These new initiatives come on the back of a solid domestic performance. The bank has posted net profits of RO 12 million ($31.2 million) for the first half of the year, a 42.8 per cent increase on the corresponding period last year. The rise in profits came despite a 38.7 per cent increase in provisions to RO 7.5 million ($19.2 million). Analysts say the results confirm that BankMuscat is back on course for growth following a series of large corporate defaults that hit the Omani banking sector hard last year.

‘The Omani economy is performing very well at present and this is reflected in our balance sheet,’ says Sunder George, deputy chief executive. ‘Interest rates are down but we have still maintained a good yield on loan income.’

Net interest income grew by 27.6 per cent to RO 28 million ($72.8 million). Customer deposits were up 12.7 per cent to RO 1,030 million ($2,641 million).

George says BankMuscat is looking to get into the UAE market through a merger or acquisition. Its first move into the wider GCC market came at the end of 2001 when it acquired the offshore banking arm of ABN AMROin Bahrain. This was followed in May 2002 with a listing of BankMuscat shares on the Bahrain Stock Exchange.

‘We want to have a louder voice outside Oman. Our strategy is to be classed as a regional and not just Omani bank,’ says George.

The bank is also looking beyond the region at opportunities in the Indian subcontinent. Following changes this year to the Indian banking law enabling foreign banks to open local branches, BankMuscat plans to expand its business beyond its satellite branch in Bangalore. ‘We have been looking at India for some time and plan to convert our local subsidiary into a fully fledged Indian bank this year,’ says George.