Kuwait’s Investment Dar sells controlling stake in Bahrain Islamic Bank
Kuwait City, Kuwait (4E) – Kuwait-based Investment Dar Co. said that it has agreed to sell its stake in an unprofitable Bahraini bank for $92mn as the majority shareholder of British luxury carmaker Aston Martin seeks to restructure its debt.
The Social Insurance Organisation Asset Management Company (SIOAM) and National Bank of Bahrain (NBB) announced during the weekend that they were taking control of Bahrain Islamic Bank (BisB). Both companies have agreed with Investment Dar to buy its own as well as associated companies’ 51.6 per cent stake in BisB.
Investment Dar, which is among the many Kuwaiti companies that struggled to pay their financial obligations following the financial crisis, defaulted on a $100mn Islamic bond in 2009 and restructured around $5bn of debt in 2011. The restructuring is part of the Financial Stability Law, enacted by the Kuwaiti government in April 2009 to boost financial institutions hit by the credit crisis.
The decision by Investment Dar to sell its stake in the bank comes as many of the Middle East banks aim to merge and as the central bank promotes consolidation.
BisB has 833mn dinars ($2.2bn) of assets, but has recorded losses in each of the last four years. Last year, the bank has abandoned plans for a merger with Al-Salam Bank.