Banking & Finance

Bahrain bank merger to complete in 2025

November 15, 2024, 11:46 AM

People queueing to use a National Bank of Bahrain ATM in Manama. The merger with Bank of Bahrain and Kuwait was announced this year

NBB and BBK keen to proceed
Combined equity of $3.2bn
Mumtalakat has 44% NBB stake

A merger between National Bank of Bahrain (NBB) and Bank of Bahrain and Kuwait (BBK) is expected to be completed in 2025.

Plans to join the two banks were announced to the Bahrain Bourse earlier this year and preliminary proceedings started this month.

“Considering that we are almost at the end of this year, I think this is definitely something that we would like to conclude well within next year,” said Usman Ahmed, Group CEO of NBB.

The banks have played a prominent role in the kingdom’s domestic banking, both retail and wholesale, for decades. NBB was licensed in 1957 and BBK in 1971.

At the end of 2023 NBB had equity of $1.5 billion and BBK $1.7 billion. Their customers’ deposits were $9.3 billion and $5.8 billion respectively.

Bahrain’s sovereign wealth fund Mumtalakat has a 44 percent stake in NBB. The bank confirmed in June that Goldman Sachs had been appointed financial advisor for the merger negotiations with BBK.

Four years ago NBB completed its takeover of Bahrain Islamic Bank.

In August this year NBB increased its shareholding in Sico, a regional asset manager, broker and investment bank, from 12.51 percent to 21.07 percent.

“We continue to be open to important opportunities,” Ahmed told AGBI at the Bahrain Airshow this week.

NBB reported a 14 percent increase in net profit attributable to shareholders for the first six months of 2024, recording BHD46.6 billion ($123.6 million) compared to BHD40.8 million for the same period in 2023.

The bank operates 20 branches across Bahrain, with other sites in Abu Dhabi, Dubai and Saudi Arabia.

Ahmed said the focus was on increasing the bank’s footprint in those jurisdictions where they currently have commercial banking licenses, with a view to partnering with fintech companies.

“That’s one of the ways that we are keen to expand,” he said.