Emirates NBD (ENBD.DU): Press report suggests talks to acquire HSBC’s Turkey unit

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Emirates NBD (ENBD.DU): Press report suggests talks to acquire HSBC’s Turkey unit

Goldman Sachs Emirates NBD (ENBD.DU)

highly centered on capturing organic and inorganic expansion opportunities in key

international markets, which explicitly include Türkiye, Saudi Arabia, Egypt, and

India.

n Track Record of M&A: The group has demonstrated a willingness to undertake

large-scale acquisitions, as evidenced by its agreement to acquire a majority stake in

RBL Bank in India through a primary infusion of USD 3bn.

n Consolidating Turkish Scale: Any acquisition of HSBC Turkey’s premium retail base

or wholesale connections would allow Emirates NBD to further scale up its already

sizable Turkish operations via DenizBank, capturing more trade and customer flows.

n Regulatory and Macroeconomic Hurdles: Any transaction would require the

acquiring entity to navigate Türkiye’s highly volatile macroeconomic conditions and

frequent regulatory changes, which Emirates NBD’s management noted can change

very often.

Valuation and risks

Emirates NBD is the second-largest bank in the UAE, with sizable market share across

both the retail and corporate segments in the country. With ENBD trading at 1.3x 2026E

P/TB on our estimates, a c.10% premium to its 5Y history, we see limited re-rating

potential and believe the stock looks fairly priced at current valuations; this is in the

context of our expectation for the bank to generate c.16% ROTE sustainably. Over the

near to medium term, we think investor focus will be on the impact of lower rates on

NIMs, the size of the uptick in cost of risk given the impact from Denizbank, and the

potential impact on returns from the integration of the RBL Bank acquisition and the

consequent impact on capital and returns.