Dubai: First Abu Dhabi Bank, whose shares have been one of the best performers in the UAE, said it has received regulatory approvals from the central bank and the markets regulator to raise its Foreign Ownership Limit (FOL), triggering further bullishness in the stock.
The FOL limit will be raised to 40 per cent from the earlier 25 per cent, the bank said in a statement posted on Abu Dhabi Securities Exchange’s website.
“This is definitely a good step forward to see a higher FOL as it allows for less restrictions promoting market equality and generally is inviting for foreign investors,” Issam Kassabieh, senior financial analyst at Menacorp told Gulf News.
FAB shareholders had approved the increase in FOL at the general assembly meeting in February, and traders had been buying the stock in anticipation of the move.
“This is also an opportunity to increase the size of blocks traded on the stock and a chance for the stock get more competitive with peers who have yet to incresde their FOL and have struggled in getting foreign interest as a result of the restrictions,” Kassabieh said.
Ahead of the announcement, FAB shares closed lower at Dh14.84 in a weak Abu Dhabi market. FAB shares have gained 26 per cent in the past one year, outperforming the Abu Dhabi index, which has gained 14 per cent. The best performing bank has been Abu Dhabi Commercial Bank with 40 per cent gains in the same time period.