Khaleeji Commercial Bank successfully finalizes issuance of Sukuk worth USD 159 Million

Algosaibi:

• The successful closure of these Sukuk reflects the Bank’s sound financial and investment approach in selecting the best solutions to support its capital and business development
• Supporting the capital will have a vast positive impact on strengthening our financial position and support the Bank’s financing activity
• The proactive procedures taken by Team Bahrain have sustained the stability of the Kingdom's economy and reflected positively on safeguarding the banking sector from the repercussions of the pandemic
• Local banks have sufficient liquidity that enable them to stably sustain their operation

Manama, Kingdom of Bahrain: Khaleeji Commercial Bank “KHCB”, one of the leading Islamic Banks in the Kingdom of Bahrain, has recently announced that it has successfully finalized issuance of Sukuk worth USD 159 Million fully covered by GFH Financial Group as the sole subscriber. This issuance proceeded after the approval of regulatory authorities and the Extraordinary General Assembly earlier this year, as Shareholders had initially supported the Bank to issue Sukuk as Additional Tier 1 (“AT1”) Capital worth up to USD 200 Million, with the aim of reinforcing the capital base and contributing to the achievement of intermediate objectives within the Bank’s new strategy.

On this occasion, KHCB CEO Mr. Sattam Sulaiman Algosaibi stated: "The successful closing of the AT1 reflects the Bank's well-thought-out financial and investment approach in opting for the best solutions to support the capital and develop the business towards achieving important intermediate objectives within our new strategy, as we are keen to deploy the improved capital base in further enhancing the quality of assets and developing banking services provided to individuals, SMEs, and corporates."

Mr. Algosaibi continued: "Supporting the Bank’s capital will have a great impact on strengthening our financial position and enabling us to enter new strategic partnerships and promising projects that would establish a foundation for us to achieve growth through reducing the cost of financing and strengthening capital adequacy, in addition to investing in the development of eBanking Systems and the quality of services provided to our valued clients."

Stable Situation

Meanwhile, Mr. Algosaibi praised the proactive measures taken by the Kingdom of Bahrain's government, led by His Majesty King Hamad bin Isa Al Khalifa, and supported by His Royal Highness Prince Khalifa bin Salman Al Khalifa, the Prime Minister, and followed up by His Royal Highness Prince Salman bin Hamad Al Khalifa, the Crown Prince, Deputy Supreme Commander and First Deputy Prime Minister, to safeguard the banking and financial sector from the negative impact that accompanied the outbreak of the Coronavirus “COVID-19” pandemic.

Mr. Algosaibi added: "The measures and decisions taken by Team Bahrain, in addition to the banking sector's laws and regulations, have maintained strong liquidity and a robust capital base at the banks in the Kingdom, creating a positive impact on the continuation of development projects and curtailing the repercussions of the global crisis caused by the emergence of the COVID-19 pandemic on the economy. Additionally, the decisions made by the Central Bank of Bahrain (CBB) have contributed to protecting the banking sector from these impacts and encouraged banks to implement the necessary steps to fortify their financial positions and support its clients on a wider scale."

Mr. Algosaibi further said: "At a time where we are witnessing several sectors across the globe experiencing a downturn, the Kingdom of Bahrain reported noticeable stability thanks to the precautionary measures taken by the Kingdom of Bahrain, particularly in the banking sector which is taking steady strides to this day, owing to the clear future vision of the Wise Leadership. The first and second stimulus packages have sustained the steady growth of the Kingdom's economy, consequently reinforcing the stability of the banking sector. The patronage provided by the Wise Leadership to the sector has made it one of the stable pillars of the Kingdom’s economy, as it contributes 16.7% of the GDP today."

Mr. Algosaibi noted the laws and regulations set by the CBB throughout the previous years that are now a strong foundation for the banking sector to defy the challenges created by the pandemic. He pointed out that "Today, the significance of all the laws and regulations set by the CBB in the new millennium up until now have been acknowledged by all, thanks to which financial institutions in the Kingdom are steadily progressing despite the new challenges.

Completion of Plans to Digitize Services

Through the enhancement of its capital, KHCB seeks to push the wheel of development to complete its plans to digitize infrastructure with the goal of investing in current and future opportunities. KHCB was one of the first banks in the Kingdom to adopt the digital approach and put financial technology at the center of its plans to move towards the future. In this regard, KHCB launched several digital services, including open banking services, which made it one of the first financial institutions to initiate this step.

Mr. Algosaibi indicated that "the current situation has created new opportunities, and the increase in capital will give us the advantage to be proactive in investing in these opportunities, including finding alternative ways to continue providing financial services. Moreover, the Bank was one of the first to adopt these methods through our initiative to launch many programs and digital products that facilitate our valued clients’ access to our innovative banking services."

Comprehensive Development

Additionally, Mr. Algosaibi affirmed that KHCB will continue its endeavors to provide support for the efforts of the wise Government to achieve the comprehensive development of the Kingdom through investment in vital projects, in addition to doubling the efforts to support the distinguished services provided by the wise Government to preserve the welfare of the Bahraini community. This includes providing special offers for citizens benefiting from the social housing program "Mazaya" in cooperation with the Ministry of Housing.

KHCB is a leading Islamic bank that strives to achieve clients' aspirations through an Islamic banking model that offers a comprehensive range of high quality Shari'a-complaint banking services and investment opportunities to individuals and companies.

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© Press Release 2020