Al Salam gets go-ahead for BMI merger
Manama, October 9, 2013
Al Salam Bank-Bahrain, one of the kingdom's pioneering Islamic banks, said its shareholders have approved the merger of the bank with BMI Bank through exchange of shares.
Upon merger, the group will have total assets of around BD1.8 billion ($4.7 billion), financing facility of circa BD1.2 billion, equity of more than BD285 million and customer deposits in excess of BD1.2 billion, Al Salam chairperson Shaikha Hessa bint Khalifa Al Khalifa said yesterday.
Shareholders of Al Salam Bank have also approved a plan to raise the bank's capital by BD100 million by issuing new shares as part of the merger plan, reported the Gulf Daily News, our sister publication.
At an extraordinary general assembly, Al Salam shareholders approved the board of directors' recommendation by an overwhelming majority.
In a speech to the shareholders, Shaikha Hessa said Al Salam's strategy is to grow organically and through mergers and acquisitions.
"In keeping with this strategy, the board of directors had been continuously on the lookout for suitable commercial banking targets to acquire and integrate to position the bank as the largest domestic Islamic bank in Bahrain," she said.
"In this regard, the board and senior management had been in discussions with BMI Bank for over a year before the transaction was put forward to the shareholders for their approval."
Shaikha Hessa affirmed that the directors saw this as an excellent opportunity to grow the total assets, shareholders equity and customer deposits, all of which were extremely important financial indicators for financial institutions.
Apart from size of the balance sheet, the merger is expected to result in sustainability to the group's earnings she stated.
Shaikha Hessa added that the transaction was in line with the Central Bank of Bahrain's stated strategy to consolidate the banking sector so stronger players emerge to promote healthy competition in the banking sector.-TradeArabia News Service