Oman’s largest bank, BankMuscat, and the second largest bank, National Bank of Oman, have agreed a merger in a move that will greatly strengthen BankMuscat’s operations both at home and abroad. The merger follows NBO’s $130m loss in 2003 and a number of senior management changes in recent months. The effective date of the merger is expected to be 1 January 2005, subject to receiving regulatory approvals. NBO’s net worth as of the end of December 2004 has been put at RO100m ($256m)
The complex all-paper deal allows BankMuscat to pursue its overall growth strategy and with NBO gives it a comprehensive 52% market share in Oman and a combined $6bn balance sheet.
Earlier this year, BankMuscat acquired a strategic 26% stake in India’s Centurion Bank. On a regional basis, the merger will allow BankMuscat to make its long-awaited entry into the UAE market through NBO’s operations in Abu Dhabi, and also gives it operations in Egypt.
“With the added strength that would result from the merger, BankMuscat will be comparable in size to many GCC banks and will be far better equipped to provide greater value to our customers, investors and other stakeholders, as a result of its larger customer base,” adds BankMuscat chairman Sheikh AbdulMalik bin Abdullah Al Khalili.
