MANAMA, 28 June 2007 — Albaraka Turk Participation Bank, a unit of Albaraka Banking Group (ABG), yesterday closed IPO subscription on the Turkish market. The IPO received an overwhelming response from individual and institutional investors and closed more than 32 times oversubscribed.
The bank offered 22.22 percent of its capital for public subscription totaling 54,500,000 shares with a value of 4.1 Turkish lire each, which amounts to 223,450,000 lire ($170 million) in three days last week. The number of shares totaled 1,741 billion with a total value of 7.139 billion lire ($5.4 billion), amounting to 32 times oversubscription by 23,894 investors of whom 22,731 investors were Turkish individuals and the remaining were foreign institutional investors. Of the shares offered for subscription, 63 percent were allocated to foreign institutional investors and 27 percent to individuals.
Adnan Ahmed Yousif, chairman of the board of directors of Albaraka Turk Participation Bank and president and CEO of Albaraka Banking Group, said the IPO excellent outcome “was a reflection of the trust of Turkish individual and institutional investors in the bank’s performance and results of operations. This also meant that Turkish investors viewed the bank’s shares as a rewarding long-term investment, especially after it had received a strong boost in the form of raising its credit rating by an internationally renowned rating agency, in addition to the strong support from the parent company Albaraka Banking Group.”
The international rating agency Fitch recently upgraded the bank’s ratings to foreign and local currency issuer default ‘BB-’ from ‘B’, national long-term ‘A+’ from ‘BBB+’ and support ‘3’ from ‘5’, while bank outlook remained “stable”.
Yousif said the group, after the remarkable success that it achieved in raising its capital through IPO, had used the funds raised through the IPO in increasing the capital of its affiliate units, the most recent of which was the Jordan Islamic Bank, as well as in opening branches for different banking units, especially in Algeria, Egypt and Turkey.
The group also intends to set foot in new geographical areas including Syria and Indonesia by setting up new subsidiary banking units. The group now has more than 230 branches with some 5,492 employees.