United Arab Bank (UAB), which has been hit hard by a surge in defaults in the SME sector, is winding down its SME unit. The bank will now focus on larger companies in a bid to return to profit. UAB’s acting CEO Samer Tamimi said that roughly a third of the USD242 million provisions taken in 2015 stemmed from business owner and others fleeing the country with unpaid debt. He further said that the bank has now split its business into core and non-core activities. Core activities include corporate banking, supported by treasury and retail, while SME banking has been bundled into non-core activities, which accounted for around 15% of total bank loans at the end of last year. Its contribution will be cut further this year. As part of the strategy shift, UAB has been recalling loans from some of its smaller business customers, winding down existing maturities, or transferring them to its corporate unit. (Reuters)