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Dubai: Financial experts and analysts yesterday welcomed the merger of Emirates Bank International and National Bank of Dubai to form the UAE's largest financial institution.
"It's a very good move," said Karti Inamdar, banking analyst with Capital Intelligence. "I actually see plus-points all the way in a friendly merger of two healthy banks," he said.
Trading in shares of both the banks was halted yesterday on the Dubai Financial Market (DFM) following the announcement of the merger.
Experts also saw the merger as a precursor to a coming wave of mergers and acquisitions in the financial sector.
DFM chief Eisa Kazim said the bourse stopped trading in the banks' shares due to a lack of satisfactory details on the transaction. In a joint statement, the two banks have informed the DFM that they plan to become a single entity.
The merger, which has the approval of the Dubai Government, will create the largest bank in the UAE with Dh165 billion in assets.
No details about how the merger process will proceed have been announced yet.
"It is premature at this stage to give concrete information on the process related to the merger," NBD chairman and deputy chairman of the new entity Abdullah Mohammad Saleh said in a statement.
Nasser Saidi, chief economist for the Dubai International Financial Centre, felt other banks may consider similar moves.
Standard & Poor's also announced an upgrading of the outlook on the credit ratings of the banks from "stable" to "positive".
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