JPMorgan subsidiary to sell Saudi Investment Bank stake for $203 million

JPMorgan International Finance, which has held a minority stake in Saudi Investment Bank since 1976, will divest its holding by selling its shares back to Saudi Investment Bank
Updated 25 June 2018
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JPMorgan subsidiary to sell Saudi Investment Bank stake for $203 million

  • A subsidiary of JPMorgan Chase & Co has agreed to sell its minority stake in Saudi Investment Bank for 759.3 million riyals ($203 million)
  • JPMorgan, which is the only U.S. bank providing both commercial banking and securities services in the kingdom, did not disclose the size of the stake or the financial terms of the deal

DUBAI: JPMorgan Chase has become the latest international bank to trim its exposure to Saudi Arabia, with an agreement to sell its minority shareholding in Saudi Investment Bank.

But the bank, the only US lender providing both commercial banking and securities services in Saudi Arabia, has insisted that it remains committed to the Kingdom, stating that the sale is part of winding-down of “non-core holdings and projects.”

Saudi subsidiary JPMorgan International Finance, which has held the stake since 1976, agreed to sell shares representing 7.49% of the SIB’s capital back to the bank for 759.3 million riyals ($202.2 million), the Saudi bank said in a statement on Tadawul on Sunday. 

The transaction was subsequently confirmed by JPMorgan in a statement sent to Reuters. 

The agreement to sell down shares in SIB comes a month after UK lender RBS agreed to sell its stake in Alawwal Bank, as part of a merger between Alawwal and SABB.

The merger — which will create Saudi Arabia’s third largest lender — comes as RBS looks to exit Saudi Arabia due to its own capital requirements. 

JPMorgan on Sunday insisted that it remains optimistic about the Kingdom’s economic prospects, and is seeking to benefit from other opportunities stemming from reforms being pushed by Crown Prince Mohammed bin Salman.

“Globally, the firm has wound-down non-core holdings and projects over the past several years and this proposed sale is consistent with that consolidation effort,” said Bader Alamoudi, senior country officer for JPMorgan, told Reuters.

“We are excited and optimistic about the kingdom’s economic prospects, the opportunities offered by Vision 2030 and our firm’s ability to support it.” 

JPMorgan is among banks advising the Saudi government on the upcoming listing of Saudi Aramco, likely to occur in 2019, which may raise as much as $100 billion.

SIB shares rose 2.1 percent on Sunday on the Tadawul, on a day when shares in most banks, financial service providers and insurers finished in positive territory. 

Arms of the Saudi government are collectively the largest shareholder in SIB, the tenth-largest Saudi bank by assets, owning 34.6 percent, according to Thomson Reuters data. 


Former Nissan chairman Ghosn appears in Tokyo court

Updated 23 May 2019
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Former Nissan chairman Ghosn appears in Tokyo court

  • It is the first of a series of hearings to iron out logistics for Carlos Ghosn’s actual trial
  • Nissan’s former chairman has hired a strong legal team as he fights to clear his name

TOKYO: Nissan’s former chairman, Carlos Ghosn, appeared in a Japanese courtroom Thursday for a hearing ahead of his trial on accusations of financial misconduct.
It was the first of a series of hearings to iron out logistics for Ghosn’s actual trial. The trial date has not been set, and experts say it could be months away.
Ghosn, who led the Japanese automaker for two decades, was arrested in November and charged with underreporting his income and breach of trust. He was released on bail in March, rearrested in April on fresh accusations and then released again on bail on April 25.
Ghosn insists he is innocent and says he was targeted in a “conspiracy” by others at Nissan Motor Co.
Nissan, which is allied with Renault of France, has seen profits nose-dive amid the fallout from Ghosn’s arrest.
Ghosn has hired a strong legal team as he fights to clear his name. One of his top lawyers, Junichiro Hironaka, was seen walking into the courtroom Thursday with Ghosn.
One of the conditions of Ghosn’s release on bail is that he is forbidden to contact his wife. Prosecutors say that’s to prevent evidence tampering.
Ghosn’s lawyers challenged that restriction, saying it is a violation of human rights, but the Supreme Court rejected their appeal Tuesday.
The lawyers can appeal again to have the restriction removed.
In a briefing Thursday, Deputy Chief Prosecutor Shin Kukimoto welcomed the Supreme Court’s decision.
“For married people to be together is important, but I feel there was enough reason for the Supreme Court to support us in this restriction,” he said.
Kukimoto declined comment on the hearing, which was closed to reporters and the public.
Kukimoto also said the maximum penalty upon conviction of all 15 counts of the charges Ghosn is facing is 15 years in prison and a fine of ¥150 million ($1.4 million).