Tamkeen -Shamil partnership fuels SME growth

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MANAMA, BAHRAIN - A landmark initiative by TamkeenTamkeen (Labour Fund) and Shamil BankShamil Bank, a leading Bahrain-based Islamic commercial and investment bank and a wholly-owned subsidiary of Ithmaar Bank, has provided more than BD9.3 million in financing to 192 small and medium enterprises (SMEs) in Bahrain.

The financing, which contributed directly to growth in the Kingdom's private tourism, retail, construction, manufacturing, education and transportation industries, was made as part of the BD12.5 million Nibrass scheme, a unique joint initiative between TamkeenTamkeen (Labour Fund) and Shamil BankShamil Bank.

The Nibrass scheme provides financing with the lowest profit rates ever made available to Bahrain's SMEs by the banks. The three-year scheme was introduced last year to support the growth and expansion plans of Bahrain's SMEs by providing them financing packages of between BD10,000 and BD100,000. Recipients are given up to 10 years to repay the financing which is offered at at a record low profit rate of 4 per cent per annum (on reducing balance) by Shamil BankShamil Bank that is subsidised by TamkeenTamkeen.

"We are delighted with the success of the Nibrass financing scheme which has provided a much needed boost to members of our local business community looking to enter new territories and expand their product offering," said TamkeenTamkeen's Senior Manager for Private Sector Support, Mohammed Bucheery. "It is particularly rewarding to see almost 200 Bahraini enterprises capitalising on this unique, unprecedented opportunity," he said.

"Actively supporting the development of SMEs is a vital part of TamkeenTamkeen's ongoing efforts to revitalise the Kingdom's labour market and make Bahraini companies an 'employer of choice'," said Bucheery. "Through our strategic partnership with one of Bahrain's leading Islamic banks, Shamil BankShamil Bank, we were able to successfully design an effective financing model for others to follow and this model has directly impacted the economy by increasing opportunities for investment and employment," he said.

Shamil BankShamil Bank Assistant General Manager, Corporate Banking Farooq Al Awadi pointed to the Scheme's success as an example of the powerful synergies that can be created through partnerships and said he was pleased the Bank could contribute to the Kingdom's socio-economic development.

"Shamil BankShamil Bank is committed to supporting projects that add long-term value to the community and can deliver tangible, positive benefits to the Kingdom and its people," said AlAwadi. "Partnering with TamkeenTamkeen to launch the Nibrass financing scheme was a perfect fit for us and is in line with our strategic objective to invest in Bahrain's economic growth," he said.

"Against the backdrop of the ongoing volatility in the markets, economies are demanding new and improved models for growth," said AlAwadi. "The injection of BD9.3 million of financing - with another BD3.2 million in the pipeline - into the market will stimulate the local economy and cause a positive ripple effect resulting in greater employment and investment," he said.

TamkeenTamkeen is an independent, semi- autonomous authority tasked with reforming Bahrain's labour market and enhancing the Kingdom's overall prosperity by investing in Bahraini employability, job creation and social support.

SMEs from multiple sectors - including construction, manufacturing, wholesale and retail trade, maintenance, hotels, restaurants, transportation, storage, communications and education - have, so far, benefited from the Nibrass scheme.

Mohammed Osama, who runs Paragon Trading, said the Scheme allowed him to significantly expand his business.

"Thanks to the Nibrass scheme, we have been able to improve our market share in ways we simply could not have considered otherwise," said Osama. "We were, for example, able to import more goods and equipment and, in doing so, we were able to improve both our quality and overall production. As a result, we have since increased our human resource investments, expanded structurally and diversified our product range. These improvements have translated to an almost 20 percent increase in turnover over the past year," he said.

Meanwhile, Isa Qambar, who runs AlFursan Plastic Factory, used the Nibrass finance package to cut back his company's operating costs and has reinvested the subsequent savings into further expanding his business.

""After we received the Nibrass scheme, we have been able to enjoy cost savings of almost 50 per cent," said Qambar. "I have been able to introduce a unique product to the market and have moved into the forefront of the plastic industry in Bahrain. The loan has helped immensely in purchasing new machinery and increasing my product offering," he said.

For more information on the 'Nibrass' scheme or to apply for a finance SMEs can contact Shamil BankShamil Bank directly on 00973 13 30 3030 or visit Shamil BankShamil Bank's headquarters in the Seef Tower, Seef District.

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TamkeenTamkeen (Labour Fund)
The Kingdom of Bahrain has taken vital steps towards a labour market reform which is an essential stride to ensure that the human capital of the country is developed and that employment is made more attractive for localisation as well as to improve performances of businesses. The strive towards labour reform will impact the Kingdom's economy and raise standards of living as well as pose a challenging commitment to the improvement of services in Bahrain.

TamkeenTamkeen (Labour Fund) is a semi-autonomous yet independent authority which formulates strategic and operational plans to use the fees collected by the LMRA in order to enhance the overall prosperity of Bahrain by investing in Bahraini employability, job creation, and social support. Hence, the TamkeenTamkeen (Labour Fund)'s main objectives are to support Bahrainis to become the employees of choice, and (ii) to support high quality private sector job creation and helping the private sector cope with the impact of labour market reform.

To achieve these objectives, TamkeenTamkeen (Labour Fund) will invest in the cost and quality competitiveness of Bahrainis (e.g., reduction of cost of employing Bahrainis relative to expatriates, investment in skill and work ethic development programs of Bahrainis) and tackle employment barriers on both employer and labour market entrants sides through a combination of financial incentives and capability building, and (ii) in supporting the private sector's adjustment to new cost structures by providing access to capital to alleviate short-term cash constraints or improve productivity, and in know-how initiatives that support improvements in productivity and decreased reliance on expatriate labour through spreading management and technical knowledge.

About ShamilShamil Bank
Shamil BankShamil Bank is a Bahrain-based Islamic retail bank licensed and regulated by the Central Bank of Bahrain, with commercial and investment banking activities. It has grown steadily to become one of Bahrain's leading financial institutions.

Shamil BankShamil Bank provides a diverse range of products and services that cater to the financing and investment needs of individuals and institutions. Conducting its business in compliance with the principles of Sharia'a, it operates a network of local branches and maintains a presence in overseas markets through its subsidiaries, associated and affiliated companies.

Shamil BankShamil Bank is a wholly owned subsidiary of Ithmaar Bank B.S.C., a full service investment bank.

For more information please contact:
Marketing Communications Department
TamkeenTamkeen (Labour Fund)
Kingdom of Bahrain
Tel: 17383335/17383327
Fax: 17382352
Email: info@tamkeen.bh
Website : www.tamkeen.bh

Taimour Raouf
Director, Group Public Relations
Ithmaar Banking Group
Tel: +973 39616434

© Press Release 2008