Abu Dhabi Investment Council’s stake in ADCB rises after lender’s capital reduction

Adic, which is an investment arm of the Abu Dhabi Government, now owns 62.52 per cent of shares in Abu Dhabi Commercial Bank, an increase of about four and a half percentage points.

ADCB is expected to report fourth-quarter earnings after its board meeting on Tuesday. Mona Al Marzooqi/ The National

Abu Dhabi Commercial Bank says its main shareholder, the Abu Dhabi Investment Council (Adic), now owns 62.52 per cent of the lender after a capital reduction.

Adic, an investment arm of the Abu Dhabi Government, previously held a 58.08 per cent stake.

The increase in Adic’s stake comes in the wake of a stock buyback programme that began in 2013 and concluded in January 2015.

As a result of the capital reduction following the share buyback programme, the bank cancelled 397,366,172 shares with the total number of shares now standing at 5,198,231,209 as a result of that cut, ADCB said on its website.

This was effective from January 10 this year, it said.

In 2013, the bank bought back 7 per cent of its shares. A subsequent buyback programme was also launched in 2014.

The stock market regulator had given the bank permission to buy 10 per cent of its share capital back.

ADCB is expected to report fourth-quarter earnings after its board meeting on Tuesday.

In a statement to the ADX yesterday, the bank said its board will meet to approve its financial results for the period to the end of 2016 and asked for its shares to be suspended from trading on Tuesday.

ADCB said in October its third-quarter profit slid by 17 per cent as provisions for bad loans jumped almost six-fold.

Net profit declined to Dh1 billion in the three months to the end of September versus Dh1.2bn in the same period last year, the bank said.

Impairment allowances shot up to Dh380 million from Dh66m in the third quarter last year.

Net interest income, the money banks make from lending, fell slightly to Dh1.35bn from Dh1.4bn in the same time frame.

“While the challenging operating environment and the turbulent markets have impacted the industry, our underlying performance and fundamentals remain strong and we continue to grow our businesses,” Ala’a Eraiqat, the chief executive, said at the time.

UAE banks have not been having the best of times since the price of oil began its long descent during summer 2014. Deposits have dwindled as government-related entities withdraw funds to help fill a growing budget deficit.

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