Warba Bank, a leading Islamic bank in Kuwait, said it has signed an agreement with Bahrain-based Ahli United Bank BSC and its subsidiary Ahli United Bank KSCP to acquire their respective shareholding in Kuwait and Middle East Financial Investment Company, representing 75.72 per cent of the company's outstanding shares, subject to securing all regulatory approvals.
The sale and purchase agreement was signed in the presence of Shaheen Hamad Al Ghanem, Warba Bank’s Chief Executive Officer and Tareq Muhmood, acting Chief Executive Officer of Ahli United Bank (Kuwait).
This acquisition stems from Warba's strategic growth initiative which calls for the establishment of an asset and wealth management platform that positions the bank to provide an integrated financial product offering to its retail and institutional customers, whilst concurrently accelerating our strategic objectives by acquiring a leading firm in the asset management and financial services field, stated Al Ghanem.
"This deal debuts our investment activities in 2019 following the capital increase last year, which resulted in strengthening the Bank’s capital base reaching KD285 million ($935 million) by the end of 2018," he noted.
"The share capital increase of 50 per cent was fully covered by the bank’s shareholders oversubscribing to all shares offered for a total amount of KD90 million," he added.
Al Ghanem pointed out that the capital increase establishes a solid base to grow the bank’s investments in the upcoming period in vital economic sectors, as well as for financing mega national and regional projects that will secure steady and lucrative returns for both shareholders and customers.
"The capital increase is also a key factor in strengthening the bank's operations and expansion in the corporate sector, which would solidify its leading position in the banking industry; this will be achieved by providing financing facilities for local companies and projects across economic sectors including: oil and gas, education, construction and contracting; as well as participating in syndicated financing deals with other banks," he stated.
"In the next two years, the Bank will also seek to achieve greater risk allocation balance and diversification between its real estate portfolio and other sectors," he added.
On the deal, Muhmood said: "The decision to sell AUB’s share in Kuwait and Middle East Financial Investment Company came in line with the Bahraini bank's strategic objectives with a view to ensure our focus on our core businesses."
The public shareholding company, which got listed on the Kuwait Stock Exchange in 1997, operates within the diversified financial sector with emphasis on asset management.
"He has further commented that the positive impact of this transaction on AUB will serve the interests of both our shareholders and customers," he added.-TradeArabia News Service