Oman's Sohar International Bank (BKSB.OM), opens new tab said on Monday it plans to explore a merger with smaller rival Ahli Bank SAOG (ABOB.OM), opens new tab, in a potential deal that would create a lender with around 11.1 billion Omani rials ($28.84 billion) in assets.
Sohar International’s board has resolved to send a letter of intent to Ahli’s board to explore a potential merger between the two banks, the lender said in a statement.
Ahli did not immediately respond to a request for comment on the matter.
The proposed deal comes amid a wave of consolidation in the Gulf’s banking sector, as lenders seek to boost scale, cut costs, and remain competitive in a crowded market.
In Oman, several smaller banks have explored tie-ups in recent years to navigate tighter margins, rising compliance costs, and economic shifts linked to energy transition efforts.
Last year, Sohar International completed a merger with HSBC Bank Oman. Ahli Bank also fielded interest from domestic rival Bank Dhofar for a possible merger in 2023.
"Shareholders of Ahli Bank will receive a share consideration in Sohar International," it said in the letter, adding that the bank will take over all assets and liabilities of Ahli Bank after the merger closes.
Sohar International held total assets worth 7.36 billion Omani rials ($19.12 billion) as of Dec. 31, while Ahli Bank reported assets of more than 3.7 billion Omani rials.
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