National Bank of Abu Dhabi to get $2bn loan next month, say sources

National Bank of Abu Dhabi (NBAD) aims to complete a planned $2bn loan to refinance existing bilateral debt and provide new funding by the second week of December, banking sources told Reuters on Monday.

Last month NBAD said raising the money would help consolidate its banking relationships ahead of its planned merger with First Gulf Bank, which will create one of the largest banks by assets in the Middle East and Africa when it is completed in the first quarter of 2017.

The term loan, with a lifespan of three years, will require participating lenders to each pledge $200m in return for a fee of 30 basis points, the sources said.

The interest rate on offer for the banks which lend the money is 65 basis points over the London interbank offered rate (Libor), NBAD said at the end of October, noting it had invited banks with which it had an existing relationship, as well as a select group of other international lenders.

NBAD did not immediately respond to a request by Reuters for comment.