DFG Sells 30.5% Stake In Malaysia’s Bank Islam

The sale transaction worth $550 million concluded on July 31.

Dubai Financial Group (DFG) announced that it has sold its 30.5 per cent stake in Malaysia’s Bank Islam to BIMB Holdings. The sales transaction was worth $550 million and concluded on July 31.

DFG, a subsidiary of Dubai Group, had acquired a 40 per cent stake in Bank Islam for a value of $224 million in October 2006. The shareholding was reduced to 30.5 per cent in 2009, owing to DFG’s non-participation in the capital increase exercise undertaken by the bank at that time.

“The sale of our stake in Bank Islam stems from a strategic plan to support broader ongoing restructuring process by selling assets at the right value. We are pleased that we achieved solid return on our investment,” said Fadel Al-Ali, CEO of Dubai Group.

Bank Islam is currently the largest standalone Sharia’h based bank in Malaysia and South East Asia in terms of asset size.

The total assets of Bank Islam grew from $4.5 billion in 2006 at the time of DFG’s acquisition to $11.5 billion by the end of 2012 with continuous profitability.

“Since our investment, Bank Islam has grown in scale and size, and is a pioneer inretail Islamic banking in Malaysia today,” Al-Ali said.

“We are pleased that we achieved solid return on our investment.”