Dubai: Shareholders in Bahrain’s Ithmaar Holding sure seems to be in approval of the restructuring plans, despite accumulated losses at the $790 million mark. Because the stock was up 14.67 per cent on Monday (August 29) to Dh0.21.
Clearly, what the management had to say about clearing most of the losses must have geed up shareholders. “The Board of Directors is working on various initiatives to improve the capital, which will strengthen the company’s consolidated equity, including cancellation of accumulated losses against share capital,” Ithmaar Holding said in a statement. Other possibilities include ‘sale and/or restructuring of non-core assets…”
The losses represent 104 per cent of capital, and was brought on by the pandemic ($87 million), and before that because of higher impairments.
Ithmaar Holding, an investment firm, is listed on Bahrain Bourse and Dubai Financial Market. It owns two wholly-owned subsidiaries - Ithmaar Bank, an Islamic bank subsidiary which holds the core corporate banking business, and IB Capital, an investment firm subsidiary, which holds investments and other non-core assets.
Plan of action
In March, Ithmaar Holding shareholders approved plans to sell some of the Company’s key assets in Bahrain to Al Salam Bank. These include an ownership stake in BBK and Solidarity Group Holding, the Takaful entity and the parent of Solidarity. Also disposed would be the consumer banking business of Ithmaar Bank. The transaction has been completed.
“Ithmaar Holding now retains a well-diversified portfolio of international and local financial and other assets, which include banking businesses in Bahrain and Pakistan,” the statement said. “Ithmaar Bank, which remains a wholly-owned subsidiary of Ithmaar Holding, will continue as an Islamic bank that is licensed and regulated by the CBB and exclusively focused on corporate banking and related services, particularly the fast- growing SME.”
Marginal gains in H1-2022
Ithmaar Holding had a net profit of $18.13 million for H1-2022 against $12.96 million in 2021, mainly due to increase in core income.