NBB plans to buy BisB stake

MANAMA: National Bank of Bahrain (NBB) has revived interest in acquiring shares in Bahrain Islamic Bank (BisB), both banks said in separate disclosures to Bahrain Bourse (BHB) yesterday.

The conventional lender is “considering making a voluntary takeover offer for issued shares of BisB”, it said, without specifying whether NBB would be buying a stake or make a complete acquisition of BisB.

This comes more than eight months after NBB first announced it was considering buying shares in Bahrain’s largest Sharia-compliant lender.

NBB is the second largest Bahraini bank by market capitalisation, according to Reuters data.

BisB is the eighth largest by market capitalisation, the data shows.

NBB said yesterday it has started a “financial and legal due diligence process aimed at confirming last year’s financial and legal diligence exercises”.

The process may or may not result in a formal offer, it added.

In a bourse filing last August, NBB had said it was in talks to buy Islamic Development Bank’s entire stake in BisB.

As per BHB records, IDB, a Jeddah-based multilateral development bank, owns 14.4 per cent shareholding in BisB. The deal would have increased NBB’s stake in the Islamic lender from 29.1pc to 43.5pc.

NBB has said then that it had signed a letter of intent with IDB for exploration of the potential acquisition terms and pricing.

It said a transaction adviser was appointed to assist with preliminary investigations and due diligence, declining to disclose any names or an expected timeline for the deal.

In 2013, NBB and SIO Asset Management Company, the investment arm of the Social Insurance Organisation, together bought 51.6pc stake in BisB from its Kuwaiti owners.

They each took a 25.8pc stake in a deal valued at about BD34.9 million.

Last week, NBB reported net profit of BD40m for the six months ended June 2019, an increase of 8.7pc compared with BD36.8m for the prior year period.

Source: http://www.gdnonline.com/Details/570497