Abu Dhabi's First Gulf Bank has severed ties with its Libyan unit after political unrest in the country and its investment has been classified as "available for sale," a filing from the lender showed. FGB, majority owned by Abu Dhabi's ruling family, has suspended its management agreement with former subsidiary, First Gulf Libya Bank, adding the investment had a net carrying value of 396 million dirhams ($107.8 million). "FGB has no involvement in the day-to-day operations of FGLB and FGLB is no longer classified as a subsidiary of FGB," it said in a prospectus filed to the London Stock Exchange and dated July 11. "FGB's investment in FGLB is now classified as an available for sale investment." FGB shares were down 1.67 per cent on the Abu Dhabi exchange at 0945 GMT. Available for sale is an accounting measure that allows FGB to assign a fair value to the unit on its books, instead of an impairment, and the bank said the unit was not currently on the auction block. "The subsidiary is not for sale at the current time and FGB isnot talking with any parties in this regard," the lender told Reuters in a statement on Tuesday. Several companies have halted projects in Libya due to violent unrest in the North African country where impatience is growing about the stalemate between rebels and Muammar Gaddafi's government. Developer Al Maabar, part owned by Abu Dhabi state investment vehicle Mubadala and Aldar Properties (ALDR.AD), has put its $300 million project in Libya on hold, it said in April. The Abu Dhabi lender, second largest in the United Arab Emirates by market value, said all FGB-nominated members in the Libyan entity had resigned. Earlier on Tuesday, FGB set up a new $3.5 billion Islamic bond programme, eyeing its first sukuk sale.
