Dubai-based Noor Islamic Bank (Noor) has started the sale of the UAE gold bullion coins to retail buyers in denominations of one, half, quarter and one/tenth ounce in 99.99 per cent purity (24 karat).



The innovative product offering makes Noor the first Islamic bank in the UAE to offer a fully-fledged product in the precious metals segment, said a statement from the bank.



The initiative has been launched in partnership with the Dubai Multi Commodities Centre (DMCC), which designed and launched the UAE gold bullion coins in April 2012.



The coins are minted by Swiss refinery Argor-Heraeus, one of the world’s largest processors of precious metals and are accredited by DMCC’s Dubai Good Delivery Standard (DGD), the statement added.



Omar Anwar, the acting head of Treasury, Noor Islamic Bank, said: "Gold is primarily a long-term investment that holds the potential to offer multiple returns. However, most investors are wary of gold securities, which do not give the same assurance as physical gold since there is always a question on the ratio of global gold stocks and the issuance of certificates."



"On the other hand, storing physical gold has always posed a critical concern for investors. With the option of storage facilities, our product effectively extends a safe investment option to individuals looking for profitable yet secure avenues to park their funds," he stated.



Noor also offers gold kilo bars for larger trade quantities, which could be sourced from suppliers of choice including Argor-Heraeus, Swiss Gold, Emirates Gold and Al Etihad Gold Refinery.



Ahmed Bin Sulayem, the executive chairman, DMCC, said: “We congratulate Noor on becoming the first Islamic bank distributor of the UAE Gold Bullion Coins. These coins celebrate the accomplishments of the UAE’s visionary rulers.”



As a value-added service, Noor is also offering storage custody through an insured third party vault operator. In return, clients will be provided with certificates for physically-backed gold product, said the bank in its statement.



Alternatively, clients can take delivery of the gold, both coins and bars, through an agreed third party delivery method. The bullion can also be collected directly from the vault with prior confirmation, it added.



Gautam Sashittal, the chief operating officer, DMCC, said: “We are proud to partner with institutions such as Noor Islamic Bank, which are committed to developing innovative Islamic banking solutions. Noor represents the culture of change that is taking place in Dubai by incorporating bullion trading into its activities.”



Noor’s initiative to offer bullion coins and bars comes in response to the vast demand for the precious metal in the UAE. In 2012 alone, gold sales in the form of jewellery, bars and coins investment totalled $2.777 billion, according to the World Gold Council.-TradeArabia News Service