First Abu Dhabi Bank eyes Turkish expansion with Yapi Kredi

First Abu Dhabi Bank joins the fray as the newest UAE bank showing interest in Türkiye’s lucrative market, following Dubai Islamic Bank’s announcement of a 20% stake acquisition in the TOM Group

First Abu Dhabi Bank PJSC is examining potential acquisition targets in Türkiye, including Yapi Kredi Bank, as part of the Emirati lender’s quest for growth opportunities overseas.

FAB, the UAE’s largest lender, has held early exploratory talks with the owners of several Turkish banks. It has been evaluating the possibility of acquiring Yapi Kredi, which is currently valued at ₺241.6 billion ($7.6 billion).

Sources familiar with the matter said deliberations are still at a preliminary stage, and there is no certainty that FAB will pursue a deal. Representatives for FAB, Yapi Kredi, and Koc Holding, the majority owner of the Turkish lender, declined to comment.

Yapi Kredi, Türkiye’s seventh-largest lender by assets, is part of Koc Holding, the country’s largest business and industrial group. Shares of Yapi Kredi surged 9.4% to reach their highest level on record.

Meanwhile, Koc’s stock initially soared as much as 8% before settling at a 4.4% increase at 10:17 a.m. in Istanbul.

President Erdogan’s Gulf visit boost interest in Turkish banks 

President Recep Tayyip Erdogan conducted a series of visits to Gulf countries in June. Following these visits, there was a surge in interest from UAE banks to Turkish banks.

FAB joins other UAE lenders expressing interest in Turkish assets after Erdogan’s visit to the Gulf region in July aimed at bolstering investments in Türkiye’s $1.1 trillion economy.

Dubai Islamic Bank, the UAE’s largest Sharia-compliant lender by assets, announced in September its plans to acquire a 20% stake in Türkiye’s TOM Group of Companies.

During Erdogan’s visit last year, the UAE pledged over $50 billion to support Türkiye after years of political differences.

Gulf banks consider Türkiye a potential market for growth due to its geographical proximity, familiarity with the banking system, and population exceeding 85 million. In the UAE, 54 banks serve a population of 9.5 million.

Dubai-based Emirates NBD acquired Denizbank for $2.8 billion in 2019. Saudi and Kuwaiti banks have had a presence in Türkiye for a long time.

Saudi Arabia’s largest bank, National Commercial Bank, bought Türkiye’s Türkiye Finans Katılım Bankası for $1.08 billion in 2007.

Kuwait Finance House established Kuveyt Türk Katılım Bankası in Türkiye in 1989, owning it entirely.

Source: Newsroom