Shuaa Capital, the Dubai government-controlled investment bank, has cut about 15 per cent of its staff ahead of a possible sale of a stake in the company.
Before the lay-offs, which took place at the end of last week, the bank had about 70 employees, news agency Reuters cited people familiar with the matter as saying. Shuaa did not respond to comment.
Dubai Group , a unit of Dubai Holding, the investment vehicle of the emirates ruler, mandated Emirates NBD in April to arrange a sales process for its 48 per cent stake in Shuaa. The stake is worth about AED315m ($86 million) at stock market prices.
It was not immediately known whether the lay-offs were related to the sales process, according to the news agency.
Shuaa is the latest financial institution in the UAE to lay off workers. Emirates NBD (ENBD), the biggest lender in the emirate has closed down operations of its subsidiary Emirates Money as the lender restructures its business lines to save costs, a spokesman of the bank confirmed to MEED in April. ENBDs sharia-compliant arm, Emirates Islamic (EI) earlier this year slashed about 200 jobs as part of a wider organisational restructuring, sources familiar with the situation told MEED.
The lenders are grappling with government withdrawals, tightening liquidity, stunted loan growth and exposure to high-risk sectors such as contracting and property finance as the regions economy slows on the back of low oil prices.
National Bank of Ras al-Khaimah (RAKBank), an Abu Dhabi-listed lender, shed close to 250 jobs in January, while First Gulf Bank (FGB), the countrys third-biggest bank by assets, cut 100 jobs in December from various departments including corporate and investment banking.
UK-based Barclays laid off about 150 people from its corporate banking department in February as part of a wider restructuring of its global business. The UKs HSBC has also cut more than 150 jobs from its UAE banking operations, as Europes biggest lender implements its global downsizing plans amid declining profitability.
Similarly, UK-based Standard Chartered has reduced the headcount of senior-to-mid-level bankers in the UAE by about 100.