Masraf al Rayan

#Mergers among smaller Islamic banking industry likely in GCC

There are several rumors about possible mergers of the smaller Islamic banks in the GCC region. According to UCapital, the relatively small size of Islamic banks is one of the compelling reasons for them to consider consolidation. However there is no compelling reason for a big number of regional banks to rush into merger deals. Banks across the region are facing pressure on profitability and tighter liquidity. The UAE, Bahrain and Oman would benefit from consolidation as many banks in these countries lack sufficient scale. A proposed merger of Kuwait Finance House and Ahli United Bank is expected to result in second biggest Islamic Bank in the GCC. Merger of Qatari banks Masraf Al Rayan, Barwa Bank and International Bank of Qatar which was announced last year is progressing and is expected to complete by end of the year.

New round of GCC bank #mergers in the offing

GCC's banking sector is expected to see a new round of mergers and acquisitions (M&A) in the wake of the latest such move initiated by Kuwait Finance House and Ahli United Bank of Bahrain. According to U Capital, at least five M&A deals are in various stages of discussion. The new round of M&A follows the merger between National Bank of Abu Dhabi (NBAD) and First Gulf Bank (FGB) in the UAE, resulting in creation of the regions second biggest bank. Combined assets of four top conventional banks in the region stand at $621 billion whereas the assets of entire Islamic banks in GCC stand at $563 billion as of second quarter 2017. According to banking sources, Masraf Al Rayan, International Bank of Qatar and Barwa Bank are in the due diligence phase. The three-way merger is expected to create the largest Islamic bank in Qatar. Saudi British Bank and Alawwal Bank are also said to be discussing a potential merger that would create the third-largest bank in Saudi Arabia.

Three-way bank #merger in #Qatar aims to close by year end -sources

Executives working on a three-way bank merger in Qatar expect to finish valuing the deal in the coming weeks. Shareholders at Masraf Al Rayan, Barwa Bank and International Bank of Qatar are committed to pushing ahead with the deal despite the current embargo by some of Qatar's Arab neighbours. A shake-up has long been mooted in the Qatari banking sector given that 18 local and international commercial banks serve a population of 2.6 million. The more than two-week travel and diplomatic boycott could further dent bank performance if the dispute drags on. In December, Reuters reported that the trio had begun merger talks which would create the Gulf state's second-largest bank. The new bank, which would be run in compliance with Islamic banking principles, would have assets worth around 160 billion riyals ($43.6 billion).

#Merger of three #Qatari #banks to take six months

The merger of Qatari banks Masraf Al Rayan, Barwa Bank and International Bank of Qatar is said to take six months to complete, Masraf Al Rayan’s chairman Hussain Ali al-Abdulla said lately. In December Reuters had reported that merger talks had begun which, if successful, would create the Gulf state’s second-largest bank. The new bank would have assets worth more than 160 billion riyals ($44 billion).
KPMG and PricewaterhouseCoopers have been appointed as merger advisers, along with law firm Allen & Overy as legal adviser, and furthermore the Barwa Bank and International Bank of Qatar. Masraf Al Rayan’s shareholders approved the issuance of sukuk worth up to $2 billion to meet the bank’s liquidity needs. In January banks had been appointed to handle a debut sukuk issue of around $500 million, banking sources told Reuters that month, but Abdullah said on Sunday the timing of the issue had not been finalised. Asked whether the bank’s liquidity had been affected by low oil prices Abudullah said “liquidity now is better than in 2016” and that the U.S. Federal Reserve’s raising of interest rates last month would improve the profits of Qatari banks.

Shareholders at #Qatar's Masraf Al Rayan approve #sukuk #issuance for up to $2bln

The shareholders of Qatar's Masraf Al Rayan, an Islamic lender, approved the issuance of sukuk worth up to $2 billion to meet the bank's liquidity needs on Sunday. The Gulf state's second largest lender by market value appointed banks in January to handle a debut sukuk issue of around $500 million, banking sources told Reuters that month.

#Qatari bank #merger will ‘rebalance’ the market – Moody’s

According to Moody’s Investors Service, a proposed merger between three Qatari banks would help “rebalance” the banking sector in the country. The merger is currently at due diligence stage and will be subject to approval by the relevant authorities. The merged entity between Masraf Al Rayan, Barwa Bank and International Bank of Qatar would create the largest Islamic bank and second largest lender in Qatar. Total assets would amount to around QAR173bn ($48bn) and the market share would be around 14%. Moody’s assistant vice president Nitish Bhojnagarwala said Islamic banking asset growth has outpaced conventional banking in Qatar, as demonstrated by a 21% compound annual growth rate of loans for Islamic banks between 2011 and 2016 compared with 14% for the conventional banks. The GCC is witnessing a consolidation in the banking sector, with the two largest lenders in Abu Dhabi also currently preparing to merge.

#Qatari bank trio in talks for potential $44 b #merger

Qatari banks Masraf Al Rayan, Barwa Bank and International Bank of Qatar have begun initial talks for a potential merger. This deal would create the Gulf state's second-largest bank and it would have assets worth more than 160 billion riyals ($44 billion). If the deal goes ahead, it would be a rare example of consolidation among banks in the Gulf, which have previously been reluctant to tie up. The previously lavish state spending is now being trimmed to adjust to lower oil prices and the argument for consolidation is now more compelling. Though negotiations have begun, there is no guarantee any agreement will be reached. The proposed merger of Rayan, Barwa and IBQ depends on financial and legal due diligence, as well as securing approvals from regulatory authorities and shareholders of all three banks.

Moody’s upgrades #ratings of Masraf Al Rayan

Moody’s has upgraded Masraf Al Rayan’s long term issuer ratings to A1 from A2. Counterparty Risk Assessment is changed to Aa3 from A1. The outlook on the long-term ratings has changed to stable from positive. The upgrade of Masraf Al Rayan’s ratings reflects continued business diversification as a result of growth and profitability of the UK subsidiary. Moody's expects these diversification trends to continue as the bank’s UK subsidiary grows further. The rating agency also expects that Masraf Al Rayan will maintain strong capital ratios, as healthy internal capital generation supports the needs of future asset growth.

Chelsea Barracks: #Tax consequences of Islamic Finance product heard by the Court of Appeal

In 2008 the #Qatar owned Project Blue entered into an arrangement to acquire the former Chelsea Barracks in West London from the Ministry of Defence for £959 million. Monies were advanced by Masraf al Rayan Bank using an ijara arrangement for the transaction. Now the Court of Appeal has found that the Revenue and Customs authority should have sought Stamp Duty Land Tax from the bank rather than the purchaser, but was apparently out of time to raise such an assessment. Eventually, the machinery in the Finance Act 2003 was not up to the task of ensuring an ijara was treated for tax purposes in the same way as any other transaction. As the adoption of Islamic Finance instruments increases, British tribunals, courts and regulators will need to understand the structures more clearly.

Qatar's Masraf Al Rayan sees 8-10 pct profit growth in 2016 - chairman

Qatar's largest sharia-compliant bank Masraf Al Rayan is expected to post annual profit growth of between 8 and 10 percent in 2016, Chairman Hussain Ali al-Abdulla said at the bank's annual general meeting. Masraf Al Rayan reported last month a 3.6 percent rise in full-year net profit in 2015 to 2.07 billion riyals, although its fourth-quarter earnings dipped slightly. Abdulla said the bank had no plans to issue sukuk, or sharia-compliant bonds, this year as there was no need for additional liquidity. Falling liquidity is expected to be one of the main issues facing banks in the Gulf region in 2016, as governments remove cash on deposit to help replace lost revenue from lower hydrocarbon prices.

Qatar's largest Islamic bank eyes 8-10% growth in 2016

Qatar's largest sharia-compliant bank Masraf Al Rayan is expected to post annual profit growth of between 8 and 10 percent in 2016, Chairman Hussain Ali al-Abdulla said at the bank's annual general meeting. Masraf Al Rayan reported last month a 3.6 percent rise in full-year net profit in 2015 to 2.07 billion riyals, although its fourth-quarter earnings dipped slightly. Abdulla said the bank had no plans to issue sukuk this year as there was no need for additional liquidity. Falling liquidity is expected to be one of the main issues facing banks in the Gulf region in 2016, as governments remove cash on deposit to help replace lost revenue from lower hydrocarbon prices.

QInvest completes debut $200m five-year syndicated facility

QInvest, Qatar’s leading investment group and one of the most prominent Islamic financial institutions in the world, announced the completion of its debut $200m five year syndicated facility.

The facility is in line with the bank’s funding diversification and capital efficiency plan and was arranged by QInvest’s key regional and international relationship banks, namely Masraf Al Rayan, Al Khaliji France S.A. and Natixis. QInvest previously announced that it was named the “Most Innovative Investment Bank from the Middle East” at The Banker magazine’s Investment Banking Awards 2015.

Moody's affirms Masraf Al Rayan's issuer ratings: outlook now positive from stable

Moody's Investors Service has affirmed Masraf Al Rayan's (MAR) A2/Prime-1 issuer ratings and baa3 baseline credit assessment (BCA) and adjusted BCA. At the same time, Moody's changed the outlook on the bank's long term issuer ratings to positive from stable. The change in the outlook to positive from stable reflects the ongoing improvements in MAR's business and geographic diversification, including the growth and transition to profitability of its recently acquired subsidiary Al Rayan Bank PLC based in UK. Further underpinning Moody's view on the outlook is Qatar's considerable economic strength, with robust growth prospects driven by the significant wealth and resources of the country, despite lower oil prices.

Moody's affirms Masraf Al Rayan's issuer ratings: changed outlook to positive from stable

Moody's Investors Service has affirmed Masraf Al Rayan's (MAR) A2/Prime-1 issuer ratings and baa3 baseline credit assessment (BCA) and adjusted BCA. At the same time, Moody's changed the outlook on the bank's long term issuer ratings to positive from stable. Moody's affirmation reflects MAR's continued strong core financial fundamentals with (1) consistently strong asset quality performance, (2) strong and stable profitability and (3) solid capital buffers. The change in the outlook to positive from stable reflects the ongoing improvements in MAR's business and geographic diversification. Further underpinning Moody's view on the outlook is Qatar's considerable economic strength.

Qatar’s Masraf Al Rayan Eyes Potential Debut Sukuk Issue -Sources

Qatar’s Masraf Al Rayan is eyeing a debut in the debt capital markets this year after inviting bankers to pitch for arranger roles on a potential U.S. dollar-denominated benchmark sukuk issue, sources said on Monday. The sharia-compliant institution is expected to raise funds before end-April. Masraf Al Rayan is “very close” to mandating arrangers for the upcoming sukuk issue, two sources said. Masraf Al Rayan joins a growing pipeline of potential Gulf issuance as borrowers want to obtain funds from the dollar debt markets before a possible increase in interest rates by the U.S. Federal Reserve later this year.

Qatar's ETF to help pace of foreign fund inflow

Islamic lender Masraf Al Rayan announced it will be launching two debut funds. Of these, the Shariah-compliant Qatari equity ETF, to be listed on the Qatari bourse , is targeting foreign investors. A sukuk fund will be focused on sukuk in the GCC. Both funds will be managed by Masraf Al Rayan 's wholly-owned subsidiary, Al Rayan Investment. Al Rayan Investment manages the Sharia-compliant Al Rayan GCC Fund which invests in select companies across the GCC based on a 24-month investment horizon. The fund has two classes, 'Q' and 'F'. The Q-Fund is denominated in Qatari Riyal and is open to Qatari individual and institutional investors, while the F-Fund is denominated in US Dollars and is open to all investors, resident in any part of the world.

Islamic Bank of Britain shareholders endorse Al Rayan Bank name change

Shareholders of the Birmingham-based Islamic Bank of Britain have given their approval to change its name to Al Rayan Bank. As a result of the rebranding, the bank has introduced a new Al Rayan Bank logo and brand identity, which are being implemented across its website, literature and branches. Al Rayan Bank’s activities will continue to be monitored by an independent Sharia supervisory committee and a dedicated compliance officer. It will continue to operate as a UK regulated bank and customers’ deposits will remain protected by the Financial Services Compensation Scheme.

Islamic Bank of Britain changes name to Al Rayan Bank

Islamic Bank of Britain (IBB) plans to change its name to Al Rayan Bank PLC, subject to formal shareholder approval. The change will be completed in December 2014. The rebrand follows IBB's acquisition, earlier in the year, by Qatar-based Masraf Al Rayan (MAR). Rebranding activity will involve the introduction of a new Al Rayan Bank logo and brand identity. It will continue to operate as a UK regulated bank, and customers' deposits will remain protected by the Financial Services Compensation Scheme. With an increased focus on corporate and real estate finance, Al Rayan Bank will develop its presence in London. Its retail banking and operational head quarters will remain in Birmingham.

UK’s IBB is set to become Al Rayan Bank, serving Muslims, non-Muslims alike

The synergy between the Islamic Bank of Britain (IBB) and its parent company Masraf Al Rayan will soon be reflected in the British bank’s name. Customers were informed last week that the new name for IBB to be adopted towards the end of the year will be Al Rayan Bank. Sultan Choudhury, chief executive officer of IBB, emphasised in the letter he sent out last week informing customers about the name change that the bank remains British regulated with a British board. The bank has invested heavily in its internet banking capability which has opened up its services to a much broader customer base. Its latest data also shows a big surge in non-Muslim customers.

Masraf Al Rayan acquires Islamic Bank of Britain

The Islamic Bank of Britain (IBB), the UK’s only wholly Sharia compliant retail bank, has been acquired by Al Rayan (UK), the UK subsidiary of Masraf Al Rayan (MAR). The acquisition follows a cash offer made on 28 November 2013 for which MAR received over 95 per cent of valid shareholder acceptances, together with approval of the Prudential Regulation Authority for MAR to take control of IBB. MAR considers the acquisition an opportunity to expand its footprint and introduce its range of products to a fertile market with potential for continued growth. It will also enable Masraf Al Rayan to offer its existing Gulf-based customers additional services as they expand their activities into the UK.

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