Oman’s Bank Sohar and Bank Dhofar have each appointed advisors for a proposed merger, the banks said in stock market statements.

The financial and legal consultants will carry out due diligence.

The banks announced a non-binding memorandum of understanding in July 2015 on the proposed merger.

Bank Dhofar had assets of RO3.3bn ($8.7bn) as of the end of September 2015. Its net profit rose 10.1 per cent to RO33m in the third quarter of 2015.

Bank Sohar’s profits fell 10.4 per cent in the quarter three 2015 to RO21m, while its assets grew at 20.1 per cent year on year to reach RO2.2bn by the end of September.

Bank Dhofar is the third largest bank in Oman, but has struggled to grow its market share in a crowded market. It proposed a merger with Bank Sohar in 2013.