A Bank must demonstrate to the satisfaction of the Central Bank that the proposed Major Acquisition would not expose the Bank to undue (prudential and/or consumer protection) risks, hinder effective supervision, or the implementation of corrective measures in the future, including an orderly resolution of the bank, and that the Bank has adequate financial, managerial and organizational resources for the transaction.
When the proposed Major Acquisition is to be undertaken by a subsidiary or affiliate of the Bank, the Bank must demonstrate to the satisfaction of the Central Bank that it has the ability to manage any risks arising from the proposed Major Acquisition and that it would not expose the Bank to undue risk, hinder effective supervision, or the implementation of corrective measures in the future, including an orderly resolution of the Bank.
The Central Bank will consider each application on its own merits, applying the criteria set out in the Regulation
When the proposed Major Acquisition is outside the U.A.E., the Central Bank requires more enhanced due diligence to be undertaken by the Bank which includes detailing of the political, economic and legal risks of the overseas jurisdiction in question, including country regulations and related authorities’ reputation. Due diligence should also cover market environment with respect to macroeconomic development, and the subsequent impacts it may have, as per Articles 2(2) and 3(1) of this Regulation.
The Central Bank will also consider whether the authorities in the host country perform supervision effectively and whether the Central Bank will be able to exercise supervision on a consolidated basis. The Central Bank may not approve a transaction if bank secrecy or other laws, or any other factors, would impair effective consolidated supervision.