Abu Dhabi Commercial Bank on Wednesday formally merged with Union National Bank, and the combined entity acquired Al Hilal Bank as its Sharia-compliant lending unit. This creates one of the biggest retail-banking powerhouses in the UAE. The enlarged ADCB Group with Dh423 billion in assets, is now the third-largest financial institution in the country, serving more than a million customers, ADCB said in a statement to the Abu Dhabi Securities Exchange on Wednesday. The new bank accounts for about 21 per cent of the country’s total loan market as of end of 2018 data, it added. The group, with 60.2 per cent ownership by the Government of Abu Dhabi through the Abu Dhabi Investment Council, also started trading on Abu Dhabi bourse under the ticker of ADCB. UNB has been dissolved as a legal entity and its shares are delisted, ADCB said. Al Hilal Bank, under the terms of the merger, retains its existing identity and continues to operate as a separate Islamic bank within the broader group, focusing on retail banking services. “In today’s financial industry, scale is vital for us to operate successfully and achieve our goal of sustainable, long-term growth,” Ala’a Eraiqat, ADCB Group chief executive said. “This merger creates a resilient banking group with the capacity to provide excellent service for our customers in our core market, the UAE.” The transaction is an important step in the transformation of the UAE’s economy, he said. By bringing the three lenders under one umbrella, the new ADCB is well placed to make greater contribution to the UAE’s economic development. Banks in the Arabian Gulf region are increasingly looking to merge to gain scale and better face the tougher operating conditions. The ADCB deal follows the 2017 union of National Bank of Abu Dhabi and First Gulf Bank, which created the UAE's biggest banking entity, First Abu Dhabi Bank. Dubai Islamic Bank, the country's top Sharia-compliant lender is the latest in the UAE to announce its intentions to tie-up with rival Noor Bank. Elsewhere in the region, Saudi Arabia's National Commercial Bank is pursuing its merger with Riyad Bank. _____________ _____________ Post merger, ADCB Group is led by a management team that has a “clear direction for the bank and will lead us towards our goal of long-term, sustainable growth”, Eissa Al Suwaidi, bank’s chairman said in a letter to the staff. “This is the beginning of a new chapter in our shared story.” Planning for the integration of the three banks is progressing well, which will be carried out in phases from the second half of the year. The integration of the systems and processes will largely take place behind the scenes, with minimal disruption to customer service, ADCB said. The ADCB brand will gradually replace the UNB brand and customers will have access to a range of products and services.