Manama: The creation of a planned Islamic investment megabank is in "fairly advanced stages" and it will likely be launched in the next six to 12 months, an executive at a firm advising on the project said yesterday.
A plan to form the world's largest Sharia-compliant lender — which is being promoted by the chairman of Al Baraka Banking Group, Shaikh Saleh Abdullah Kamel — has been in the works for some years.
Kamel said last April that the global financial crisis had delayed the project but had at the time expressed hope of launching the bank by the fourth quarter of 2009.
"The key shareholders I would say are on board and we are looking for an imminent launch, within six months to a year," Sameer Abdi, head of Islamic finance at Ernst & Young, told the Reuters Islamic Banking and Finance Summit in Bahrain.
Shareholders
Kamel said in April that the new institution had drawn 10 shareholders, including the Islamic Development Bank, Saudi Investment bank and the Kuwait Real Estate Bank.
Bigger Islamic banks are widely seen as crucial for the industry to realise its growth potential and to compete with Islamic windows or subsidiaries of Western conventional banks that have large market shares in wholesale banking services.
Abdi said the bank's "capital aspirations" were between $3 billion (Dh11 billion) and $4 billion.
"It's progressing very, very quickly, even in such tough market conditions," Abdi said.
Conventional banks, regional as well as international, would likely play a role in the project, but their exact role had yet to be decided.
Likely jurisdictions
"Possibly as shareholders, possibly as technical consultants, possibly as operators ... all those options are being explored," Abdi said.
Possible jurisdictions to host the bank include Malaysia and Bahrain, with a third being considered, he said.
