There was a piece in the Khaleej Times today with more commentary about the NBD EBI bank merger announced early in March 2007.
Included were some comments about other possible bank mergers...
Interesting that NBAD and ADCB were named as possible candidates. Both of them made comments recently that could be interpreted as if they were considering a merger (not necessarily with each other)...
And NBD chairman, Abdulla Mohammed Saleh, said: "The merger gives us the advantage to capitalise on the unique strengths of both banks to serve our customers better and deliver greater shareholder value."
Within the wider financial community, there is also the expectation that the NBD-EBI merger will open the door for other bank mergers across the region. As CEO of Dubai Bank, Abdulaziz Al Muhairi, commented to Khaleej Times:
"Particularly in focus will be the two large Abu Dhabi banks, National Bank of Abu Dhabi (NBAD) and Abu Dhabi Commercial Bank (ADCB), that are primed for a possible merger with other banks (or possibly even between themselves) as the EBI/NBD merger relegates them to lower rungs of the 'largest UAE banks' ladder."
"Additionally, in view of the number of bilateral trade agreements (FTAs) under negotiation between the UAE and a number of countries/blocks, as well as the World Trade Organisation (WTO) agreement, there is the threat of super-sized banks from major money centres in the US, Europe and other regions entering the UAE banking scene and intensifying the competition. Therefore, it would definitely be in the interests of smaller banks in the UAE to merge, in order to compete with such colossuses that are set to appear.
"Not to mention the fact that, by some accounts, the UAE, with more than 47 banks in operation, is over-banked and consolidation in the banking sector is inevitable."
Some heavy trading and strong rises in some DFM and ADSM bank shares today. The share market doesn't appear to think much of all the denials of bank mergers recently then?
ADIB up 5% so far
DIB up 3% (on strong volume)
FGB up 3% (on huge volume - but mostly due to one trade of almost 7m shares at 11.45 dhs)
UNB up 3%
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2008 FY
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