The MSM30 Index closed the week marginally higher by 0.06 per cent. The turnover and volumes were lower than last week by 37.6 per cent and 36.7 per cent, respectively. Local investors were net buyers while foreigners were net sellers.
All the sub-indices closed lower. Industrial and Service index was down by 0.15 per cent while the Financial Index was down by 0.06 per cent. Shariah index also closed lower by 0.02 per cent during the week.
The Board of directors of Ominvest resolved to sell a stake of 11.76 per cent of Oman Arab Bank to Arab Bank PLC at 1.3x of OAB new book value at the cut-off date of 31 March 2020. All-inclusive the sale consideration amounts to RO 46mn. The transaction is subject to the proposed acquisition of Alizz Islamic Bank by Oman Arab Bank and the related execution of the combination agreement. The shareholders of OAB in their extraordinary general meeting held on 15 June 2020 approved the acquisition of AIB and subsequent to that, both the banks have executed the combination agreement. On completion of the acquisition, Arab Bank PLC will continue to hold 49 per cent of Oman Arab Bank while Ominvest shareholding in Oman Arab Bank will reduce to 31.64 per cent from 51 per cent resulting in loss of control over Oman Arab Bank. Ominvest will reclassify its investment in Oman Arab Bank from subsidiary to an associate.
Ubhar Capital acquired 100 per cent stake in Gulf Baader Capital Market (100 per cent subsidiary of Gulf Investment Services Holding) for an amount of RO 2.136mn. Acquisition of the Gulf Baader Capital Market will position Ubhar Capital as one of the biggest investment companies of Oman with combined asset under management of $1.3bn and a combined brokerage market share of 37.86 per cent as of May 2020.
Shareholders of Oman’s Taageer Finance Company have approved the issuance of up to RO 10mn ($25.97mn) unsecured and unconvertible secondary bonds. The issuance of secondary bonds is with a greenshoe option for an amount up to RO 5mn and by way of a private placement at the nominal value of one Omani riyal for each bond.
Oman Ceramic reported a net loss of RO 160.7k compared to loss of RO 199k in 1Q19. Revenue during the period was lower by 13 per cent to RO 0.55mn compared to RO 0.63mn in 1Q19. Expenses dropped by 14.5 per cent to RO 0.71mn in 1Q20.
Oman education sector reported revenue of RO 14.8mn, lower by 2 per cent. Within the sector revenue of OETI went up by 2 per cent while that of Majan college dropped by 9 percent. Profit on the other hand was up by 25 per cent for the sector at RO 1.57mn compared to RO 1.25mn in 9M19. The higher profit was largely because of growth in income of Oman Education Training and Investment (OETI). OETI income grew by 522 per cent during the period while the same of Majan College was down during the period by 6 per cent. Better profitability of OETI over Majan college was because of lower expenses and consequently better margins.
Conventional credit growth has dropped to 2.2 per cent YoY in April as compared to 2.7 per cent YoY in Mar’20. Total conventional credit reached RO 22.32bn (-RO 20mn on MoM basis or -0.1 per cent MoM; +2.2 per centYoY). Conventional deposit growth also dropped to 2.9 per cent YoY in Apr’20 as compared to 4.1 per cent YoY in Mar’20. Sector Loan-to-deposit (LTD) ratio increased to 109.3 per cent vs. 108.5 per cent in Mar’20. Conventional credit contracted largely on account of a 0.4 per cent MoM contraction in private sector credit, which forms about 86 per cent of the total. Furthermore, credit to Government and non-residents also declined by about 4 per cent each.
Total conventional deposits stood at RO 20.42bn (-RO 177mn on MoM basis or -0.9 per cent MoM; +2.9 per cent YoY). Conventional deposits fell largely on account of a 6 per cent MoM (RO 392mn) and 9.7 per cent YoY decline in Government & public enterprises’ deposits. The share of Government & Public Enterprises deposits has dropped to 30 per cent from an average of 32.9 per cent over the previous 12 months. Private sector deposits, which account for about 68 per cent of total conventional deposits, grew by 1.5 per cent MoM and 9.6 per cent YoY.