MUSCAT, 22 March 2007 — Gulf Merchant Group (GMG), a UK-based international investment banking and asset management firm, is to set up a full-fledged commercial bank in Oman with a paid-up capital of 50 million rials ($130 million), following a go-ahead by the Central Bank of Oman (CBO).
Sayyid Asaad bin Tariq Al-Said, a Royal Family member, is to be the chairman of Oman Merchant Bank (OMB), which is expected to be operational by year-end , following an initial public offering on the Muscat Securities Market (MSM).
“We are seeing a gradual opening of the Omani economy that is creating an investment-friendly environment to attract the much-needed foreign direct investment (FDI) into the sultanate”, Sayyid Assad said, adding that “the government is also committed to major infrastructure developments that will accommodate the needs of a young and growing population in line with the vision of Sultan Qaboos bin Said.’’
He said OMB’s focus on corporate and investment finance means that the bank will be well poised to capitalize on the opportunities created by these important developments.
Key factors driving GMG’s decision to launch the bank include the growing economic strength of Omani; deregulation; liberalization and privatizations, not to mention a viable population growth combined with changes expected in private wealth management, he explained.
Nabil Maaloul, CEO of GMG, said: “All the founders of OMB, including GMG, will hold 60 percent of the bank as per local Capital Market Authority (CMA) rules. The remaining 40 percent will be offered to the public
“We plan to launch the IPO before the end of 2007. We see a huge range of opportunities across the AGCC markets particularly in investment banking and asset management, and we will, no doubt, move into other countries when required.’’
Maaloul said OMB will provide a full banking platform for retail, corporate and investment banking clients — including asset management and wealth management services. OMB will be a full-fledged commercial bank. “We are delighted to be given this opportunity to participate in the growth of the Omani economy.”
We are committed to provide vital corporate and investment banking services. Furthermore, Omani nationals will be able to work and invest in the bank and its future. We are also considering a secondary listing on a reputable international exchange such as London or Dubai’s Difx to allow regional investors to participate in a bank we believe will become an important player in the Omani economy.”
Banks in Oman had made a combined net profit of RO158.091 million - provisional - last year. The growth in profitability was attributed to a 20.5 per cent growth in total bank credit and a 20 per cent jump in private sector credit. Total bank credit as at the end of December 2006 stood at RO4.694 billion as compared to RO3.896 billion in 2005. Private sector credit stood at RO4.388 billion as compared to RO3.658 billion in 2005. Of the total bank credit, credit in foreign exchange stood at RO767.3 million as against RO714.44 million.
Total assets of banks crossed RO7 billion at RO7.199 billion as against RO5.629 billion in 2005, a growth of nearly 28 per cent. Of which domestic and foreign assets stood at RO5.632 billion and RO1.566 billion, respectively. Core capital and reserves stood at RO742.489 million.
Combined credit and deposits stood more less same, probably for the first time at RO4.694 billion and RO4.671 billion, respectively. It’s indeed a sign of improvement, which will further boost the banking industry credibility across the region. Further, saving deposits crossed RO1 billion at RO1.035 billion, an increase of 18 per cent. Private sector deposits recorded a growth of 25 per cent at RO3.851 billion. Demand and time deposits stood at RO884.635 million and RO1.931 billion, respectively. Foreign exchange deposits grew by 59 per cent to RO1.191 billion as against RO748.94 million.
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