Manama, Kingdom of Bahrain –13 November 2016

Eskan Bank announced today that it has finalised the formal registration of its groundbreaking real estate investment trust (REIT) with the Central Bank of Bahrain (CBB), which marks completion of all CBB-related regulatory requirements. This will now enable the REIT to be launched to Bahraini and GCC institutional and retail investors on Tuesday 22 November, with a subsequent listing on the Bahrain Bourse (BHB). Securities & Investment Company (SICO) is the mandated Lead Manager for the public offering and listing of Bahrain’s first Sharia-compliant real estate investment trust (REIT) that is open to retail investors, as well as the sub-investment manager and dedicated market maker.

Welcoming this latest development, Dr. Khalid Abdulla, General Manager of Eskan Bank, said: “Following full regulatory compliance with the CBB, we are now proceeding with plans for the public offering of the REIT, which will open for subscriptions on Tuesday 22 November. In readiness for this landmark event, we have appointed Bahrain Islamic Bank (BisB) as the official receiving bank for the subscription offering. The REIT has a target distributable yield of 6.5 per cent net of all costs, and a minimum subscription of BD 500, which should make it accessible and attractive to individual Bahraini and GCC nationals seeking a safe investment opportunity in the Kingdom’s real estate sector,” he added.

According to SICO’s Chief Executive Officer Ms. Najla Al Shirawi: “The Eskan Bank REIT incorporates several unique features, designed to enhance its attractiveness and provide safeguards for investors. These include an efficient structure with one of the lowest expense ratios; no real estate development risk as found with most other REITs; and no debt, which is rare in real estate investment structures. The two income-generating properties that comprise the REIT – Segaya Plaza and Danaat Al Madina – currently have an overall occupancy rate exceeding 85 per cent. This is expected to increase in the near future, given that the commercial assets of the Danaat Al Madina property were only handed over last year.”

Eskan Bank’s Chief Business Officer & Deputy General Manager, Mr. Ahmad Tayara, re-affirmed the bank’s intention to expand and diversify the REIT in the future. “We will augment the existing seed assets by inviting private and public sector developers to include their properties in the Eskan Bank Realty Income Trust, subject to meeting the REIT’s strict criteria for acquiring assets and compliance with regulatory requirements. This will provide an improved yield for investors as well as improving the risk profile of the REIT over time.”

Mr. Wissam Haddad, Head of Corporate Finance at SICO, pointed out: “Eskan Bank’s REIT has an annual target distribution yield of 6.5 per cent, payable twice a year, while still being able to allocate sufficient cash reserves annually to ensure the properties remain in prime position for decades ahead.  This distributable yield is especially attractive given the modernity of the properties; the liquidity provided on the Bahrain Bourse with a dedicated market maker; the diversity of the property types and tenant base; as well as no short-cuts being taken with regards to the appointment of professional management.  In comparison, US equity REITs have an average yield of 3.7 per cent (even with 30 per cent of average debt on their properties); while local equities are currently distributing an average annual yield of 4.4 per cent.”

The Eskan Bank Realty Income Trust will open for subscriptions on Tuesday 22 November for a two-week period only, with the closing date being Tuesday 6 December .  Further information can be found on www.eskanREIT.com.

- Ends -

For more information, please contact:
Nadeen Oweis
Head of Corporate Communications 
Securities & Investment Company (SICO(
Tel : 00973 39016469
Email : Nadeen.oweis@sicobahrain.com

Securities & Investment Company (SICO) 
Headquartered in the Kingdom of Bahrain, and with a growing regional presence and international footprint, Securities & Investment Company (SICO) is one of the premier wholesale banks in the GCC region. SICO provides a select range of investment banking solutions – brokerage, market making, treasury, asset management, corporate finance, and custody and fund administration – which are underpinned by an independent, value-added research capability.

Established in 1995, and listed on the Bahrain Bourse in 2003 as a closed company, SICO operates under a conventional wholesale banking licence from the Central Bank of Bahrain. The Bank has two wholly-owned subsidiaries: SICO Fund Services Company (SFS) – a specialised regional custody house; and SICO UAE – an Abu Dhabi-based brokerage firm licensed by the Emirates Securities & Commodities Agency.

The Bank’s strong shareholding base consists of pre-eminent regional financial institutions – Arab Banking Corporation, Ahli United Bank, BBK, Gulf Investment Corporation, Arab Investment Resources Company and National Bank of Bahrain – together with the Social Insurance Organisation of the Kingdom of Bahrain, and the Bank’s staff through the SICO Employee Stock Ownership Plan.

© Press Release 2016