Emirates NBD eyes RBS stake in Saudi affiliate

Sun 25 May, 2008 09:22

By Ola Galal

DUBAI (Reuters) - Emirates NBD , the Gulf's largest lender, said it was interested in buying Royal Bank of Scotland's (RBS.L) (RBS) stake in Saudi Hollandi Bank to tap retail business in the world's largest oil exporter.

"We are interested in the stake," Dubai-based Emirates NBD Chief Executive Officer Rick Pudner told Reuters on Sunday. "It's obviously an interesting possibility to expand in the kingdom."

RBS owns 40 percent of Saudi Hollandi, a stake worth about $1.72 billion (868 million pounds). Pudner said there were no talks taking place.

"In terms of retail franchise, it's an exciting market because of the wealth and the number of people," Pudner said.

London-based Middle East Economic Digest (MEED) said on Friday the United Arab Emirates lender was interested in buying the stake in Saudi Hollandi to expand in the largest Arab economy.

RBS took control of the Saudi Hollandi stake when it bought Dutch bank ABN Amro last year, saying in its offer letter that it would sell the Saudi assets.

National Bank of Kuwait and Standard Chartered Plc (STAN.L) were competing for the stake, the Kuwaiti lender's Chief Executive Officer Ibrahim Dabdoub told Reuters in 2006. Lebanon's Banque Audi was a third contender, sources familiar with the matter told Reuters last year.

MEED reported in March that Standard Chartered was still interested in the Saudi Hollandi stake after it failed to secure its own banking licence.

Shares of Saudi Hollandi are down 2.8 percent this year to Saturday's close, outperforming the benchmark , which is down more than 12 percent.

(Editing by Tomasz Janowski)