Ithmaar Bank offers a variety of Sharia-compliant products and services in Bahrain besides having a global footprint
Headquarters of Ithmaar Bank in Manama, Bahrain. (Credit: Ithmaarbank/Wikipedia.org)
Bank of Bahrain and Kuwait (BBK) has launched initial talks with Ithmaar for a possible acquisition of the Bahrain operations of the latter’s subsidiary Ithmaar Bank, an Islamic retail bank.
According to the parties, they are still in the preliminary discussions stage and a possible transaction will be subject to the completion of due diligence by both of them.
The planned transaction will be further subject to approvals from shareholders and regulatory authorities for its closing.
Ithmaar Bank is said to have the largest Islamic retail banking network in Bahrain. It offers a variety of Sharia-compliant products and services for catering to the financing and investment requirements of individuals and institutions.
The Islamic retail bank also has a footprint in overseas markets via its subsidiary, Faysal Bank Limited (Pakistan).
For the six-month period ended 30 June 2020, the bank reported BHD93.25m ($247.4m) in total income.
On the other hand, Bank of Bahrain and Kuwait is among the major commercial banks in Bahrain.
Bank of Bahrain and Kuwait is also looking to acquire certain assets of Ithmaar’s other fully-owned subsidiary IB Capital, as part of the proposed deal.
Ithmaar chairman Amr Al Faisal said: “This transaction is in line with Ithmaar Holding’s strategy of creating value for its shareholders, and we look forward to exploring this possible opportunity further.”
The transaction, if executed, is expected to considerably grow Bank of Bahrain and Kuwait’s operations in Bahrain besides adding a turn-key, full-service Islamic banking solution to its portfolio.
Furthermore, the proposed acquisition will strengthen the well-established brand and position of Ithmaar Bank and position it to better capitalise on growth opportunities.
Bank of Bahrain and Kuwait chairman comments on the possible acquisition of Ithmaar Bank
Bank of Bahrain and Kuwait chairman Murad Ali Murad said: “BBK has long played a key leadership role in the Kingdom of Bahrain’s banking and financial services industry.
“To maintain this leadership role, and as part of its ongoing business expansion strategy, BBK has been exploring opportunities to expand its activities and diversify its offerings, particularly in Sharia-compliant banking businesses. Ithmaar Bank seems a natural fit, and we look forward to exploring this possible acquisition further.”