Bahrain’s Ithmaar Bank has signed a five-year $167m Islamic loan facility with
Ahli United Bank, it said on Monday, marking its
return to the credit markets since the financial crisis.
Hit by a 2008 regional real estate crash and a freeze in
financing, Ithmaar had suffered heavy losses in 2009.
In October 2009 the company said it planned to raise between
$400m to $500m to repair its balance sheet, through
a rights issue and by placing a convertible Islamic bond.
The lender coughed up $103m in a rights issue in
March but did not place the sukuk, as the Bahraini investment
sector has been shut out from credit markets since the real
estate crush effectively ended its business model of raising
money for property and private equity projects.
The bank has since converted itself into a retail lender by
swallowing its fully-unit retail unit Shamil, allowing it to
edge back to profitability in 2010 while its peers in the sector
continue to make losses.
Ithmaar did not disclose the interest rate of the murabaha
loan from Ahli United, Bahrain’s largest bank.
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