Saudi Arabia’s Alawwal Bank and the Saudi British Bank (SABB) are on track for a merger to take place in the first half of 2019, according to Alawwal managing director Soren Nikolajsen.
In October, the two banks announced that their respective boards had approved plans for the merger, which will create the kingdom’s third largest bank overall.
In an interview with Arabian Business in Dubai, Nikolajsen said that the two banks are approaching the phase of the merger in which they go through regulatory approvals and hold an extraordinary general meeting (EGM) for shareholders to approve.
“We expect to complete [the merger],” he said. “We expect that the day in which that the two become [legally] one bank should happen in the first half of the year.”
Once completed, Nikolajsen added, Alawwal customers will benefit from “a bigger and better bank.”
“We aim to create the best bank in the kingdom across the whole range of customer segments,” he said. “Both banks today are reasonably similar. They are traditional corporate banks, and the majority of the balance has been focused on the corporate size [but] both are making an effort to increase their retail banking.”
The combined bank will be the second largest corporate bank in the kingdom based on combined assets.
Additionally, Nikolajsen said that he believes the new bank will help Saudi Arabia complete the privatisation and reform goals it has set out in Saudi Vision 2030.
“When you look at what it takes from a bank’s perspective to finance things in the private sector, and project finance and privatisations, you need scale and capacity,” he said. “It is fully in tune with the transformation changes that are happening in the kingdom.”
In October, the two banks said that no involuntary staff redundancies are expected as a result of the merger, and that there would be no immediate change for customers of both banks as they will remain independent and continue to operate a business as usual service until the merger is completed.For all the latest banking and finance news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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