Emirate NBDEmirate NBD

Emirates NBDEmirates NBD

- C- bank financial strength rating (BFSR), which maps to a Baseline Credit Assessment (BCA) of Baa2; on review for possible downgrade.

- A1 long-term local and foreign currency deposit ratings; on review for possible downgrade.

- Prime-1 short-term local and foreign currency deposit ratings; not on review.

The ratings assigned to Emirates NBDEmirates NBD are on par with the existing ratings on EBI and NBD.

The new entity, Emirates NBDEmirates NBD, will assume legal responsibility for all debt issued and guaranteed by EBI and NBD. Therefore, Moody's existing ratings on Commercial Paper, local and foreign currency senior and subordinated debt, as well as on Emirates Islamic Bank Sukuk Certificates guaranteed by EBI will eventually be transferred to Emirates NBDEmirates NBD (Please see below for a list of the debt ratings).

Emirates NBDEmirates NBD has been incorporated in the UAE for the purpose of the merger and has been issued a banking license. The merger of EBI and NBD was approved by the extraordinary shareholders' meetings of EBI and NBD on 5 and 6 September 2007, respectively. As of 16 October 2007, the shares of EBI and NBD listed on the Dubai Financial Market ("DFM") were replaced by the shares of Emirates NBDEmirates NBD.

Moody's understands that, under the terms of the merger, all assets and liabilities of EBI and NBD are now assumed by Emirates NBDEmirates NBD as a legal successor. According to the legal documentation received from Emirates NBDEmirates NBD, the legal succession date was 5 November 2009, signifying the date the merger was published in the commercial register (as per Article 280 of the UAE Companies Law). Following a three-month period during which creditors have the right to object to the merger, the legal succession will become effective. Emirates NBDEmirates NBD has chosen 21 November 2009 as the date on which all banking operations of EBI and NBD are transferred to a new core banking system, while all branches of EBI and NBD will gradually be rebranded as Emirates NBDEmirates NBD.

Since October 2007, EBI and NBD have stopped reporting their individual financial statements and the new entity Emirates NBDEmirates NBD (listed on the DFM) has been publishing consolidated results. Consequently, the ratings of EBI and NBD have been identically assigned to represent the merged entity until the legal merger was completed. As a result, the ratings and outlook of Emirates NBDEmirates NBD are equivalent to those currently assigned to EBI and NBD.

Although Moody's does not expect creditors to object to the merger, the rating agency will maintain the BFSR, deposit and debt ratings on both EBI and NBD until the completion of the three-month statutory period.

The last rating action on Emirates Bank International and National Bank of Dubai was implemented on 10 August 2009, when Moody's placed all long-term ratings on review for possible downgrade. Specifically, the following ratings were placed on review:

Emirates Bank International PJSC (EBI):

- C- BFSR (which maps to a Baseline Credit Assessment (BCA) of Baa2)

- A1 long-term local and foreign currency deposit ratings

- A1 senior debt rating

- A2 subordinated debt rating

- Emirates Islamic Bank Sukuk Certificates of A1, guaranteed by EBI

National Bank of Dubai (NBD):

- C- BFSR (mapping to a BCA of Baa2)

- A1 long-term local and foreign currency deposit ratings

- A1 senior debt rating

- A2 subordinated debt rating

The review is expected to be completed before year-end 2009.

The principal methodologies used in rating the banks were "Bank Financial Strength Ratings: Global Methodology" (February 2007) and "Incorporation of Joint-Default Analysis into Moody's Bank Ratings: A Refined Methodology" (March 2007), which can be found at www.moodys.com in the Rating Methodologies sub-directory under the Research & Ratings tab.

Other methodologies and factors that may have been considered in the process of rating this issuer can also be found in the Rating Methodologies sub-directory on Moody's website.

Emirates NBDEmirates NBD, the merged company of EBI and NBD, is headquartered in Dubai and reported AED291 billion (US$79.2 billion) total assets as of 30 September 2009.

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Mardig Haladjian
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John Tofarides
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