Abu Dhabi Commercial Bank (ADCB) will start talks to sell its RHB stake to Abu Dhabi investment fund Aabar and has won Malaysian central bank approval for the move, it on Sunday.

ADCB's plans to sell its 25 percent stake in RHB -- valued at around $1.6 billion -- appeared to hit a hurdle after two local peers, Maybank and CIMB, got regulatory approval to bid for RHB last month.

Sources told Reuters last week that the Abu Dhabi lender's planned auction would proceed. "In connection with the bank's strategic review of its stake in RHB Capital ... the bank received approval from Bank Negra (the Malaysian central bank) to enter into negotiations with Aabar Investments regarding a potential sale transaction," ADCB said in a statement on Sunday.

Aabar is majority owned by Abu Dhabi government investment vehicle International Petroleum Investment Corp (IPIC).   

Shares in ADCB, which is 55-percent owned by the government of Abu Dhabi, were down 0.32 percent on the Abu Dhabi bourse on Sunday.   

ADCB had hired Goldman Sachs and BOA-Merrill Lynch as advisors on the transaction to sell its position in Malaysia's fifth-largest bank with a $7.3 billion market value. - Reuters