UAE's Largest Bank First Abu Dhabi Plans $4.1 Billion Rights Issue Backed by Sovereign Fund Mubadala for Postwar Growth

First Abu Dhabi Bank (FAB), the United Arab Emirates' largest lender, has announced plans to raise 15 billion dirhams ($4.1 billion) through a rights issue to fund its "next phase of growth." The bank told analysts it sees higher organic growth opportunities rather than acquisitions ahead, positioning itself for a postwar investment boom in the country.

Abu Dhabi sovereign wealth fund Mubadala, which owns a nearly 40% stake in FAB, is backing the deal. This follows other banks in the emirate raising money through equity sales, including Abu Dhabi Commercial Bank's 6 billion dirham raise last year and Abu Dhabi Islamic Bank's ongoing 1.75 billion dirham offering.

Banks in the region have been tapping equity markets more frequently as loans grow faster than new deposits. They also face higher provisioning and impairments due to war-related risks. FAB's strategic pivot signals a preference for strengthening the balance sheet to support domestic demand over external mergers and acquisitions.