Shareholders of Oman International Bank (OIB) have approved a proposed merger with HSBC Oman, the local branch of the UK lender.

Under the terms of the deal, HSBC will inject $97.4m into its subsidiary prior to the merger. HSBC will be issued with new shares equivalent to 51 per cent shareholding in the combined entity.

The OIB board made the decision in an extraordinary general meeting (EGM) held on 9 May. The merger is subject to regulatory approval and is expected to be completed by 3 June.

“The merger is expected to be transformational for OIB and is anticipated to bring significant potential benefits to customers, shareholders and wider stakeholders in Oman,” says Ali Juma, chairman of OIB.

OIB will continue to be listed on the Muscat Securities Market (MSM) but will be renamed HSBC Bank Oman SAOG.

UK-based consulting firm PricewaterhouseCoopers (PWC) and law firm Trowers & Hamlin acted as advisors on the merger.