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Abu Dhabi Islamic Bank weighs merger amid M&A wave

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The lender is said to be in early talks with financial advisers about measures such as combining with a larger entity or buying a smaller institution.

Thursday 14, February 2019

(Bloomberg) --Abu Dhabi Islamic Bank (ADIB) is weighing strategic options for its business, including a potential merger, according to people with knowledge of the matter.

ADIB would prefer to acquire another lender rather than being taken over, two of the people said. A formal process hasn’t started and talks may not result in a deal, the people said. Senior executives at Abu Dhabi Islamic Bank weren’t immediately available for comment.

Abu Dhabi, home to about six per cent of global oil reserves, is stepping up efforts to create leaner and more competitive banks after a slump in crude prices. Abu Dhabi Commercial Bank is in the process of merging with Union National Bank and Al Hilal Bank after a tie-up between Abu Dhabi’s two biggest banks in 2017. With about 50 lenders competing in a market of about nine million people, smaller banks are coming under pressure.

Abu Dhabi Islamic Bank has about $34 billion in assets and a market value of $4.2 billion. In November, it got approval to allow foreigners to own up to 25 per cent of its shares, which have gained 10 per cent this year.

The bank plans to hire former Credit Agricole banker Mazin Manna to replace acting Chief Executive Officer Khamis Buharoon, people familiar with the plans said in December.

 

TAGS : ADIB, Abu Dhabi Commercial Bank, Union National Bank, Al Hilal Bank, Abu Dhabi Islamic Bank, Abu Dhabi bank merger

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