29 Jun 2014
MANAMA, BAHRAIN – 28 June 2014 – Ithmaar Bank, a Bahrain-based Islamic retail bank, has issued an investor report on its Shamil Bosphorus Modaraba (SBM), indicating the fund will not achieve its investment objectives and stating that there is also a low probability that investors will have their entire capital returned. As Modareb, the Bank will be contacting investors to discuss the investor report and to explain available options.
The SBM is a US$90 million investment fund opened in November 2007 that provided equity for the acquisition, development and sale of a diversified pool of assets that included land, property and development sites in Turkey.
During 2013, the Bank attempted to negotiate an exit from Turkey with its Turkish partners and more recently it has been conducting enquiries through its appointed advisers and consultants.
“The report issued to investors relays information the Bank has gathered to date and the Bank is very concerned by what it has recently learned as a result of the enquiries undertaken by its advisers and consultants,” said Ithmaar Bank General Manager, Retail and Private Banking, Abdulhakeem Al Mutawa.
“Ithmaar Bank has engaged the services of various advisers and consultants at its own expense, including Dechert LLP (UK) and Hassan Radhi and Associates (Bahrain), to determine the reasons for the SBM not achieving its investment objectives.
“The Bank’s advisers and consultants are also reviewing the status of the financial position of the fund’s assets and liabilities in order to determine the value of the SBM and available recourse.”
“As Modareb, Ithmaar Bank continues to operate in the best interests of all the SBM investors and will meet with investors to explain the report and available options,” he added.