New name for EBI-NBD is at approval stage: Al Tayer

DUBAI — The boards of directors of Emirates Bank International (EBI) and The National Bank of Dubai (NBD) have approved the terms and conditions of the merger, according to a statement posted on the Dubai Financial Market. The next step is for the shareholders of both banks to approve the merger.

By Lucia Dore (Assistant Editor, Business)

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Published: Tue 3 Jul 2007, 8:52 AM

Last updated: Sat 4 Apr 2015, 10:12 PM

The statement also said that the banks' shares have been suspended from trading for 15 days from 8am yesterday. The reason given for the suspension is to give both banks time to pursue the necessary approvals from the regulatory authorities.

Separately, the chairman of Emirates Bank, Ahmed Humaid Al Tayer, said the name for the newly merged bank is in the "approval stage". And he ruled out the likelihood of any further mergers in the near future. "The (EBI and NBD) merger is going ahead and this is enough for this year," he said.

Speaking to Press at the inauguration of the new headquarters of the group sales unit at Deira Creek, Al Tayer also said the merger follows a trend set by European banks in the 1990s to create larger, more competitive entities, and comes at a time when banks in the region are seeing ever-tightening margins. "The region is still catching up," he said.

With 45 national and foreign banks in the country, competition is becoming increasingly intense and national banks need to become larger to compete with foreign ones, he said. And as the WTO further liberalises financial services, the argument for creating a superior merged entity becomes even more compelling.

The merged entity will create the largest bank in the GCC and the MENA region with combined assets of $45 billion. This move is required so that "we have more capacity to grow and to compete," he said, adding: "There will be increasing capacity for project financing."

Commenting on the bank's results for the first quarter of the year and the strong performance of banks generally, Al Tayer said they were "remarkable". This year growth has come from the core business, he said, and has not been boosted by IPOs.

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