Bahrain Islamic Bank

Bahrain Islamic Bank, Al Salam in $4.5 bln merger talks

Bahrain Islamic Bank and Al Salam Bank are thinking about teaming up to create the Gulf Arab state’s largest Islamic lender. The both are known to be in merger talks to create the third largest bank in Bahrain, with assets of BHD 1.7 billion ($4.5 billion).
The statement added that the two boards of directors stated that consolidation is the way forward for local banks in general and Islamic banks in particular in the aftermath of financial crisis and economic downturn and greater competitive banking environment in the region.

Bahrain Islamic Bank cut to junk at Moody's on loss, unrest

Because of their losses and after political unrest in the Arabian Gulf nation, Moody’s Investors Service cut off Bahrain Islamic Bank's credit ratings.
Moody's statement was that the decision "reflects a material weakening in the institution’s stand-alone financial profile, as shown in the significant losses it posted in the last two years and the erosion of its capital base in the absence of new capital injections".

Bahraini banks could suffer due to unrest

Abdulkarim Bucheery, chief executive of Bahrain Islamic Bank has said that international banks may cut financing lines to Bahraini lenders facing debt restructuring, due to the political unrest gripping the kingdom.

Kuwait's Investment Dar to sell $1.69bn assets

Kuwait's Investment Dar has proposed some $1.69bn in asset sales over three years to creditors as part of a $3.58bn restructuring plan, Reuters has reported, citing banking sources.
Dar will sell its stakes in Kuwait's Boubyan Bank and Bahrain Islamic Bank.

Moody's downgrades Bahrain Islamic Bank to Baa2/P-3/D

The downgrade of the BFSR and issuer ratings of Bahrain Islamic Bank reflects
- the difficult market conditions in which Bahraini banks continue to operate;
- the bank's deteriorated asset quality and heightened provisioning needs;
- Bahrain Islamic Bank's weak financial performance stemming from the cost of concentration risks materialising in heavy losses for two consecutive years;
- uncertainties over the bank's ultimate shareholding structure.

Bahrain Islamic Bank receives first rating from Moody`s

Martin Morris reported on 10 February on Arabianbusiness that Moody's Investors Service, has assigned Baa1 long-term and Prime-2 short-term local and foreign currency issuer ratings and a D+ bank financial strength rating (BFSR) to Bahrain Islamic Bank. (BisB). The rating outlook is stable.

Shortfalls and Overbanking in the GCC

Rohit Chawdhry, portfolio manager of Bahrain Islamic Bank, analyses the issue of overbanking in the Gulf region and the institutions anticipating mergers in the February issue of The Middle East. He concludes that all state plans fostering project developments are not covered by a sufficiently large banking sector. The Institute of International Finance estimates there are about USD 1.9 trillion worth of projects under way in the region, making the GCC one of the largest project finance markets in the world. But analysts estimate that the present project finance, which includes bank lending, bond and equity issuance, has a funding shortfall of at least $900bn, if not more. To create banks which are able to shoulder a greater proportion of the financing needs of projects under construction, by state and private investors is the challenge of the policy makers.

Bahrain Islamic Bank lowers profits marginally

Bahrain Islamic Bank announced on 21 January that its financial results for the year 2008, decreased to BD 22.3 mn net income from BD 25 mn for the year 2007, after making provisions against contingences that may arise in case the current international financial and economic crisis continues further.

The board of Directors has decided to propose to the Bank's AGM the distribution of 20% of dividends of paid up capital as of 31st December 2008 as 10% cash and another 10% bonus shares.

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