First Abu Dhabi Bank (FAB), the largest lender in the UAE, is reportedly exploring potential acquisition targets in Turkey, with Yapi Ve Kredi Bankasi, the country’s seventh-largest lender by assets, being a focal point of interest. This strategic move aligns with FAB’s aspirations for overseas growth opportunities.
According to Bloomberg, sources familiar with the matter revealed that FAB has initiated preliminary discussions with the owners of various Turkish banks, with Yapi Kredi being a prime candidate. The Turkish bank, part of Koc Holding, is currently valued at $7.6 billion. The surge in interest from UAE banks to acquire Turkish assets follows Turkish President Recep Tayyip Erdogan’s visits to Gulf countries in 2023, during which the UAE pledged significant financial support to Turkey.
Dubai Islamic Bank (DIB), the largest Sharia-compliant bank in the UAE, previously acquired a 20 per cent stake in Turkey’s TOM Group of Companies in September 2023, further emphasizing the growing interest of UAE financial institutions in the Turkish market.
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Shares of Yapi Kredi Bank surged nearly 6.0 per cent following Bloomberg’s report, indicating investor optimism about potential acquisition talks. However, Koc Holding stated that there were no developments requiring public disclosure at the moment.
Daniel Takieddine, CEO Mena at BDSwiss, commented on FAB’s strategic move, highlighting its potential to strengthen economic ties between the UAE and Turkey. He emphasized that FAB’s interest in the Turkish market underscores the UAE’s commitment to diversifying its economic engagements globally and expanding its financial influence.
FAB’s exploration of overseas expansion opportunities mirrors similar moves by its GCC counterparts. Notably, Emirates NBD acquired Turkey’s Denizbank in 2019, demonstrating the trend of Gulf banks venturing into the Turkish banking sector.
FAB’s previous attempts at international expansion include an offer to acquire a majority stake in Egypt’s EFG Hermes in February 2022, which was later withdrawn due to market uncertainties. Additionally, FAB completed the merger of Bank Audi Egypt with its Egyptian operations in June 2022, solidifying its presence in one of the Arab world’s largest economies.
If FAB proceeds with the acquisition of Yapi Kredi Bankasi or other Turkish assets, it could herald a transformative period for the Turkish banking sector and further enhance the UAE’s prominence in international investment markets.
