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Sunday, 18 December 2011

Emirates NBD Price Estimate Cut 20% at HC on Loans, Possible Amlak Deal - Bloomberg

Emirates NBD PJSC (EMIRATES), the United Arab Emirates’ biggest bank by assets, had its price estimate cut 20 percent at HC Brokerage, citing rising loan-loss charges and a possible acquisition of mortgage lender Amlak Finance PJSC.

“We think an Emirates NBD acquisition of Amlak has become more likely and believe Emirates NBD may also have to absorb some of the refinancing needs of government owned entities in 2012, particularly if European and U.S. banks reduce their exposure to the region,” analysts Jaap Meijer and Kareem Ghaly wrote in a note dated today.

The shares of Amlak Finance, an Islamic mortgage company part-owned by Emaar Properties PJSC (EMAAR), were suspended in November 2008 after the global credit crisis blocked their access to borrowings. A government committee studying an overhaul of Amlak “continues to explore the possibilities of a balance-sheet restructuring,” the company said in November.