The Banking Executive Magazine - March 2022 Issue

SHUAA Capital PROACTIVE REDUCTION OF NON-CORE ASSETS AND DELEVERAGING OF BALANCE SHEET During the year, the Group contin- ued to proactively manage its bal- ance sheet. In line with our strategy to focus on our two core business segments (asset management and in- vestment banking) and strengthen our balance sheet, the Group contin- ued to further manage down the as- sets held within its non-core unit. Since inception this unit has gener- ated net AED 188 million of cash proceeds for the Group. Following the progress in disposing of these as- sets, the non-core unit was closed in the fourth quarter of 2021 and the residual assets transferred to princi- pal investments, where they can be managed consistently and in line with the Group’s other investments. As well as the closure of the non- core unit, the Group restructured an illiquid, legacy portfolio absorbing the effects in the year. These activi- ties saw the Group reduce its ad- justed1 leverage ratio by 17% points. STRENGTHENING OUR OFFERING AND DELIVERING FOR CLIENTS In 2021, SHUAA made key hires across the business, notably within real estate and client coverage, with core headcount increasing by 33%. As well as the internal promotion of two senior executives, announced in April, this ensured that the Group maintained its policy of targeted in- vestment across both product and client relationship capabilities. The Group’s asset management ac- tivities delivered a strong perform- ance during the year, building on the progress made in 2020. The appoint- ment of a new CEO of real estate fur- ther enhances the Group’s ability to deliver a high-quality offering to clients across different geographies and markets. The Group’s flagship Goldilocks fund continued to be active in public mar- kets, identifying investment opportu- nities focused on high intrinsic value and company-specific turnarounds. It maintained its record of strong out- performance against its benchmarks during 2021 and has risen 241% since inception*. Within private mar- kets, the 2020 transaction that saw the Thalassa fund acquire Stanford Marine Group had its first full year with strong performance in the un- derlying business creating value for the shareholders in the fund. Within Debt, launched as a vertical in 2020, the team successfully structured and invested in the USD 50 million sukuk issuance of Pure Harvest, an innova- tive transaction helping a local early- stage business to secure venture debt funding from capital markets. OUTLOOK While the Group continues to oper- ate against a backdrop of global geopolitical uncertainty and height- ened market volatility, the continued progress within the core of the busi- ness since the merger of SHUAA Capital and Abu Dhabi Financial Group in 2019 allows management to remain confident about the Group’s ability to build on its market- leading position and deliver signifi- cant value creation for its investors and its shareholders. Fadhel Al Ali, Chairman of SHUAA Capital, commented: “Despite con- tinued wider market instability, SHUAA has focused on continuing to deliver for our clients. The model of partnering local capabilities has seen a number of high-profile suc- cesses in areas we can look to repeat this success, not least the Investment Banking team’s work on behalf of Anghami. We expect this model to continue to benefit both clients and shareholders in the future.” Commenting on SHUAA’s 2021 pre- liminary results, Jassim Alseddiqi, Group Chief Executive Officer of SHUAA Capital, said: “SHUAA has continued to progress during the year in broadening its client offering. As we move towards the end of clean- ing up legacy and non-core invest- ments and portfolios, we will increase our focus on driving rev- enues and shareholder returns whilst maintaining a strict discipline on costs. We are continually looking for new ways to meet the demand from both existing and new clients and we remain confident about the numer- ous and long-term opportunities for our business which will create value for our shareholders.” ISSUE 159 MARCH 2022 the BANKING EXECUTIVE 33