By Gavin Gibbon
BBK is exploring the possibility of acquiring the Bahrain operations of Ithmaar Bank
Bank of Bahrain and Kuwait (BBK), one of the largest commercial banks in the kingdom, has entered into initial talks with Ithmaar Holding to acquire the Bahrain operations of Ithmaar Bank.
The bank operates the largest Islamic retail banking network in Bahrain. The acquisition also includes specific assets of IB Capital, a wholly-owned subsidiary of Ithmaar Holding.
The plans, which are subject to shareholder and regulatory approvals, are still in the preliminary discussions phase and subject to the completion of due diligence by both parties.
“BBK has long played a key leadership role in the Kingdom of Bahrain’s banking and financial services industry,” said BBK chairman Murad Ali Murad. “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.”
Earlier this week Ithmaar Holding revealed a 43 percent decrease in net profit for the first six months of the year, which was blamed on the economic impact of the global Covid-19 pandemic. The investment firm saw its H1 profits drop from $13.02 million in 2019 to $7.40m this year.
“Ithmaar Bank, an Islamic retail bank, played a pioneering role in the establishment and subsequent development of Islamic banking in the region,” said Ithmaar Holding chairman, Prince Amr Al Faisal. “A wholly-owned subsidiary of Ithmaar Holding, Ithmaar Bank is a growing, resilient bank that continues to invest in the future and plays a key role in the community. 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.”