The acquisition cements Dubai Islamic Bank’s position as one of the world’s largest Islamic finance institutions/Bloombergby Kudakwashe Muzoriwa
UAE’s Dubai Islamic Bank (DIB) is progressing with the acquisition of Noor Bank whose board of directors has been reconstituted to ensure a seamless integration plan.
Following the reshuffle, Noor Bank’s board of directors now includes Adnan Chilwan, the Group CEO of DIB and Yahya Saeed Ahmed Nasser Lootah, Hamad Buamim as well as Ahmad Mohammad Saeed Bin Humaidan and Abdulla Ali Obaid Al Hamli—all current board members in DIB:
DIB stated that the appointed members of the interim board will be responsible for the management of Noor Bank and implementation of the integration plan in order to effectively realise the benefits of the acquisition and unlock value for all stakeholders.
DIB shareholders gave approval for the acquisition through an increase of the bank’s capital from 6.6 billion shares to 7.2 billion shares, with a share swap ratio of one new share in DIB for every 5.49 Noor Bank shares, translating into an issuance of about 651 million new DIB shares.
The acquisition cements DIB’s position as one of the world’s largest Islamic finance institutions and is expected to enhance Dubai’s position as the capital of Islamic economy by creating the region’s most progressive Shari’ah-compliant banking group.
The GCC financial services industry is witnessing a wave of consolidation as banks seek ways to improve competitiveness and boost capital amid slowing economic growth.
The Abu Dhabi government completed the merger of Abu Dhabi Commercial Bank, United National Bank and Al Hilal Bank following the successful tie-up of its two major banks to become First Abu Dhabi Bank in 2017.
Similarly, the Central Bank of Kuwait ‘conditionally’ approved the proposed merger between Kuwait Financial House (KFH) and Bahrain’s Ahli United Bank (AUB). CBK granted KFH permission to acquire 100 per cent of the capital shares of AUB and the approval shall be conditional upon fulfilling certain requirements by the central bank.
Moody’s said that the outlook for GCC banks remains stable, except Oman, underpinned by solid economic growth as well as the banks’ strong capital buffers and substantial liquidity.
Saudi British Bank (SABB) and Alawwal agreed to merge their businesses in June 2019, after receiving regulatory and shareholder approvals, creating the third-largest bank by assets in the Kingdom.