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KFH expects board to decide on AUB merger before year-end, says CEO

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Thursday 08, November 2018 BY KUDAKWASHE MUZORIWA

The duo has been in talks since the first half this year on a potential merger that would create one of the largest Islamic banks in the Gulf.

The Chief Executive of Kuwait Finance House (KFH) said that the board will likely decide on whether to go ahead with a merger with Bahrain’s Ahli United Bank (AUB) before the end of the year.

Mazin Saad al-Nahedh, the Chief Executive of KFH, said that the bank is still waiting for the board’s decision.

KFH’s international business generates around 41 per cent of its operating income, with Turkey contributing 35 per cent to the lender’s international business portfolio in Q3 2018.

Kuwait’s largest Islamic bank will consider further international expansion when a merger is completed, which includes potential acquisitions and seeking a licence to operate a representative office or branch in China.

Until a merger decision is made, KFH will hold off on plans to issue a benchmark-sized Sukuk of between $500 million to $750 million, added Al-Nahedh.

The trend of bank mergers in the Gulf have increased in the past two or three years after more moderate levels of oil prices hit state revenue, pushed up bad loans and squeezed bank profit margins, reported Reuters.

TAGS : KFH, Gulf Bank Merger, AUB

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