Kuwait – Mubasher: Kuwait Finance House (KFH) is currently negotiating to acquire Bahrain’s Ahli United Bank (AUB), a person familiar with the matter told Bloomberg on Monday.
If completed, the acquisition will result in one of the largest Islamic banks in the Middle East with around $85 billion in assets.
KFH is in talks to acquire the Bahraini lender as well as its Kuwaiti unit, AUB Kuwait, the person, who spoke on condition of anonymity told the news agency, highlighting that there is no guarantee that the deal will actually take place as no final agreements have been reached yet.
Last month, KFH reported a 13.2% profit increase KWD 38.59 million ($126.48 million) in the first quarter of 2017, compared to KWD 34.1 million ($111.77 million) in Q1-16. The rise came on the back of higher net financing revenues by 3% and a 19% rise in revenues from fees and commissioning.
Following the decline in oil prices over the past year and a half, a number of Gulf lenders have opted to merge their operations in order to compete better in the markets.
Last month, the UAE’s National Bank of Abu Dhabi (NBAD) and First Gulf Bank (FGB) announced a merger that created Abu Dhabi First Bank with $175 billion in assets.
Similarly, Qatar’s Masraf Al Rayan is reportedly looking to merge with Barwa Bank and the International Bank of Qatar. The three-way merger is said to result in forming Qatar’s largest Islamic lender.
By the end of March, KFH’s total assets amounted to $53.9 billion, while AUB’s reached $31.5 billion, data compiled by Bloomberg showed.
