The Central Bank of Oman (CBO) has given ‘in principle' approval to the proposed merger of Oman International Bank (OIB) and HSBC Middle East's branches in the country. In a statement, CBO said it had given the approval on the basis that it does not contradict with the concerned laws in Oman.' The two banks had announced their intention to merge in October last year, with OIB chairman Dr Juma Ali Juma al Juma saying in a statement to the Muscat Securities Market (MSM) on October 7 that “If negotiations proceed to an agreement, it will lead to a merger. OIB is Oman's fifth largest bank by assets and HSBC the sixth largest. Combined, they would have the scale to be a leading player in the fast-growing Omani banking market." Anil Kumar, vice president of research at Fincorp, told Muscat Daily that the merger would help OIB improve its deposit and loan growth. He said, “This partnership with HSBC will probably bring managerial skills which are required to help OIB attain higher scales of business, with more deposits and more loans. Kumar added that consolidation would have been 'inevitable,' given the size and increasing competitiveness of the Oman market. Analysts also predicted that a merger between OIB and HSBC Middle East's Oman branches would create the 'third-largest' bank in Oman.
