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A $1 billion deal to acquire Egypt's biggest investment bank was pulled in April. It set its sights higher after a few months.
FAB, which has grown into the Middle East's largest bank by assets since it was created through a merger about six years ago, said on Thursday that it is no longer considering an offer for the London- based lender.
A successful deal would have catapulted the regional champion into an emerging markets banking giant with more than $1 trillion in assets, making it the biggest foreign takeover by a company in the Gulf region.
The growing ambition of Middle East lenders and the wealthy oil-rich nations that back them is highlighted by FAB. It shows Abu Dhabi's desire to play a bigger role on the international stage and would have marked a turning point in Hana Al Rostamani's two year reign.
The ambition of Abu Dhabi Inc. in growing its financial services reach to new geographic territories is demonstrated by the fact that FAB have looked at merging. The thought process of looking to grow infinitely rather than gradually to leap in size over local and regional competition is emphasized by the interest.
The lender's market value is roughly double that of Standard Chartered.
FAB has the backing of some of the world's biggest investors, which it may have needed to get a deal done.
The current balance sheet of EFG-Hermes would not allow a takeover, according to a research analyst. The key shareholders of Mubadala would have had to participate in the rights issue.
The Al Nahyan family is the world's richest with a $300 million fortune.
The Emirate's SWFs have more than one trillion dollars in assets.
The source is the Global SWF.
With cash from last year's commodity boom and spurred on by equally ambitious neighbors such as Qatar and Saudi Arabia, the U.A. is investing billions of dollars to diversify its economy away from crude.
A powerful royal family member is at the center of those ambitions. Sheikh Tahnoon has taken on a more prominent role in the past few years. He is the head of Royal Group and ADQ, which oversees many key Abu Dhabi assets.
In 2016 the National Bank of Abu Dhabi PJSC and First Gulf Bank PJSC were combined into one lender. The main goal of the new entity was to lend to state entities and the private sector. NBAD was bigger in wholesale banking and had expanded internationally under a CEO who had spent two decades at STANDARD STANLEY.
At the end of September, FAB had $312 billion in assets, making it one of the top investment banks in the world. That is less than Standard Chartered's $864 billion. State and public sector companies have large accounts with the bank due to its close ties to the Abu Dhabi government.
First Abu Dhabi Bank’s interest in acquiring Standard Chartered — after over six months of assessment — despite being abandoned, underpins the desire of large local peers to expand their international footprints outside the Gulf region. The aim being to source liquidity, acquire expertise and diversify revenue.
Edmond Christou, senior BI analyst. Read more here
The bank has a presence in 19 countries outside of its home market and three quarters of its revenue comes from the United States. Last year, the lender worked on several high-profile transactions across the Gulf and derives about 45% of its revenue from investment banking.
The bank bought the Egyptian unit in 2021. It withdrew a billion-dollar bid for EFG-Hermes due to regulatory delays in Egypt.
If the right opportunity arises, the FAB is willing to do it at scale. It would have been a challenge for the management to put together the financing and face the operational challenges.
One of the banking industry's rare female CEOs is now one of the group chief executive officers.
Several executives have left the company since then as a result of the management changes. James Burdett, the CFO, recently said he was retiring.
The challenging global backdrop calls for caution, with the risk of a recession in several economies, according to the third quarter results presentation.
She said that they were confident in the resilience of the region and that they were well placed to deliver market-leading shareholder returns.
The status of the Middle East's biggest lender has been a point of contention for many years. Both banks have outlined their intentions to grow internationally, but so far it has been limited to their domestic markets.
Gulf-based banks are starting to look outside of their region. Saudi National Bank made an investment late last year.
Middle Eastern investors have supported European banks for a long time. The Saudi conglomerate is one of Credit Suisse's top investors. The region invested billions in banks during the financial crisis.
Under certain circumstances, including a third party announcing a firm intention to make an offer, FAB will not be able to make an offer for Standard chartered in the next six months.
It makes sense for the lender to hold out for a bigger deal.
He said that the market will benefit more in future of such deals if they took place, rather than looking at local mergers in the U.S. which won't benefit the market as much as international ones.
With the help of a woman.
(Updates with Bloomberg Intelligence comment.)
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