Abu Dhabi's FAB completes merger of its Egyptian operations with Bank Audi Egypt

The combined entity is among the largest banks in Egypt and will operate under new brand identity FABMISR

First Abu Dhabi Bank, the largest bank in the UAE, is looking to expand its regional footprint. Chris Whiteoak / The National

First Abu Dhabi Bank (FAB) has completed the merger of Bank Audi Egypt with its Egyptian operations, consolidating its market position in the most populous Arab country.

The combined entity will operate under FAB’s new brand identity in Egypt, FABMISR. The lender, with 69 branches and 207 ATMs, has become one of the largest foreign banks in the Egyptian market, with 185 billion Egyptian pounds ($10bn) in assets as of March 31, FAB said in a statement on Monday.

The merger will enable FAB to “further extend our operations’ footprint in Egypt — one of the most promising strategic markets in the region”, Hana Al Rostamani, group chief executive at FAB, said.

“This investment highlights our firm confidence in the Egyptian economy, in line with government initiatives to foster the investment climate across all sectors. FAB believes that Egypt is a strategic gateway to Mena; hence, this step will undoubtedly contribute to our strong position regionally and globally.”

The combined entity is expected to complete systems integration by the end of this year, allowing customers to conduct transactions through FABMISR branches, the bank said on Monday.

Last April, FAB announced receiving approval from regulators to transfer the shares after it agreed to buy the Egyptian arm of Lebanon-based Bank Audi in January 2021 for an undisclosed sum.

FAB had initially started talks in 2020 to acquire Bank Audi’s assets in Egypt but later suspended discussions because of the outbreak of the coronavirus pandemic.

The acquisition is part of FAB’s regional expansion plans. The lender, which opened a representative office in Iraq in March, withdrew its non-binding offer to acquire a majority stake in Egypt's largest investment bank, EFG Hermes.

FAB cited “continuing global market uncertainty and volatile macroeconomic conditions” as reasons for dropping the bid, it said at the time.

“As the largest bank in the UAE, FAB continues to implement its ambitious growth strategy through focused acquisition activities,” Karim Karoui, FAB’s group head of mergers and acquisitions and chairman of FABMISR, said.

FAB more than doubled its first-quarter net income to a record high, driven by the sale of its majority stake in its payments business and improved performance of the bank’s core business.

Net profit attributable to shareholders for the three months to the end of March surged to Dh5.1bn ($1.4bn), the lender said in April.