FGB and NBAD shareholders approve the merger to create UAE’s largest bank

Shareholders in First Gulf Bank PJSC (FGB) and National Bank of Abu Dhabi PJSC (NBAD) have approved a proposed merger of the two banks, which will create the largest financial institution in the United Arab Emirates (UAE) with assets of approximately AED655 billion (US$178 billion).

At separate general assembly meetings held on December 7, shareholders in FGB and NBAD voted in favour of the merger, which was recommended by the board of directors of both banks on July 3. The approval of at least 75 per cent by value of the shares represented at FGB and NBAD quorate general assembly meetings was required to proceed with the merger.

His Highness Sheikh Tahnoon Bin Zayed Al Nahyan, Chairman of FGB, commented: “The overwhelming vote of support from FGB and NBAD shareholders to approve this historic merger is a clear testament to the compelling rationale and value proposition for creating a bank with the financial strength, scale and expertise to deliver benefits for our customers, our shareholders and for the wider UAE economy.”   

His Excellency Nasser Ahmed Alsowaidi, Chairman of NBAD, said: “The resounding endorsement for the combined bank from both sets of shareholders represents a significant milestone. The new larger bank will be in an excellent position to invest in our people, in technology, in products and services that our increasingly sophisticated client base demands, while capitalising on growth opportunities in the UAE and beyond”.

Shareholders from both banks voted in favour of all agenda items at each general assembly meeting, including the authorisation of the combined bank’s board of directors once the merger becomes effective.  His Highness Sheikh Tahnoon Bin Zayed Al Nahyan is the Chairman designate, while His Excellency Nasser Ahmed Alsowaidi is the Vice Chairman designate. Mr. Abdulhamid M. Saeed, who is currently Board Member and Managing Director of FGB, is the Chief Executive Officer designate for the combined bank.

Mr. Abdulhamid M. Saeed, Chief Executive Officer Designate, added: “Since the announcement of the planned merger in July, both banks have made strong progress towards integration. The vote of confidence from shareholders to create the largest bank in the UAE is based on an understanding that bringing together the best talents from FGB and NBAD and will create a market-leading product offering both in Personal Banking as well as in Corporate and Investment Banking locally and overseas.” 

The recommended transaction will involve a share swap, in which FGB shareholders receive 1.254 NBAD shares for each FGB share they hold.  Following the issue of new NBAD shares, FGB shareholders will own approximately 52 percent of the combined bank, with NBAD shareholders owning approximately 48 percent. The Government of Abu Dhabi and Government related entities will own approximately 37 percent of the merged entity.

On the effective date of the merger, FGB shares will be delisted from the Abu Dhabi Securities Exchange (ADX) and the company dissolved.

The merger has been approved by the Central Bank of the UAE, and requires further approval from international regulators and the Securities and Commodities Authority (SCA) before it becomes effective, which is expected to occur towards the end of the first quarter of 2017. Following the shareholder approval, a 30-day creditor objection period will be triggered on December 12, 2016.

For further information on the transaction, please visit: www.bankfortheUAE.com.