Bank controlled by Abu Dhabi’s ruling family wants a foothold in SA
A sovereign wealth fund chaired by Manchester City’s owner holds nearly 40% of First Abu Dhabi Bank
10 July 2023 - 19:06
UPDATED 11 July 2023 - 08:11
byKabelo Khumalo
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Sheikh Mansour bin Zayed Al Nahyan. Picture: Twitter/HHMANSOOR
Abu Dhabi sovereign wealth fund Mubadala, headed by United Arab Emirates (UAE) deputy president Sheikh Mansour bin Zayed Al Nahyan, plans to have a banking presence in SA through its financial services behemoth, First Abu Dhabi Bank (FAB).
Mansour, who owns English football club Manchester City, is a member of the emirate’s ruling Al Nahyan family. His brother, Sheikh Mohamed bin Zayed Al Nahyan, is the president of the UAE and ruler of Abu Dhabi. Mansour also serves as chair of the UAE central bank.
Mubadala, which has $276bn (R5.1-trillion) in assets under management, owns 37.9% of FAB and the Abu Dhabi ruling family has a 15.8% stake in the lender. FAB is listed on the Abu Dhabi Stock Exchange and is valued at about $51bn, making it one of the largest constituents on the exchange.
Its market capitalisation is bigger than that of FirstRand, Nedbank, Standard Bank and Absa combined.
According to the S&P Global Market Intelligence’s world top 100 largest banks 2023 report, FAB has $302bn in assets.
FAB’s intentions to operate in SA were revealed in a trademark dispute between it and the country’s biggest bank by market capitalisation, FirstRand, reported on by Business Day on Monday.
FirstRand tried in vain to oppose FAB’s trademark application, arguing it resembles that of its subsidiary, FNB.
The court papers show that FAB, chaired by another high-profile Al Nahyan family member, Sheikh Tahnoon Bin Zayed, in 2017 submitted two trademark registration applications at the registrar of trademarks.
The trademarks FAB is seeking are for companies that offer fund investment, internet banking services, mobile banking services, banking, business banking information, financial liquidation services and capital investment services, among others.
FAB was created from a 2017 merger between First Gulf Bank and National Bank of Abu Dhabi, becoming the largest bank in the UAE. The lender’s latest results show that 39% of its income comes from investment banking, 25% from corporate and investment banking and 12% from consumer banking. In Africa, FAB has a presence in Egypt — where it has 69 branches and 211 ATMs — and Libya.
Licence
A foreign entity that wishes to establish a branch in SA must comply with certain requirements, including having net assets of at least $1bn. However, FAB has not made an application for a banking licence, according to the Reserve Bank.
FAB did not respond to questions on its intentions for wanting to conduct business in SA.
FAB has shown an appetite for expanding internationally and recently showed interest in acquiring British multinational bank Standard Chartered. Bloomberg reported in February that FAB was considering making an all-cash offer of between $30bn and $35bn for Standard Chartered.
The group in May appointed SA-born banker Lars Kramer as CFO, responsible for overseeing all financial activities, including “groupwide finance, treasury, investor relations and strategy”.
Kramer, who was educated at the University of Cape Town, joined FAB from the Netherlands-based ABN Amro, where he has been finance director since June 2021. He was previously CFO at Hellenic Bank and spent the bulk of his career with ING.
The Gulf region has experienced an economic boom fuelled by higher oil prices in the wake of Russia’s war on Ukraine, with sovereign wealth funds and banks on the hunt for deals amid a weakened global outlook.
The UAE president caused a stir in April when he and an entourage of 500 people arrived at the Bulembu Airport in the Eastern Cape for a private visit. The family owns a game reserve in the province.
Eastern Cape
The wealthy ruler reportedly built a R20m runway with his own money to accommodate his private jet and cargo planes at the airport, which was decommissioned for passenger travel decades ago.
A month before the family’s arrival, Eastern Cape premier Oscar Mabuyane visited the UAE where he met Mubadala and Abu Dhabi National Oil Company to explore trade and investment opportunities.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
Bank controlled by Abu Dhabi’s ruling family wants a foothold in SA
A sovereign wealth fund chaired by Manchester City’s owner holds nearly 40% of First Abu Dhabi Bank
Abu Dhabi sovereign wealth fund Mubadala, headed by United Arab Emirates (UAE) deputy president Sheikh Mansour bin Zayed Al Nahyan, plans to have a banking presence in SA through its financial services behemoth, First Abu Dhabi Bank (FAB).
Mansour, who owns English football club Manchester City, is a member of the emirate’s ruling Al Nahyan family. His brother, Sheikh Mohamed bin Zayed Al Nahyan, is the president of the UAE and ruler of Abu Dhabi. Mansour also serves as chair of the UAE central bank.
Mubadala, which has $276bn (R5.1-trillion) in assets under management, owns 37.9% of FAB and the Abu Dhabi ruling family has a 15.8% stake in the lender. FAB is listed on the Abu Dhabi Stock Exchange and is valued at about $51bn, making it one of the largest constituents on the exchange.
Its market capitalisation is bigger than that of FirstRand, Nedbank, Standard Bank and Absa combined.
According to the S&P Global Market Intelligence’s world top 100 largest banks 2023 report, FAB has $302bn in assets.
FAB’s intentions to operate in SA were revealed in a trademark dispute between it and the country’s biggest bank by market capitalisation, FirstRand, reported on by Business Day on Monday.
FirstRand tried in vain to oppose FAB’s trademark application, arguing it resembles that of its subsidiary, FNB.
The court papers show that FAB, chaired by another high-profile Al Nahyan family member, Sheikh Tahnoon Bin Zayed, in 2017 submitted two trademark registration applications at the registrar of trademarks.
The trademarks FAB is seeking are for companies that offer fund investment, internet banking services, mobile banking services, banking, business banking information, financial liquidation services and capital investment services, among others.
FAB was created from a 2017 merger between First Gulf Bank and National Bank of Abu Dhabi, becoming the largest bank in the UAE. The lender’s latest results show that 39% of its income comes from investment banking, 25% from corporate and investment banking and 12% from consumer banking. In Africa, FAB has a presence in Egypt — where it has 69 branches and 211 ATMs — and Libya.
Licence
A foreign entity that wishes to establish a branch in SA must comply with certain requirements, including having net assets of at least $1bn. However, FAB has not made an application for a banking licence, according to the Reserve Bank.
FAB did not respond to questions on its intentions for wanting to conduct business in SA.
FAB has shown an appetite for expanding internationally and recently showed interest in acquiring British multinational bank Standard Chartered. Bloomberg reported in February that FAB was considering making an all-cash offer of between $30bn and $35bn for Standard Chartered.
The group in May appointed SA-born banker Lars Kramer as CFO, responsible for overseeing all financial activities, including “groupwide finance, treasury, investor relations and strategy”.
Kramer, who was educated at the University of Cape Town, joined FAB from the Netherlands-based ABN Amro, where he has been finance director since June 2021. He was previously CFO at Hellenic Bank and spent the bulk of his career with ING.
The Gulf region has experienced an economic boom fuelled by higher oil prices in the wake of Russia’s war on Ukraine, with sovereign wealth funds and banks on the hunt for deals amid a weakened global outlook.
The UAE president caused a stir in April when he and an entourage of 500 people arrived at the Bulembu Airport in the Eastern Cape for a private visit. The family owns a game reserve in the province.
Eastern Cape
The wealthy ruler reportedly built a R20m runway with his own money to accommodate his private jet and cargo planes at the airport, which was decommissioned for passenger travel decades ago.
A month before the family’s arrival, Eastern Cape premier Oscar Mabuyane visited the UAE where he met Mubadala and Abu Dhabi National Oil Company to explore trade and investment opportunities.
khumalok@businesslive.co.za
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