IPIC pays off loan that purchased bank stake
The International Petroleum Investment Co,. the Abu Dhabi tate owned fund, had paid in full a USD2 billion loan its unit had taken out last 2011. The loan was done to finance a stake purchase in Malaysian bank RHB Capital. This was confirmed by several banking sources aware of the said transaction.
The financing for the acquisition was provided by the seller of the stake, the Abu Dhabi Commercial Bank. The said sale was seen as a means to strengthen its capital base for the financial institution at the said time.
IPIC's majority owner is Aabar Investments. The firm agreed to pay MYR10.80 per share for the 25% in RHB Capital for the shares owned by ADCB. The total price is USD1.9 billion for the stake purchased. While this effectively halted the full consolidation of the Malaysian banking sector, the former owner ADCB earned USD357 million profit from the said sale.
According to ADCB in the statement, "This has a negligible impact on our profitability but significantly reduces our concentration exposure. In the absence of this repayment, the bank's loan book grew by UAD4.8 billion in the nine month period."