With the green light from their respective shareholders, three Bahrain based Islamic investment banks 
The announcement came after the extraordinary general meetings of the three banks held on Thursday approved the transaction. The merger will be effective after obtaining the final approval of the Central Bank of Bahrain and the Ministry of Industry and Commerce.
Once implemented, the newly created entity will have shareholders’ equity of almost $350million and assets in excess of $400million. The transaction is the first three- way merger to take place in the Kingdom of Bahrain.
“The aim of this merger is to establish a strong banking institution that is able to compete solidly in a changing market,” Isa Habib, Vice Chairman of Elaf Bank said.
“The merger will bring instant diversification of assets and revenues. Also, the bank will be able to capture larger projects and will enable it to diversify its capital sources.” He added that “this is in line with the Government of Bahrain’s efforts to enhance the banking sector and reinforce the Kingdom’s position as a regional and international financial hub.”
“The three banks will gain numerous benefits from the merger; in particular, the merged bank will have a strong balance sheet from day one which will create a positive impact on our dynamic banking sector. In addition to that, the merger shall enable the new entity to unify its strategy to provide innovative and targeted services to clients. I strongly believe that these three banks constitute a strong and logical combination which is capable of confronting any future challenges,” Mohammed Abdulmalik, Chief Executive Officer of Capivest said.
“The three banks have significant cumulative experience in financial services and each have particular niche strengths which when combined makes the whole greater than the sum of its parts. This fusion of competitive advantages in various markets makes us all excited and motivated to complete this merger and will work in the near future to announce the new brand identity of the bank which will reflect our client focus and future vision. We look forward to working side by side to achieve our shared goals,” Khalid Najibi, the Managing Director of Capital Management House, said.
“We would like to express our thanks and appreciation to the Central Bank of Bahrain, the Ministry of Industry and Commerce and all the other regulatory bodies for their continuous guidance and support of the efforts and initiatives of the banking sector in the Kingdom”, he added.
The three banks, Capivest, Elaf Bank and Capital Management House were advised by Kuwait Finance House-Bahrain as the Transaction Advisor, Trowers & Hamlins as legal counsel and Deloitte as independent valuer.