| BankMuscat looks to mop up 96.7m rials |
Staff Reporter
MUSCAT BankMuscat intends to raise 96.7 million rials from a rights issue aimed at enhancing its Tier 1 capital. The bank will offer 226.5 million shares at 0.427 baisa per share comprising a nominal value of 100 baisas, premium of 325 baisas and issue expense of 2 baises per share.
The rights issue will be open from July 9 to 23 with the record date on July 2. Each existing shareholder as on the record date is entitled to subscribe to one new share for every eight shares held.
“BankMuscat will utilise the proceeds of the issue for financing growth resulting from the credit expansion following general economic growth in the Sultanate. In addition, the proceeds will be utilised for capitalising Islamic banking business and enhancing capital adequacy ratio to enable readiness for adoption of Basel III when it is introduced,” Ahmed Al Abri, Chief Operating Officer (COO) said while announcing the rights issue at an investor meet hosted at MSM on Wednesday.
Besides Abri, the BankMuscat panel included Sulaiman Al Harthy, Group General Manager – Islamic Banking, Abdullah Al Hinai, DGM - Investment Banking, T. Ganesh – Chief Financial Officer, and Sheikha Al Farsi, AGM, financial control, strategy and planning. The senior management team also elaborated on the Bank’s strategy, business growth and capital position. It was attended by shareholders, investors and analysts from brokerage and investment companies.
Making a presentation on the rights issue and business strategy of the bank, Ganesh said, “The bank’s present authorised share capital stands at 250 million rials, consisting of 2,500,000,000 shares. Of this, 1,812,009,497 shares have been issued and fully paid-up. Following the rights issue, the issued and paid-up capital will be 2,038,510,684 shares with a nominal value of 100 baisas each.”
“We are fully geared to launch Meethaq Islamic banking window operations, subject to CBO approval. The board of directors has approved a capital allocation of up to 150 million rials for Meethaq operations. The bank has also announced a three-member Shariah board comprising respected Sharia scholars in Islamic finance,” Ganesh said.
Meethaq seeks to commence operations in the third quarter this year and plans a network of seven branches at launch during the first year of operations. The branch network will be expanded from time to time subject to business viability as well as profitability margin on overall Meethaq portfolio, he said.
“With its wide distribution network and long track record, BankMuscat has built 38.03 per cent market share of total banking assets and 34.37 per cent market share of total banking credit in Oman as on March 31 this year,” Ganesh said.
BankMuscat has the highest investment grade credit rating assigned to any Omani bank of A-, A1, A- and A from all the four major rating agencies - Standard and Poor’s, Moody’s, Fitch Ratings and Capital Intelligence – respectively, he said.
The members of existing senior management team have been with the Bank for more than 10 years. The experience and depth of the Bank’s management team has been a key factor in achieving and maintaining leadership position in the Omani banking market, he said.
Oman Tribune
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