Shares of National Bank of Abu Dhabi and FGB rose on Wednesday after the final annual general assembly meetings of both lenders ahead of their merger next month.
FGB, which was the biggest index mover, rallied after its dividend distribution plan was given the green light.
During its meeting, NBAD doubled its medium-term euro note programme to €15 billion, giving the lender further scope for borrowing money if necessary.
FGB shares rose by 1.8 per cent to Dh13.9. The bank’s board had proposed a cash dividend of Dh1 per share for 2016, the same for last year. Yesterday’s closing price implies a dividend yield of 7.2 per cent.
Shares of NBAD advanced by 1.4 per cent to Dh10.65. NBAD’s move to double the size of its medium-term note comes at a time when many UAE banks are going to the debt market more often, as liquidity in the banking system has not been as abundant as it was in the years when oil prices were high.
NBAD and FGB will officially merge on April 1 and shares of the new entity will begin trading in Abu Dhabi the next day. The merger, which was approved by both banks’ shareholders on December 7, was done in part to cut down on costs by removing duplicate posts and sharing resources.
mkassem@thenational.ae
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