LAHORE (May 22 2007): The Extraordinary General Meeting of AIBaraka Islamic Bank, Bahrain, a subsidiary of AlBaraka Banking Group (ABG) approved increasing the authorised capital of the Bank to US $600 million, divided into 6m shares of US $100 each.

The Extraordinary General Meeting of the Bank also approved the resolution of the Board of Directors to merge Al Amin Bank, a subsidiary of ABG, with AlBaraka Islamic Bank and the acquisition of the assets and liabilities of Al Amin Bank in accordance with the clauses of the draft purchase agreement presented before the Meeting here on Monday.

Al-Baraka Islamic Bank was established and licensed on 21 February 1984 to operate from Bahrain as an Offshore Banking Unit (OBU) in accordance with a license issued by Bahrain Monetary Agency. The bank has a paid-up capital of US $50 million, divided into half a million shares of US $100 each.

As for Al Amin Bank, it was established in 1987 under the name "Al-Amin Company for Securities and Investment Funds (E.C)". The Company began to operate as an Islamic investment bank since May 2001 after obtaining a bank license from the Central Bank of Bahrain.

The merger of the two banks is hoped to result in the creation of an Islamic banking institution that combines commercial banking services, which are now being offered to individuals and corporate clients by AlBaraka Islamic Bank, with the investment banking services of Al Amin Bank.

Because the two banks have more than two decades of experience in banking, offer a wide range of products and services and occupy leading positions in the market, the merger will, no doubt, result in the emergence of a new robust institution that possesses all the elements of success and competitiveness in terms of size, efficiency, expertise or services offered.

A preliminary study reveals that the merger will result in the creation of a major Islamic banking institution with assets of more than US $925 million and equity of about US $185 million. This in turn will put it in the top of the list of Islamic banking institutions operating in the Kingdom of Bahrain. The newly formed institution intends to offer some of its shares for public subscription and list them on Bahrain Stock Exchange, considering that AlBaraka Islamic Bank is a commercial Islamic bank that offers all commercial banking services to the public in Bahrain.

On this occasion, Chairman of Albaraka Banking Group Sheikh Saleh Kamel said that the merger of these two well established banks, which are subsidiaries of Al Baraka Banking Group, was a realisation of an old dream.

Sheikh Kamel is a strong believer in mergers among Islamic banking institutions, because merger consolidates their potential for development and improves their competitiveness

On his part, Mahmood Jameel Hassouba, Chairman of the Board of Directors of AlBaraka Islamic Bank and Al Amin Bank said that AlBaraka Bank was considered a pioneer in Bahrain and its operations and activities covered Saudi Arabia, the UAE and other Gulf countries, in addition to Pakistan. The Bank has a large base of clients who wanted to conduct their investment and financial dealings in accordance with the principles of Islamic Sharia. Al Amin Bank has in the recent years implemented many strategic initiatives that contributed effectively to consolidating the notable position it occupies at present.