Riyadh — Saudi Arabia’s Alawwal Bank and the Saudi British Bank (SABB) are to complete consolidation in the first half of 2019, Alawwal’s managing director said.
The two lenders are pushing ahead with closing the merger deal, then an extraordinary general meeting (EGM) for shareholders will be held for approval, Soren Nikolajsen told Arabian Business. “We expect that the day in which that the two become one bank should happen in the first half of the year,” Nikolajsen said.
In October, SABB, an affiliate of HSBC Holdings, and Alawwal bank have signed a binding merger agreement to create Saudi Arabia’s third-biggest lender with a market capitalisation of about $17.2 billion.Once consummated, Alawwal customers will benefit from “a bigger and better bank”, Nikolajsen said, adding, “We aim to create the best bank in the kingdom across the whole range of customer segments.
”The combined lender will be the second largest corporate bank in the oil-rich kingdom based on combined assets, Arabian Business said.The new entity will help Saudi Arabia accomplish the privatisation and reform goals of the Saudi Vision 2030, which aims to diversify the economy and wean the GCC off petrodollars, the managing director noted.
“When you look at what it takes from a bank’s perspective to finance things in the private sector, and project finance and privatisations, you need scale and capacity..It is fully in tune with the transformation changes that are happening in the kingdom,” he said.
On the other hand, National Commercial Bank (NCB), Saudi Arabia’s biggest lender, and Riyad Bank announced in December the beginning of negotiating a potential merger that may be implemented over the coming period.
The assets of the new entity established by the unity of Riyad Bank NCB will hit SAR 685.05 billion ($182.68 billion), according to Mubasher’s statistics.
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