Bank Muscat’s Q1 profit rises as the sector consolidates

• Bank Muscat net income up 8%
• Q1 income of $153m
• Sohar set to take over Ahli Bank

First quarter net income at Bank Muscat, Oman’s largest bank by assets, rose 8 percent on higher interest revenue from both conventional and Islamic sharia-compliant activities.

The rise comes as rival Sohar International Bank, the country’s second-largest bank by assets, seeks to take over a smaller rival, raising concerns about competition in the Omani banking sector.

Bank Muscat reported Q1 net income of OMR59 million ($153 million). Net interest income from conventional banking and Islamic financing grew by 6 percent to OMR102 million, according to Bank Muscat’s statement to the Muscat stock exchange.

Operating expenses rose almost 6 percent to OMR55 million.

• Oman’s Sohar International Bank targets rival Ahli
• Takeover raises Oman bank competition concerns
• Total profits at Oman’s banks up 15% in 2024

Rival Sohar International is seeking to take over Ahli Bank. Ahli Bank has agreed but the takeover still needs regulatory approval.

“This is about the survival of the fittest, where small banks get absorbed by bigger ones,” Khalifa Jaidi, a retired financial adviser with Al Omaniya Financial Company, told AGBI last week.

“We have to be careful that we do not end up with fewer banks that dictate the financial terms by limiting the number of lenders.”

Banks in Oman recorded a 15 percent year-on-year rise in profits in 2024.