Bankmuscat Receives Over Ro 175 Million In Subscription
For The First Gcc 10-Year Corporate Bond

BankMuscat (S.A.O.G) has received an overwhelming response for its 7% fixed rate bond. Total amount collected exceeded RO 175 million against an issue size of RO 15 million (with possibility to increase upto RO 25 million).

BankMuscat (S.A.O.G), the largest bank in Oman had launched the first issue of ten-year corporate bonds in the GCC on the 18th of May 2003. The bond carried a fixed coupon of 7% and a tenor of ten years. The issue was rated one notch below sovereign ratings by Moody's (Baa3) and Fitch (BBB) The bond will be listed on the Muscat Securities Market.

Commenting on the overwhelming response, Mr. Abdulrazak Ali Issa, Chief Executive of BankMuscat stated that, "The large response from both local and regional investors reflects the confidence in the Omani economy and the bank's reputation" Mr. Abdulrazak further added, "While we are overwhelmed by the response, we understand the responsibility on the bank to return about RO. 150 mn. of the investor's monies. We have spoken to the CMA on the matter and as usual have received strong support from them. We have already refunded the excess monies within four days of closing the issue which is earlier than the 15 days promised by us in the prospectus"

The bonds will be listed on the Muscat Securities Market (MSM) soon after the allotment procedures are finalized with the CMA. The Bank already has two of its bonds - subordinated loan notes and compulsorily convertible bonds - listed on the MSM, with active trading on both.

The bank's Chief Executive stated that "The bank has been working on extending the tenors of its liabilities over the last three years. It's also our objective to work with the Capital Market Authority and Central Bank Of Oman to develop the debt markets in the country. The bank would like to raise long term funding and use the monies to fund its long term assets including the project finance loans of long tenors."

The chief Executive concluded with saying "We would like to thank all investors who subscribed to this issue. We have received application across all types of investors and investors from all GCC countries, which shows the confidence these investors have in BankMuscat."

The Bank reported a net profit of RO 22.91 million for the year 2002. Maintaining its impressive performance during the first quarter of the year 2003, the Bank recorded a net profit of RO 6.4 million, a growth of 5% over the first quarter of 2002. The basis earnings per share on an annualized basis works out to 520 baizas for every one Rial share of the Bank.