First Abu Dhabi Bank (FAB) “strongly denies” media reports that the bank is weighing a potential merger with Abu Dhabi Islamic Bank to create the region’s largest lender.
On Wednesday, Bloomberg – citing anonymous sources – reported that deliberations about a potential merger are “in early stages” and being discussed at the shareholder level of the banks. The report added that no advisors have been appointed and that the deal may not materialise.
A spokesperson for FAB said in a a statement, “Whilst the bank does not comment on speculation, FAB strongly denies the report issued by Bloomberg on the potential merger between FAB and ADIB.
“FAB currently has not entered discussions with ADIB to pursue any merger activity. Following the recent completion of our integration process, the bank is fully focused on unlocking its full potential and maximising shareholder value in 2019.”
ADIB, for its part, said on Thursday that it is not studying a merger with other lenders. In February the company said it is constantly studying options to strengthen its client base after Bloomberg reported that it was weighing strategic options for its business.
ADIB shares have risen as much as 5.3 percent, the most since November, while FAB’s have risen 0.1 percent.
In a report, Arqaam Capital Ltd. Analysts Jaap Meijer and Janany Vamedeva wrote that the likelihood of a deal is “high” and that “merits are strong”, according to Bloomberg.
Data compiled by Bloomberg shows that a merger between FAB and ADIB would create e lender with $236.7 billion in assets.For all the latest banking and finance news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
Subscribe to Arabian Business' newsletter to receive the latest breaking news and business stories in Dubai,the UAE and the GCC straight to your inbox.