• Home
• Financial Services
• News Article

IPOs to bring investments

By Shamsa al Riyamiya

MSM open to foreign funds
MUSCAT -- Financial experts have lauded the policy of subscription at Muscat Securities Market (MSM), saying that the money market's openness to foreign investors and its approach on allowing foreigners to subscribe to public shares encourages the flow of investments and increases liquidity. Brokerage companies experts and executives pointed out that, for example, the 11-time coverage of Bank Nizwa initial public offering, being the first Islamic bank in the Sultanate, came after a long absence of IPOs.

Moreover, the experts said, allowing foreigners to subscribe did not affect small investors in any negative way, but, on the contrary, it helped increase liquidity and the follow of funds from abroad, constituting a boost to the Omani economy and enhancing the bank's position. Loay Batayna, Oman Arab Bank's Deputy Director-General for Investment and Development, said, "MSM is an open money market that welcomes investments from various nationalities.

The administration of MSM and the Capital Market Authority has been supporting and organising investments at MSM. Due to the large volume of subscription to Bank Nizwa's shares, the decision to welcome public offering was recommended by the director of issue and approved by the bank's foundation committee.
Allowing non-Omanis to subscribe to Bank Nizwa shares was a source of vigour." Batayna hailed the move as a healthy approach in the Omani economy, saying that we cannot talk about attracting Arab and foreign investments on one hand and close offers of investment like these on the other hand.

Mustafa Ahmed Salman, Executive President of United Securities Company, said since the mid-1990, MSM has adopted an open approach to investments and allowed direct ownership in MSM-listed companies.
Business analyst Ahmed bin Said Kashoob said that open subscription to Bank Nizwa shares gave wide scope for all to invest and enhanced the bank's position, being the first Islamic bank in the Sultanate. This, he added, is significant, given the shaky international economic situation and the weakness of performance of GCC money markets, as well as recent reluctance to invest in Muscat Securities Market.

Investment Management Group of Oman Arab Bank SAOC (OAB), Lead Issue Manager and Lead Underwriting Arranger for Bank Nizwa IPO, recently released the eagerly-awaited subscription figures for the Bank Nizwa IPO surpassing investment community guesses. The initial compilation of figures of all four collecting banks show over 11.3 times subscription i.e over RO 681 million (subject to reconciliation) collected against an offer of RO 60 million through 37,084 applications.

Lo'ai B Bataineh Head of OAB's Management Group of Oman Arab Bank SAOC said that this sets the stage for the first Islamic Bank of the Sultanate to make a flying start and Oman Arab Bank is proud to be part of this.
We are happy that our efforts for a broad base participation have borne fruits. This makes the Muscat Securities Market very newsworthy across the region and worldwide. Recently IPOs in the region have been few and far between and MSM now appears a very active market considering the subscription levels for Bank Nizwa. This also bodes well for the capital market in general and investment community in particular".

© Oman Daily Observer 2012

---

© Copyright Zawya. All Rights Reserved.

---