The NBB said in a statement that the consideration of the offer is either in cash of $0.31 per share or through a share-swap deal with a share exchange ratio of 0.167 NBB shares per Bahrain Islamic Bank shares.

The offer is subject to a minimum acquisition of 40.94 percent, which would take NBB’s total stake in Bahrain Islamic Bank up to 70 percent.

The deal to buy Bahrain Islamic Bank is expected to cost NBB around $329 million.

In the statement, NBB also said, “Bahrain Islamic Bank shareholders are notified that NBB is a conventional retail financial institution and as such the new shares in NBB offered as an alternative to the cash offer are not a Shariah-compliant investment.”

Currently, NBB, which is the second-largest bank in Bahrain with a market share of 27.94 percent, is the second-largest shareholder with a 29.06 percent stake in Bahrain Islamic Bank. While the Saudi Arabia-based Islamic Development Bank owns a 14.42 percent stake in Bahrain Islamic Bank, the General Council of Kuwaiti Awqaf holds a 7.18 percent stake.

NBB, which was also the first indigenous bank of Bahrain, first expressed interest in Bahrain Islamic Bank back in October 2018. Earlier in July this year, the bank again announced that it had re-initiated talks with the Islamic lender.

During the same period, NBB chief executive Jean-Christophe Durand revealed the bank’s plan to increase the number of branches in the UAE and Saudi Arabia and is looking to double the size of its debt capital market and advisory business to $10 billion.

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The group’s CEO Shayne Nelson said that the bank’s balance sheet shows continuous improvement in liquidity and the common equity Tier 1 ratio and stable credit quality. The total income for the first six months of the year reached Dh9.52 billion. The figure is an increase of 13 percent compared with the bank’s Dh8.45 billion income last year. 

Media reports said that Emirates NBD’s net profit results also comprise a gain from a disposal of stake in Network International for Dh2.1 billion. The bank’s core operating profit rose 8 percent year-on-year owing to robust asset growth and a higher fee income. The total interest income rose by 10 percent compared to the previous year, while total non-interest income increased 20 percent because of strong foreign exchange growth and investment banking income.

Its impaired loan ratio remained at 5.9 percent during the first half of the year, local media reported.  Hesham Abdullah Al Qassim, Vice-Chairman and Managing Director, said, “The group continues to make progress on international growth. Emirates NBD is honoured to have been given permission to open 20 more branches in Saudi Arabia. The bank has opened additional branches in Egypt and all regulatory approvals for the group’s acquisition in Turkey have been granted.”

Earlier this month, Turkey’s competition authority granted approval for the bank to take over 11 subsidiaries of Denizbank. Denizbank is Turkey’s fifth-largest bank in terms of assets. 

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