Abu Dhabi Commercial Bank is all set to divest its 24.9 per cent stakes in the Malaysia-based RHB Capital according to a MoU signed on 17 June, 2011. The stake sale will significantly boost capital of the bank and it is expected to receive about AED 7.0 billion ($1.9 billion) in cash from this sale.

Meanwhile, leading rating agency S&P raised 'long- and short-term ratings on the bank to 'A/A-1' from 'A-/A-2. Bank’s stand-alone credit profile (SACP) now stands at 'bbb' against 'bbb-' earlier. The bank has said in a statement that it would use the proceeds for strengthening its balance sheet and for enhancing its hold on the local market.

Strengthening of capitalization of the bank, according to the rating agency, would improve estimated risk-adjusted capital (RAC) ratio for ADCB. RAC is expected to raise to 9 per cent compared to the current level of 7 per cent.

ADCB's creditworthiness is expected to remain resilient over the medium term due to comfortable liquidity conditions. S&P said that bank would continue to strengthen its financial profile but ADCB's asset quality continues to depend on the future performance of restructured debt.