Emirates NBD is to sell a major stake in Dubai Bank to Abu Dhabi-based private limited company Eradah Capital.
A statement to the Dubai Financial Market (DFM) said: “Emirates NBD Bank (PJSC) confirms that it has entered into an agreement to sell a controlling interest in Dubai Bank (PJSC) to Eradah Capital (LLC).”
The statement added that the transfer is expected to complete this year and is subject to regulatory approval by the Central Bank of the UAE.
Emirates NBD acquired Dubai Bank just under 10 years ago.
Emirates NBD PJSC, Dubai’s biggest lender, is raising around $1.75 billion in the Gulf region’s first sustainability-linked loan to refinance existing debt, according to people with knowledge of the plans.
Liquidity among banks in the six-nation Gulf Cooperation Council is improving as economies recover with a rebound in oil prices while the coronavirus pandemic subsides.
Emirates NBD has about $5.7 billion of debt maturing this year, according to data compiled by Bloomberg. The bank’s profit fell by more than half in 2020 and impairment allowances increased by 65 percent as lockdown restrictions paralysed businesses and disrupted travel to the Middle East’s commercial hub.
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