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NCB Capital to see long-term benefits after NCB, Samba tie-up – Moody’s

NCB Capital to see long-term benefits after NCB, Samba tie-up – Moody’s
Moody’s forecasted the merged entity to have a combined market share of around 35%-40%.
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Riyadh – Mubasher: Moody’s Investors Service expected the completion of the merger between the National Commercial Bank (NCB) and Samba Financial Group to be relatively smooth despite the ongoing circumstances.

The NCB-Samba merger is set to achieve long-term benefits for NCB's asset management arm, NCB Capital Company, including some product diversification into fixed income and alternative products, the US rating agency said in a report.

Moreover, Moody’s forecasted the merged entity to have a combined market share of around 35%-40%, projecting the company to reach new customer and business-partner base.

In October 2020, NCB entered into a legally binding merger agreement with Samba to take the necessary steps to implement a merger. The completed transaction involves a merger by NCB to Samba.

Under the deal, shareholders of Samba will receive 0.739 new NCB shares in exchange for every share they hold in Samba.

In addition, the merger will strengthen the position of the merged entity as Saudi Arabia's biggest asset manager, based on assets under management (AUM), Moody’s said.

By the end of last September, NCB Capital had a 31% market share in Saudi Arabia, making it the largest player, while Samba Capital had a 4% share, securing the sixth position.

The NCB-Samba tie-up will create a regional powerhouse with SAR 837 billion ($223 billion) in assets, uniquely positioned to accelerate the transformation of Saudi Arabia’s banking landscape and deliver progress towards Vision 2030.