First Abu Dhabi Bank (FAB) plans to raise up to Dh15 billion through a rights issue as the UAE’s largest lender positions itself to capitalise on growing demand for financing linked to trade, infrastructure, artificial intelligence and cross-border investment.
The proposed capital raise, approved by the bank’s board and subject to shareholder and regulatory approvals, comes as UAE lenders seek to benefit from strong economic growth, rising capital inflows and expanding international business ties. FAB said the additional capital would support growth in its domestic market and across its international network, which spans more than 20 markets and 25 UAE-linked trade corridors.
The Abu Dhabi-based lender intends to issue 1.11 billion new shares at Dh13.52 each, representing a 30 per cent discount to its closing share price on November 10. The transaction is expected to raise Dh15 billion in gross proceeds and could be completed in the first quarter of 2027.
The move follows a period of rapid expansion for FAB. Since 2020, the bank’s total assets have risen by more than 50 per cent to Dh1.4 trillion, while net profit has doubled to Dh21.1 billion. Over the 2020-2025 period, it returned Dh44 billion in cash dividends to shareholders.
FAB said the fresh capital would help it deepen client relationships, expand lending and continue investing in strategic areas such as technology and artificial intelligence.
The bank is targeting annual loan growth and revenue growth of between 10 per cent and 15 per cent through 2031, while aiming to maintain a return on tangible equity above 17 per cent and distribute more than Dh50 billion in cumulative dividends over the period.
“The UAE continues to advance an ambitious long-term economic agenda, underpinned by diversification, investment, innovation and a growing role in global trade and capital flows,” said Sheikh Tahnoon Bin Zayed Al Nahyan, chairman of FAB. “FAB is at the centre of this growth, enabling strategic investment across the UAE and internationally.”
Group chief executive Hana Al Rostamani said the rights issue would help the lender “capture significant opportunities across the UAE and our established international network”. She added: “The strength of our home market, combined with the reach and connectivity of our international network, gives us a strong platform for growth.”
FAB’s largest shareholder, Mubadala Investment Company, which owns 37.9 per cent of the bank, has indicated it intends to subscribe for its full pro-rata entitlement, signalling confidence in the lender’s long-term growth strategy.
The bank will seek shareholder approval for the proposal at a general assembly meeting scheduled for December 7.
Source: Khaleej Times