Saudi Arabia’s National Commercial Bank (NCB) said that more than two-thirds of its business is already Shariah-compliant, adding that it plans to become a completely Islamic bank “within a reasonable time,” according to Arab News.
The NCB statement came amid the bank’s plans to sell shares on the Saudi stock market. NCB, the only unlisted lender among the Kingdom’s 12 local banks, will issue 25% of capital or 500 million shares in an initial public offering (IPO) as of October 19.
The subscription will run for two weeks until Sunday, November 2 at SAR 45 per share. The bank earlier said it appointed HSBC Holdings and Gulf International Bank as financial advisers for the sale.
The bank’s total assets reached SAR 377 billion at the end of 2013. NCB was also the most profitable bank in Saudi Arabia last year, according to data compiled by Bloomberg.
Chairman Mansour Al-Maiman said the NCB, which holds a leading position in offering distinguished financial services, has clear strategies for the next years.
This IPO, which is considered the largest in the Kingdom’s history, aims to complete the listing of all local banks on the Saudi bourse.
This move is also expected to play a major role in the national economy and boost investor confidence in the Saudi stock market.
Mohammed Al-Omran, a financial analyst and president of the Gulf Center for Financial Consultancy in Riyadh, said the pricing of SAR 45 per share came below expectations, as analysts expected it to be between SAR 50 and SAR 60.
Al-Omran added that this means a big boost for the IPO and the market as the pricing represents positive news for the Saudi public.
Mohammad Al-Tuwaijri, chief executive of HSBC Middle East & North Africa, said the opening up of the Saudi bourse is likely to lure nearly SAR 30 billion foreign liquidity, noting that this was ‘a long-awaited decision”.
He expected the NCB’s IPO to see a strong coverage ratio, compared to the other issues in the region and in which HSBC participated, such as Emaar which was 30 times subscribed. The Kingdom’s largest bank by assets focuses its operations on Saudi Arabia, the UAE and Egypt which represent nearly 80% of its regional operations, Al-Tuwaijri said.
However, the General Presidency of Scholarly Research and Ifta, headed by Saudi Grand Mufti Abdul-Azeez Aal ash-Shaikh, declared the participation in the NCB subscription as unlawful, as well as the offerings of other banks, companies and institutions which give and take interests in their dealings.
The NCB statement came amid the bank’s plans to sell shares on the Saudi stock market. NCB, the only unlisted lender among the Kingdom’s 12 local banks, will issue 25% of capital or 500 million shares in an initial public offering (IPO) as of October 19.
The subscription will run for two weeks until Sunday, November 2 at SAR 45 per share. The bank earlier said it appointed HSBC Holdings and Gulf International Bank as financial advisers for the sale.
The bank’s total assets reached SAR 377 billion at the end of 2013. NCB was also the most profitable bank in Saudi Arabia last year, according to data compiled by Bloomberg.
Chairman Mansour Al-Maiman said the NCB, which holds a leading position in offering distinguished financial services, has clear strategies for the next years.
This IPO, which is considered the largest in the Kingdom’s history, aims to complete the listing of all local banks on the Saudi bourse.
This move is also expected to play a major role in the national economy and boost investor confidence in the Saudi stock market.
Mohammed Al-Omran, a financial analyst and president of the Gulf Center for Financial Consultancy in Riyadh, said the pricing of SAR 45 per share came below expectations, as analysts expected it to be between SAR 50 and SAR 60.
Al-Omran added that this means a big boost for the IPO and the market as the pricing represents positive news for the Saudi public.
Mohammad Al-Tuwaijri, chief executive of HSBC Middle East & North Africa, said the opening up of the Saudi bourse is likely to lure nearly SAR 30 billion foreign liquidity, noting that this was ‘a long-awaited decision”.
He expected the NCB’s IPO to see a strong coverage ratio, compared to the other issues in the region and in which HSBC participated, such as Emaar which was 30 times subscribed. The Kingdom’s largest bank by assets focuses its operations on Saudi Arabia, the UAE and Egypt which represent nearly 80% of its regional operations, Al-Tuwaijri said.
However, the General Presidency of Scholarly Research and Ifta, headed by Saudi Grand Mufti Abdul-Azeez Aal ash-Shaikh, declared the participation in the NCB subscription as unlawful, as well as the offerings of other banks, companies and institutions which give and take interests in their dealings.
Source:
Mubasher
