Kuwait Financial House (KFH Group) has divested an 18.18 per cent stake in Sharjah Islamic Bank for $351M (AED 1.3B), the banking group announced on Tuesday.
KFH disclosed in a stock exchange filing that the shares were sold to the Endowment of Sheikh Sultan bin Mohammed bin Saqer Al Qasimi, the Sharjah Social Security Fund, and Sharjah Islamic Bank.
The Kuwaiti bank sold 588 million shares at a price of Dhs2.20 each.
The Sharia-compliant bank stated that the “off-market sale and transfer of shares” is subject to obtaining “regulatory approvals.”
The banking group’s profit for the first half of the year saw a modest increase of 2.3 per cent, reaching $1.1B (KWD341.2M), compared to KWD333.4M in the same period the previous year. KFH’s total assets dropped by 4.2 per cent to KWD36.4B from KWD38B in H1 2023.
KFH has been concentrating on strengthening its position and expanding in the GCC and broader regional markets.
In June, the bank mentioned that it was “conducting thorough studies” for potential expansion opportunities into Saudi Arabia, following reports that it was considering acquiring a majority stake in Saudi Investment Bank. The bank stated that exploring the potential acquisition of a stake in the Saudi Investment Bank, along with other studies for regional expansion, “supports KFH’s growth.”
“The recent rise in mergers and acquisitions among Kuwaiti banks is credit positive for the sector, particularly given the market is overbanked,” Fitch Ratings commented in August.
Boubyan Bank, Kuwait’s second-largest Islamic bank, and Gulf Bank, the country’s fifth-largest bank overall, announced in July that they are considering a potential merger.
