Almoayyed, centre, with NBB board members
NBB plans to acquire Bahrain Islamic Bank
Manama, March 7, 2013
The National Bank of Bahrain (NBB) is likely to acquire the loss-making Bahrain Islamic Bank (BisB) and give itself an Islamic finance arm, said a top official.
"We are in talks with BisB and we expect to make an announcement early next week," said NBB’s chairman Farouk Almoayyed in an interview with our sister publication the Gulf Daily News (GDN) on the sidelines of his bank's annual meeting yesterday.
"We are in talks with BisB and we expect to make an announcement early next week," said chairman Farouk Almoayyed in an interview with our sister publication the Gulf Daily News (GDN) on the sidelines of his bank's annual meeting yesterday.
"We see this as a business opportunity as we do not have an Islamic banking operation and under our management we believe it will do well."
Last year, BisB, the first Islamic bank in Bahrain, posted a net loss of BD36 million ($94.95 million) compared with a net loss of BD17 million for 2011.
But this was after increasing its provisions portfolio by BD41 million.
NBB however is looking strong and is keen to move into the Islamic market.
Almoayyed said the year had started well for the bank and was meeting the ambitious budget targets it has set itself.
"Last year was another successful year for the bank with a net profit of BD47.50 million, an increase of 4.1 per cent over 2011," he told shareholders at the meeting at the bank's headquarters yesterday.
"Strong growth in revenue and careful expense management resulted in an operating profit before provisions of BD 59.27 million for last year, an increase of 11.2 per cent over the previous year.
"These results are a testimony to the resilience of the bank's business model which focuses on strong domestic growth while selectively seeking new business opportunities in the region.
"Return on equity at 16 per cent and return on assets at 1.88 per cent remains strong by regional and international standards. The bank remains well capitalised with strong liquidity and a well diversified asset portfolio," Almoayyed said.
"We are optimistic about the growth prospects that will positively impact the financial services industry," added chief executive Abdul Razak Al Qassim.
"NBB's strategic plan and balance sheet is well positioned to capitalise on these opportunities to achieve stronger growth in the coming years.
"We will leverage on the largest network of branches, ATMs and other delivery channels in Bahrain to sell our products and services to our valued customers both in the retail and corporate segments." – TradeArabia News Service