Bahrain's BisB sets up committee to evaluate NBB takeover offer

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MANAMA: Bahrain Islamic Bank (BisB) has set up an independent committee of its board of directors to evaluate a voluntary takeover offer by National Bank of Bahrain (NBB).

In a filing to Bahrain Bourse (BHB), BisB said while it had not yet received a formal offer from NBB, a three-member committee including Mohammed Nooruddin, Khalid AlJassim and Marwan Tabbara has been established.

This comes nearly a year after NBB first announced it was considering buying shares in Bahrain’s largest Sharia-compliant lender.

The conventional bank also announced in a filing to BHB on Sunday that it is still conducting a financial and legal due diligence process on BisB aimed at confirming last year’s financial and legal diligence exercises on the voluntary takeover.

The process may or may not result in a formal offer, it added.

NBB is the second largest Bahraini bank by market capitalisation, according to Reuters data.

BisB is the eighth largest by market capitalisation, the data shows.

In a bourse filing last August, NBB had said it was in talks to buy Islamic Development Bank (IDB)’s entire stake in BisB.

As per BHB records, IDB, a Jeddah-based multilateral development bank, owns 14.4 per cent shareholding in BisB.

The deal would have increased NBB’s stake in the Islamic lender from 29.1pc to 43.5pc.

NBB had announced that it had signed a letter of intent with IDB for exploration of the potential acquisition terms and pricing.

It said a transaction adviser was appointed to assist with preliminary investigations and due diligence, declining to disclose any names or an expected timeline for the deal.

In 2013, NBB and SIO Asset Management Company, the investment arm of the Social Insurance Organisation, together bought 51.6pc stake in BisB from its Kuwaiti owners.

They each took a 25.8pc stake in a deal valued at about BD34.9 million.

In July, NBB reported net profit of BD40m for the six months ended June 2019, an increase of 8.7pc compared with BD36.8m for the prior year period.

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