The new licences were approved this month by HH Shaikh Khalifa Bin Salman Al Khalifa, Prime Minister of the Kingdom of Bahrain and Chairman of the BMA Board.
An investment banking licence has been issued to Saudi Arabia-based Arab Petroleum Investments Corporation (APICORP). The new entity, which will be an arm of APICORP will participate in taking equity positions and providing debt financing to the petroleum industry. The prime objective of the bank will be to support the financing of the oil, gas and petrochemical industries in Arab countries on a commercial basis.
APICORP, which is owned by the governments of 10 members of the Organisation of Arab Petroleum Exporting Countries (OAPEC), including Bahrain, has a paid up capital of US$550 million, while total assets stood at US$2.1 billion at 2004-end.
The BMA has also granted a full commercial bank (FCB) licence to Mashreqbank.
Dubai-based Mashreqbank is a public shareholding company listed on the Dubai Financial Market. It is one of the largest banks in the UAE with 34 branches, in addition to an offshore banking unit in Bahrain. Total assets stood at US$8.7 billion at 2004-end.
The Bahrain FCB would target mainly corporate customers, including Bahrain-based corporates with a strong presence in the UAE and Qatar, mid-sized local businesses and local and international contractors engaged in infrastructure projects.
The BMA has also approved a full commercial bank (FCB) licence for the State Bank of India (SBI), in addition to the bank’s existing offshore banking unit, which was established in Bahrain in 1978.
SBI is India’s largest bank with assets of about US$126 billion. The bank has over 9,000 branches in India, in addition to operations in 30 other countries.
A licence has also been granted to Liechtenstein-based LGT Bank to establish a Representative Office in Bahrain.
LGT Bank is the largest private bank in Liechtenstein. It is a member of Liechtenstein Global Trust, whose majority shareholder is the Liechtenstein Royal House.
The Bahrain office of the bank will be its first in the Middle East. Outside Europe, the bank currently has a presence in Asia and Latin America.
The BMA has also granted an offshore banking unit (OBU) branch licence to Bank Al-Habib Limited (BAHL) of Pakistan.
The Bahrain branch of BAHL will undertake trade and corporate finance, treasury and investments activity and inter-bank transactions.
The Middle East region continues to offer tremendous growth prospects for financial services providers, particularly in the areas of asset management, private banking, life and medical insurance, securitisation, Islamic banking and insurance, third part administration (TPA) services, leasing and investment services, said Mr. Ahmed Abdul Aziz Al Bassam, Director, Licensing & Policy, at the BMA.
“The BMA remains committed to supporting the financial services community to enable it to capitalize on the tremendous opportunities opening up in the wider Middle East region,” he said.
The BMA continues to work on a number of market development issues, including a new licensing framework, which will provide additional flexibility to financial institutions wishing to do business in and from Bahrain. The new licensing framework is expected to come into effect by the end of 2005.
“We welcome the continued interest from financial institutions and groups in doing business from Bahrain,” said Mr. Al Bassam. “It is a demonstration of the excellent reputation the Kingdom enjoys as an international financial center.”
The BMA is processing a number of other applications from leading international and regional financial institutions.
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