BMA grants three new banking licences, approves one other

The new licences were recently approved by HH Shaikh Khalifa Bin Salman Al Khalifa, Prime Minister of the Kingdom of Bahrain and Chairman of the BMA Board.

"An offshore banking unit (OBU) licence has been granted to ICICI Bank, India's second largest bank. The BMA is also extending a special concession to ICICI Bank to offer its non-resident Indian (NRI) banking services in Bahrain as well as to the international market", said Mr. Ahmed Abdul Aziz Al Bassam, Director, Licensing & Policy, at the BMA.

ICICI Bank is a commercial bank and it is the largest private bank in India, with assets of US$22 billion. The bank has a network of 550 branches in India, in addition to overseas operations in Canada, USA, UK, China and Singapore.

The BMA has also granted a licence to Saudi Arabia's Saad Group of Companies to establish a Bahrain-incorporated OBU. Awal Bank is being set up with a paid up capital of US$200 million. It will offer investment services to high net worth individuals, as well as other financial services.
"Awal Bank will become the hub for the Saad Group's global investment and financial activities, which are currently carried out from Europe", said Mr. Al Bassam.

The Saad Group is among the top 10 business groups in Saudi Arabia, with activities spanning construction, real estate, medical services and investments.

The Group has had a presence in Bahrain since 1984 with Saad Investment EC, an investment firm serving the parent company. The majority shareholder of Saad Investment is leading Saudi investor Maan Al Sanea.

A licence has also been granted for the establishment of Unicorn Investment Bank, an Islamic investment bank. The bank, which will have an initial paid up capital of US$120 million, is being set up by a group of investors from Saudi Arabia and Kuwait, led by Kuwaiti banker Mr. Majed Al Rifai, a founder of Bahrain-based First Islamic Investment Bank.

Unicorn bank's activities will include financing, asset management, leasing and investment services for a client base in the Middle East region, Malaysia, UK and USA. It will also offer financial advisory services, particularly in the area of privatization and issuance of Islamic bonds (sukuk).

In addition, the BMA has approved, in principle, a restricted full commercial bank licence for State Bank of India (SBI), which will enable the bank to offer NRI services and certain retail services, such as mutual funds and capital market services, in Bahrain.

The new licence will be in addition to the bank's existing OBU, which was established in Bahrain 1978. Once the new licence is granted, Bahrain will become the hub for SBI's operations throughout the Middle East.

SBI is India's largest bank with assets of about US$99 billion. The bank has over 9,000 branches in India, in addition to operations in 30 other countries.

"Bahrain continues to attract foreign, regional and local institutions and investors," Mr. Al Bassam pointed out. "It is a demonstration of the excellent reputation the Kingdom enjoys as the foremost international financial center in the Middle East region."

With the granting of the new licences, the total number of financial institutions regulated by the BMA will increase to 362, of which 186 are banks and banking-related institutions, 163 insurance and insurance-related firms and 13 capital market brokers.