The first issue will be offered to shareholders at the rate of one share for every 1.75 shares held. The pricing of the second issue will be determined in consultation with an international consultant. ‘Initially we wanted to stage a single rights issue and a separate strategic placement,’ says a TAIB official. ‘However, this fell foul of local legislation so we went for two rights issues and will privately place any unsubscribed shares.’
TAIB attributes the decision to concentrate on developing its private banking operations to the opportunities it offers and the lack of other local institutions focusing on the sector. ‘We have decided to become a private bank because the time is right for us to tap Bahrain’s standing as an attractive and progressive financial centre,’ said TAIB chief executive Iqbal Mamdani in a statement. ‘[TAIB] is one of the few local banks narrowly focused on offering one-stop wealth management services to high net worth and institutional investors, three quarters of whom have become disenchanted with the investment services of foreign banks.’
TAIB will target investors with holdings of $3 million-15 million. The bank plans to expand its product portfolio to offer mutual funds, hedge funds, real estate funds and Islamically-structured vehicles. In late October, TAIB launched two new Islamic equity funds (MEED 31:10:03). The bank will also aim at expanding its institutional client base through agreements with regional financial establishments to offer TAIB products.