, Group CEO of Diriyah Gate De- velopment Authority, and Waleed Al-Mogbel, Chief Executive Officer of Al Rajhi Bank. The agreement will pave the way for cooperation discus- sions across fields such as corporate and retail banking, sharia-compliant solutions, and e-commerce products intended to help DGDA improve ef- ficiency and manage administrative challenges such as import and export credit lines, bank letters of guarantee, shipping guarantee letters, and on- line supply chain finance. Addition- ally, the agreement includes cooperation with the bank’s corpo- rate banking group for solutions to manage cashflow, collection, and payments, as well as managing digi- tal payments through DGDA’s online portal. Under the terms of the MoU, the two parties will also explore the possibil- ity of the bank offering off-plan sales management using tools including an advanced user interface and re- porting system, which would enable DGDA to achieve granular visibility over its projects. The two sides also agreed to develop new ways to offer financial backing to individuals look- ing to buy homes around Diriyah, to- gether with the possibility of extending comprehensive banking services to DGDA’s staff at competi- tive rates. The MoU also covers working with Al Rajhi Bank’s insurance arm, Taka- ful, to offer Sharia-compliant insur- ance for DGDA’s properties and staff, including medical, vehicle, and sav- ings insurance policies. Mr. Inzerillo stated that one of the MoU’s main goals is the training of DGDA staff on financial manage- ment, adding that the two parties would collaborate on categorizing real estate developers according to their credit ratings, in addition to ex- changing expertise and research. “With this MoU, we aim to help en- sure financial sustainability and max- imize the returns on our assets, as well as upskill and train our people to help achieve our ambitious goals,” he commented. Meanwhile, Mr. Al-Mogbel indicated that the MoU will create potential opportunities for the creation of new real estate funds designed to finance specific types of developments, lease them, and then divest them if and when needed. He also stated that real estate funds can be founded to operate on the sell-sublet model, with cashflow and investment management tools tai- lored to each individual project, as well as joint financing with other banking institutions. In conclusion, he expressed his hope that the agree- ment would bolster collaboration be- tween the two sides to accomplish their mutual goals. ISSUE 162 JUNE 2022 the BANKING EXECUTIVE 29