x Abu Dhabi, UAESaturday 22 July 2017

Ithmaar in new rights, Sukuk issue

Ithmaar Bank plans to raise up to $500 million through a rights issue and a five-year Mandatory Convertible Sukuk.

Ithmaar Bank plans to raise up to $500 million through a rights issue and a five-year Mandatory Convertible Sukuk. "We have received the Central Bank of Bahrain's No Objection in respect of the Mandatory Convertible Sukuk," said Khalid Abdulla Janahi, the chairman of the bank. "As for the rights issue and equity line of credit, they will be subject to the approval of the regulatory authorities in the kingdom of Bahrain. The benchmark size of the capital raising plans is between $400 million and $D500 million. All the above will further strengthen our capital base and liquidity position."

Mr Janahi also announced that an agreement had been reached with the US equity fund Global Emerging Markets of New York (GEM), whereby GEM would provide a line of credit up to $125m, which the bank will have the option to draw down over a period of five years at prevailing average volume and market prices, resulting in issuance of new ordinary shares. On Wednesday this week, Ithmaar Bank announced plans to pool resources with its wholly-owned subsidiary, Shamil Bank and create a single retail-focused Islamic bank, under the Ithmaar brand. The reorganisation plan is still subject to shareholder and other regulatory approvals.

Ithmaar Bank is listed on the Bahrain and the Kuwait bourses, and has a paid-up capital of $598m, and a total equity of $1.1bn. ngillet@thenational.ae