IFC partners BankMuscat of Oman: Single largest investment in Middle East and North Africa by IFC

This will be IFC's largest investment in the Middle East and North Africa region.

The transaction, signed by Mr. Michael Essex, director of IFC's Middle East and North Africa Department, and Sheikh AbdulMalik bin Abdullah Al Khalili, chairman of BankMuscat, reaffirms IFC's commitment to foster the development of a viable housing finance market in Oman, and in other countries of the Gulf Cooperation Council. The deal is also in line with IFC's strategy to help GCC economies become less dependent on oil-related revenues. In addition to the loan, IFC is providing technical assistance to help BankMuscat grow its small and medium enterprise (SME) business.

At the signing ceremony in Oman, IFC's Mr. Essex, said, "There is a great demand for affordable, quality housing in Oman, especially for the middle-income group. IFC's long-term funding will help address this need."

Mr. Essex added, "IFC technical assistance will help BankMuscat develop financial products and services for smaller businesses, which typically have difficulty obtaining loans. As the private sector in Oman expands, this sector will become an important engine for job creation."

BankMuscat's Sheikh AbdulMalik bin Abdullah Al Khalili said:

"Today is an extremely important day for us, as we have not only been able to win over, but also sign a seal of confidence -- in BankMuscat -- with an organization as distinguished as the International Finance Corporation, the private sector arm of the World Bank."

"We are indeed privileged to have IFC as our partner for both the mortgage finance and SME finance sectors. World over, a vibrant small-scale sector and strong demand for housing and real estate have proven to be vital growth engines for developing economies such as ours. With Oman rapidly integrating into the global economy, under the visionary leadership of His Majesty, Sultan Qaboos bin Said, we expect the same to happen in Oman as well."

BankMuscat has had a substantial presence in the SME funding sector in Oman for several years. In 2005, it launched a program-lending suite of products, tailored to the sector, under the 'Al Wathbah' brand name. The bank has also recently repackaged and re-launched housing loan offerings in the light of the growing demand for such products in Oman, that is widely considered to be on a significant, though measured, growth path. 'baituna', as the suite of mortgage finance products have been named, have received significant response from customers nationwide since its launch.

Speaking about the significance of this agreement, Sheikh AbdulMalik added: "We are especially honoured, as this deal, the first with BankMuscat, is the single largest investment made by IFC in the MENA region today. We are sure Oman shall follow this trend and this, will only be the start of a long and mutually beneficial relationship between our two organizations."

This is IFC's first transaction with BankMuscat. Mr. Jyrki Koskelo, director of IFC's Global Financial Markets Department, noted that the investment marks a beginning of IFC's relationship with a reputable bank that could become a valuable partner in IFC's initiatives in the Middle East and North Africa region.