Shareholders approve plans for new Ithmaar group structure

Business

Shareholders approve plans for new Ithmaar group structure

Shareholders of Ithmaar Bank, a Bahrain-based Islamic retail bank, today approved (ed note: 28/03/16) plans for a brand-new group structure designed to further create the growth attained in the core retail banking business, the strategic focus of the Bank.

The strategies, which were suggested by the Ithmaar Bank Board of Directors, and are subject to regulatory approvals, entail the creation of a brand-new holding company that will be listed on the Bahrain Bourse and also the Kuwait Stock Exchange as well as licensed and managed by the Central Bank of Bahrain (CBB). The brand-new holding firm will retain 100 percent ownership of all assets currently owned by Ithmaar Bank.

The news was made by Ithmaar Bank Chairman, His Royal Highness Prince Amr Al Faisal following the Bank's Extraordinary General Meeting (EGM) with shareholders which adhered to the Annual General Meeting (AGM). Also present at the meetings, which were held at the Ramee Grand Hotel in Bahrain, were Directors as well as members of the Ithmaar Bank Executive Management group, representatives of the Bank's Sharia Supervisory Board, the CBB, the Ministry of Industry and Commerce, statutory auditors PricewaterhouseCoopers, as well as the Bahrain Bourse.

"On behalf of the Board of Directors, I delight in to introduce that the strategic decisions we took early in 2014, which were developed to significantly transform the Group's operations, are continuing to deliver favorable results, as well as the new group structure is the next key step in this transformation," said HRH Prince Amr. "This brand-new framework is developed to assist in understanding our long-term strategy for development by offering better insight into the strength of our core retail banking operations and greatly promoting the management of the Group's investment assets," he said.
"This brand-new group structure follows extensive internal review as well as discussions, and also is driven by our commitment to guaranteeing we are well placed to gain from brand-new opportunities in the present market," said HRH Prince Amr. "The new structure will certainly aid reduce the risk profile of the new banking entity and also enhance shareholder value by showing the growth and also improved performance achieved in the core business. In the existing structure, this growth is being negatively influenced by investment valuations and also impairment stipulations," he said.

Ithmaar Bank Chief Executive Officer, Ahmed Abdul Rahim, who delivered a thorough presentation to shareholders, stated these strategies build on the substantial enhancements accomplished due to the implementation of the key tactical decisions taken by the Board of Directors in 2014.

"The key decisions, which included initiatives for enhanced revenue, improved margins, the divestment of non-core assets, and also price reductions throughout the Ithmaar Group have, together with the continued development of our core retail business, contributed in a huge way to the Bank's continuously improving economic efficiency," said Abdul Rahim.

"The 2015 monetary results, approved on 28 February 2016, reconfirm that our initiatives to substantially change the Group's operations and also concentrate on establishing our core business are paying off, which we are on the appropriate track," said Abdul Rahim. "Our decision to reorganise the Group stands for a further stage in this procedure, and underscores our dedication to becoming one of the area's leading Islamic retail financial institutions," he stated.

"By designating our assets into different subsidiaries, we will have the ability to better concentrate on our core retail financial businesses held in the new financial body, including Faysal Bank Limited, Pakistan, a retail and also corporate banking subsidiary of Ithmaar Bank. At the same time, we will certainly have the ability to promote independent and focussed disposal of financial investment properties held by the investment body, when appropriate chances occur," said Abdul Rahim. "This new team framework will certainly additionally consolidate Ithmaar Bank's placement as a solid retail-focussed premier Islamic retail financial institution under the Ithmaar brand, far better permitting the Bank to make the most of brand-new development possibilities, as well as aid to create greater value to our shareholders," he said.

During 2015, Ithmaar Bank's pioneering organization with Eskan Bank remained to support taking care of the Kingdom's housing challenges by offering Bahraini residents government-subsidised financing via Ithmaar Bank to aid them acquire their first houses as part of a nationwide system. Ithmaar Bank likewise authorized an arrangement with Tamkeen, a Bahrain semi-government organisation which works to make the economic sector the key driver of lasting economic advancement, and also substantially raised its allotment to the joint Ithmaar-Tamkeen organization financing scheme profile. In 2015, to note the Holy Month of Ramadan, Ithmaar Bank launched a first of its kind Qard Hasan (profit-free funding) for low income dedicated customers as well as, later in the year, also introduced Bahrain's most rewarding Credit Cards loyalty programme, Ithmaar Rewards.

During 2016, Ithmaar Bank continuing to broaden its retail banking network, already one of the largest in Bahrain, and also will quickly inaugurate a brand-new, full-service branch in Galali-- its eighteenth branch in the Kingdom. Ithmaar Bank is likewise in the process of adding two new ATMs, bringing the complete number of ATMs to 48.