ABU DHABI / WAM
The total combined assets of National Bank of Abu Dhabi (NBAD) and First Gulf Bank (FGB) jumped to AED665.8 billion at the end of 2016, as revealed before the execution of a planned merger during the 1st quarter of the current year. The same financial data showed a rise in their combined deposits to around AED402.58 billion and loans to AED357.2 billion at the end of 2016. â€œThe two banks will meet with the Securities and Commodities Authority, SCA, in the next two months for final approval of the merger to agree the timetable for implementation,â€ said the SCA in an exclusive statement to Emirates News Agency, WAM.
Bankers have confirmed that the expected merger would result in the establishment of the largest banking entity in Mideast. This could encourage more mergers between banking entities operating in similar sectors, including those in UAE. The planned merger is expected to achieve a decrease in annual costs of around AED500mn annually, while the profit in terms will be reaped over a period of three years. The one-time cost of unifying the businesses is estimated at AED600 million. The General Assemblies for NBAD and FGB agreed to set July 12, 2016, as date for merger in accordance with Article 283 (1) of Federal Law Number 2 for 2015, which applies to commercial companies.