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Emirates NBD sells its stake in Bank of Beirut

The offices of the Beirut stock exchange, Tuesday, March 4, 2014. (The Daily Star/Hasan Shaaban)

BEIRUT: Emirates National Bank of Dubai exited the Lebanese market after selling its stake in Bank of Beirut for $29.275 million.

Neither Bank of Beirut nor Emirate National Bank of Dubai made announcement about the acquisition but Beirut Stock Exchange reported a block trading of BOB for 2,09,133 shares with a value of $29.275 million.

These were the total shares owned by Emirates National Bank of Dubai in BOB before it decided to sell its stake.

Sources told The Daily Star that BOB has agreed to buy Emirate National Bank of Dubai after careful study by the Central Bank.

Emirates National Bank of Dubai owned 7.56 percent of Bank of Beirut and is considered the fourth largest shareholder of the Lebanese lender.

Surprisingly, Emirates National Bank of Dubai sold its stake to Bank of Beirut for $14 per share, far lower than the list price of $25.5.

A banker interpreted this as an attempt by the UAE bank to sell its share at any cost.

Some news media wondered if this move by the UAE bank was a form of pressure on Lebanon to pressure Hezbollah to end its involvement in Syria and Yemen.

A banker stressed that shareholders in Bank of Beirut should be pleased by the return on their investment in this lender.

“Bank of Beirut is one of the most profitable banks in Lebanon and the shareholders are getting a good return on their investment,” the banker said.

He added that Bank of Beirut will not be affected by the exit of the UAE bank because it has bought back the stake at a lower price.

Bank of Beirut recorded a net profit of $151.98 million in the third quarter of 2017 while total assets stood at $17.47 billion.

The bank is one of the five leading Lebanese banks in terms of profits, customer deposits and assets.

The bank is one of the six lenders listed on the Beirut Stock Exchange.

Arab Gulf investors have other shares in some of the large Lebanese banks.

 
A version of this article appeared in the print edition of The Daily Star on December 15, 2017, on page 4.

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