FIMBank has completed the first stage of a multi-step process which has seen Burgan Bank and United Gulf Bank (UGB), members of the Kipco Group, acquiring 37.05 per cent of shareholding in the bank. At the end of this process, these two major Middle Eastern banks will have acquired a controlling interest in FIMBank. As part of this process, FIMBank also received from UGB the first tranche of a convertible loan of $60 million.
This development effectively means that Malta-based FIMBank now forms part of the Kipco Group, one of the largest diversified holding companies in the Middle East and North Africa, with consolidated assets of $26 billion. The group has significant ownership interests in a portfolio of over 60 companies operating across 24 countries, with commercial interests ranging from financial services, media, real estate and manufacturing. Through its core companies, subsidiaries and affiliates, Kipco also has interests in the education and medical sectors.
FIMBank chairman John Grech stated: “This is an historic milestone for FIMBank for various reasons, not least because it will increase the FIMBank Group’s capability and provide it with the potential to compete with the leaders in our market.
“For Malta the Kipco connection means increased visibility for its financial sector and a boost to Malta’s potential to attract new investments and develop new financial products, which will lead to more financial sector jobs and a further strengthening of the local banking sector.”
FIMBank Group president Margrith Lütschg-Emmenegger stressed the positive effects for FIMBank as a result of its being part of the Kipco Group: “This development will allow FIMBank to overcome current challenges to its future growth, particularly through a stronger balance sheet, greater acceptance from correspondent banks and access to interesting new markets, products and clients. This development also bodes well for increased profitability, among others as a result of substantially lower funding costs, and enhanced returns for all shareholders.
“Finally, access to more funding will support further the implementation of the successful business model we have been implementing.”