(MENAFN- Muscat Daily) Muscat- After seven months of talks, the proposed merger plan between National Bank of Oman (NBO) and BankDhofar has been called off as both banks have mutually agreed to end merger discussions.
The two financial institutions announced that they have decided to discontinue the merger discussions after the parties could not agree on terms for the possible merger transaction, according to disclosures filed to the Muscat Securities Market by NBO and BankDhofar on Thursday. However, the banks announced their decision without offering details on issues that have caused the merger talks to fail.
In July 2018, BankDhofar and NBO had announced their plan to begin talks on a possible merger between the two lenders. The proposed merger would have formed the second largest bank in Oman, which would have an asset and loan market share of 25 per cent, compared to 36 per cent for Bank Muscat, a research note from EFG-Hermes had said in July last year.
In December, NBO's largest shareholder, Commercial Bank of Qatar, had advised the bank that Commercial Bank does not support the proposed merger between NBO and BankDhofar. Commercial Bank holds 34.9 per cent of shares in NBO, according to NBO's latest financial statements.
This was the second attempt for BankDhofar to merge with a domestic bank after protracted negotiations with Bank Sohar (now rebranded as Sohar International), which lasted over three years. In October 2016, BankDhofar had decided to call off its proposed merger with Bank Sohar as the two banks had been unable to reach an agreement on certain key issues.
In August 2018, the Capital Market Authority had requested BankDhofar and NBO to complete the negotiation process and make a final decision on the proposed merger plan within a period not exceeding six months from the announcement of first disclosure.
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