JEDDAH, 11 February 2006 — The Bahrain Monetary Agency (BMA) licensed a number of Saudi and Gulf investors to establish an Islamic bank with a capital of $500 million. The Yazi Bank is expected to begin operations in the second quarter of this year. The bank will manage direct investment funds while offering support investment services in the Gulf, especially in the Saudi market and the UAE.
Yazi Bank was licensed on Dec. 6. It will work through the investment funds in buying and selling small and medium companies that need an increase in capital or nominated for mergers with a focus on strategic qualities of growing companies. The bank’s establishment is taking place in the light of current low competition in direct investment activities in compliance with Islamic laws.
Liquidity in Saudi Arabia and the UAE, which are over $1.2 billion, are considered one of the motivators for investment, in addition, these kinds of deals that are highly specialized with the possibility of reaching the region’s markets by focusing on added value as an encouraging factor. Yazi Bank comes as a chance for investors because it works in direct investment in private companies and bank services. Capital for the bank is expected to be complete in a short period due to its quality investment services in compliance with Islamic law and compliance of its activities with the recent positive developments expected in the Gulf.
“Placement exercise for the bank will begin Feb. 11 and will be for four weeks,” said founder of the project, Abdul Aziz Al-Mutlaq. The nature of the bank’s job of minimizing financial and legal risks in addition to the strategic depth for the founders in the region, are also positive attractions. “Its activities will be in mergers, acquisitions, initial public offerings (IPOs) and private equity,” Al-Mutlaq told Arab News.
Heading the formation committee of the bank is Dr. Abdul Rahman Al-Hussaini who had established a number of commercial establishments in Saudi Arabia and the Arab world. Al-Mutlaq will be managing director and CEO of the bank. He has around 20 years experience in Islamic banks and specializes in investment banking.