BMI Bank receives shareholder approval for merger with Al Salam Bank - IFN

BMI Bank receives shareholder approval for merger with Al Salam Bank

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BAHRAIN: As a desired result of an extraordinary general meeting (EGM), Shariah compliant BMI Bank (BMI) has successfully obtained the necessary approvals for a proposed merger with Al Salam Bank (ASBB). This follows a similar assent given by ASBB’s shareholders in an EGM which took place last month (see Vol 10 Issue 41). According to Sheikh Khalid Mustahail Al Mashani, the chairman of BMI Bank, the proposed business combination with ASBB will result in the combined entity becoming the fourth-largest commercial bank in terms of assets and fourth-largest in terms of equity within the kingdom of Bahrain. “We are now working alongside ASBB to complete the legal and regulatory formalities to combine the two businesses which will provide all our customers with a range of quality products and services creating genuine value for all our stakeholders,” said Khalid. As agreed by both parties, the merger is to be carried out through an exchange of 11 ASBB shares for each BMI share. Under the resolution, ASBB will acquire 58.5 million shares from BMI at BHD1 (US$2.59) per share and subsequently will issue 644 million shares at 100 Bahraini fils (US$0.26) each. The merged entity will command approximately BHD1.8 billion (US$4.67 billion) in assets, a financing facility of about BHD1.2 million (US$3.11 billion) and a total equity exceeding BHD290 million (US$752.54 million). During the first three quarters of the year, BMI managed to record a net profit of BHD880,000 (US$2.28 million), representing an increase of 141% compared to the same period in 2012. For the third quarter itself, the bank announced a 325% hike in net profit to BHD340,000 (US$882,292), from the BHD80,000 (US$207,598) it made in the third quarter of 2012. BMI’s total income was accounted at BHD16.5 million (US$42.81 million), up from BHD15.7 million (US$40.74 million) reported in the corresponding period last year.