Islamic banking major Dubai Islamic Bank (DIB) is all set to acquire UAE-based Noor Bank for an undisclosed price to create a leading Shari’a banking group with combined assets of around AED275bn (£59.04bn).
Established in 2008, Noor Bank, which formerly operated as Noor Islamic Bank, is a full-service Shari’a-compliant bank. Headquartered in Dubai, the bank provides corporate and personal banking, Takaful (Islamic insurance), wealth management, treasury and trading among other products and services.
Apart from Dubai, the bank has multiple locations across Abu Dhabi, Sharjah and Al Ain. As of 2018, Noor Bank was the 11th largest bank in the UAE based on asset size.
Noor Bank’s existing owners are the Dubai government, the ruling family members of Dubai, and a select group of the Dubai government-nominated UAE nationals, owning a combined stake of 88.3%. The remaining stake is owned by a member of Abu Dhabi ruling family, the UAE government through Emirates Investment Authority (EIA), and an employee stock ownership trust.
DIB said that the acquisition will improve its influence and increase its market share, while enhancing operational efficiencies. Furthermore, the new size and scale following the acquisition, is expected to enable DIB to connect the dots from Far East, East Africa and the sub-continent, with Dubai as the hub.
DIB GCEO Adnan Chilwan said: “The acquisition of Noor Bank is in line with our disciplined yet flexible growth strategy which strikes the perfect balance between market dynamics and shareholder interest.
“We have always been open to both organic and inorganic growth as long as profitability and returns are protected and this transaction is no different. The economics of the deal will allow us the opportunity to capitalize on synergies, notably cost efficiencies, digitization, product and business development and most importantly the customer experience.”
DIB’s board of directors has recommended the bank’s shareholders to vote in favour of the transaction after getting all required regulatory approvals and meeting other conditions.
DIB chairman Mohammed Al Shaibani said: “Innovation and service excellence sit at the very heart of our business and this will continue as we build scale through this acquisition and develop fresh new ways to improve the banking experience for our customers.
“In addition, this announcement will provide opportunities for economic growth and prosperity across the region, ensuring that the UAE’s financial sector remains at the forefront of the Islamic economy.”
Upon completion of the deal, Noor Bank’s operations will be integrated and consolidated within DIB.