Retention of profits to finance future projects, giving higher level of dividends and timely information in the form of investors’ presentation on website mean the managers of NBAD are actually in line and performing in the interest of shareholders. NBAD board of directors also has a number of independent and non executive directors who scrutinize the bank’s performance in the best interest of shareholders. Debt holders can find relevant information regarding shareholders on NBAD’s website, through analyst’s covering the bank and recent developments. The bond rating of NBAD is very high and they have lowest credit risk so is very less risk involved for debt holders. We can further look to the level of cash balances maintained in previous years. The high level of cash balances is a good sign from debt holders’ perspective and it may also means that a firm is not using all resources on risky and bad projects. The of cash maintained in previous years was higher as compared to a significant decrease in 2011. The decreased level of cash may put doubts on the credit risk of the bank in future and thus the ratings however as long as the bank is using these resources in profitable opportunities they will earn better returns. The bank has set a number of targets for the future includes entering into new markets such as India, Iraq and Brazil to increase the geographical diversification, investing in SME segments and achieving 16bn Net Profit in 10 years time at the growth rate of 16%. The targets are
Retention of profits to finance future projects, giving higher level of dividends and timely information in the form of investors’ presentation on website mean the managers of NBAD are actually in line and performing in the interest of shareholders. NBAD board of directors also has a number of independent and non executive directors who scrutinize the bank’s performance in the best interest of shareholders. Debt holders can find relevant information regarding shareholders on NBAD’s website, through analyst’s covering the bank and recent developments. The bond rating of NBAD is very high and they have lowest credit risk so is very less risk involved for debt holders. We can further look to the level of cash balances maintained in previous years. The high level of cash balances is a good sign from debt holders’ perspective and it may also means that a firm is not using all resources on risky and bad projects. The of cash maintained in previous years was higher as compared to a significant decrease in 2011. The decreased level of cash may put doubts on the credit risk of the bank in future and thus the ratings however as long as the bank is using these resources in profitable opportunities they will earn better returns. The bank has set a number of targets for the future includes entering into new markets such as India, Iraq and Brazil to increase the geographical diversification, investing in SME segments and achieving 16bn Net Profit in 10 years time at the growth rate of 16%. The targets are
my-corporate-finance-project.docx