November 14, 2018 / 9:36 AM / a month ago

Abu Dhabi Commercial Bank picks Barclays to advise on merger: sources

ABU DHABI/DUBAI (Reuters) - Barclays (BARC.L) has been appointed by Abu Dhabi Commercial Bank (ADCB) ADCB.AD to advise on a potential merger plan involving Union National Bank (UNB) UNB.AD and Al Hilal Bank, banking sources told Reuters.

FILE PHOTO - Workers are seen in at Barclays bank offices in the Canary Wharf financial district in London, Britain, November 17, 2017. Picture taken November 17, 2017. REUTERS/Toby Melville

The merger, announced by the banks in September, is the latest consolidation among state-owned companies in the United Arab Emirates’ (UAE) capital.

ADCB, majority owned by the Abu Dhabi government and the second largest bank in the emirate after First Abu Dhabi Bank (FAB) FAB.AD, declined to comment. Barclays also declined to comment.

If it goes ahead, a merger of the trio could create an entity with around $113 billion in assets, according to Refinitiv data, and the UAE’s third-biggest lender after FAB and Emirates NBD ENBD.DU.

A separate source said two banks could be created out of the consolidation, with the conventional banking units of ADCB and UNB merging to create one lender.

Another could be formed through combining the Islamic banking units of ADCB and UNB, along with Al Hilal.

AlKhaleej newspaper reported the same arrangement was being considered last month, citing sources.

The tie-up was at an early stage, UAE Central Bank governor Mubarak Rashed al-Mansoori told reporters last week on the sidelines of a conference, adding he expected more consolidation in the future.

FAB was created by last year’s merger between National Bank of Abu Dhabi and First Gulf Bank.

The emirate of Sharjah is weighing a merger between three of its banks - Bank of Sharjah BOS.AD, Invest Bank INVB.AD and United Arab Bank UAB.AD, Reuters reported in September, citing sources.

Reporting by Stanley Carvalho, Saeed Azhar and Tom Arnold; Additional reporting by Alexander Cornwell; Editing by Mark Potter

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