MANAMA, 4 March 2006 — Ithmaar Bank B.S.C., one of the leading Bahrain-based investment banks, has announced a net profit of $36.5 million for the year ending Dec. 31, 2005, reflecting an increase of 65 percent over $22.1 million earned in 2004. The increase in net profit reflected positive contributions from all areas of the business, including its associates. Ithmaar Bank’s 28-percent share in Faysal Bank Ltd.’s net profit for the year 2005 rose to $14.5 million from $8.7 million in 2004.
Shareholders’ equity amounted to a total of $247.3 million at the end of the year compared to $214.5 million in 2004, an increase of $32.8 million, or 15 percent. The bank’s consolidated total assets increased from $434.6 million to $442.3 million in 2005.
Funds under management aggregated $1.5 billion showing an increase of 36 percent over $1.1 billion in 2004.
“The year 2005 was a very successful year during which we focused on consolidating our businesses and strengthening our core operations,” said Ithmaar Bank’s chairman, Khalid Abdulla-Janahi. “The process of achieving sustained growth in profits will continue following the increase in Ithmaar’s share capital when the initial public offering is completed. Ithmaar’s investments into its subsidiaries and associates will give additional business impetus to their activities in the respective markets.” Janahi added that Ithmaar Bank is a growth vehicle for new markets as well as a holding company for subsidiaries and associates in other markets. It intends to engage in project finance, private equity (structuring, participation and portfolio management), advisory business (capital market advisory, mergers and acquisitions and project advisory) and underwriting business (debt and equity).
Ithmaar Bank launched its IPO on Feb. 19, 2006, which has already received a great response from investors. The IPO, one of the largest in Bahrain, offers 150,000,000 shares to the public. The last day for applications is March 12. The proceeds of the IPO will be utilized partly for new investment opportunities and also to provide additional capital to Ithmaar’s subsidiaries and affiliate companies.
The strategic partners to the IPO include Shamil Bank as the lead issue manager and financial adviser and KPMG as co-financial adviser. The bank has also entered into agreements with Global Investment House (Kuwait), Amwal (Qatar), Abraaj Capital (UAE), BBK (Bahrain) and Bahrain Pension Fund appointing them as underwriters to the IPO. Global Investment House has been appointed as the co-manager and listing adviser. Shamil Bank (Bahrain), BBK, Mashreqbank (UAE & Qatar) and Bank Ahli (Qatar) are the receiving banks for the IPO.
Meanwhile, Shamil Bank, on Tuesday announced a Shariah-compliant financing facility for individuals of all nationalities interested in subscribing for the Ithmaar Bank shares being offered through its IPO.
“Through this offering, Shamil Bank will finance up to three times the amount subscribed by the eligible customer,” said Tariq Bahar, the head of retail banking at Shamil Bank. “For every share of Ithmaar Bank the customer purchases, Shamil Bank will finance for up to three additional shares. The financing will be provided for a minimum of two months and a maximum of six months.”