Yesterday, the Abu Dhabi Islamic Bank (ADIB) announced it completed a secondary market transaction using blockchain trade finance platform TradeAssets. It sold part of its trade finance portfolio to banks in multiple jurisdictions, in what is referred to as ‘trade finance distribution.”
Most banks limit the amount of trade finance that they can take onto their balance sheets. If they hit their maximum, instead of telling corporates they cannot help them, banks can continue providing finance if they sell off part of their portfolio.
ADIB offers Sharia-compliant banking services and has over AED 124.6 billion ($33.76 billion) in assets. The bank has been working with Dubai-based TradeAssets for a year to automate trade finance transactions and digitize traditional processes. It is also a member of UAE Trade Connect another blockchain trade finance platform that includes some of the UAE’s largest banks.
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