Bank Sohar raises $250m in term loan
The facility will be used for general funding purposes and to extend maturities of liabilities profile
MUSCAT: Bank Sohar successfully closed a $250 million threeyear syndicated term loan facility, in line with current strategies to maintain good credit capacity.
The facility will be used for general funding purposes and to extend maturities of liabilities profile. Acting as the sole bookrunner and coordinating bank is Bahrain-based Bank ABC.
Prior to general syndication, the Abu Dhabi Commercial Bank, Axis Bank Limited and Commerzbank Aktiengesellschaft had joined the facility as initial mandated lead arrangers. The facility was significantly oversubscribed, with a total of 13 banks participating from the Gulf Cooperation Council (GCC), Europe and Asia.
New opportunities
Commenting on this strategic association, Sasi Kumar, acting chief executive officer of Bank Sohar said, “As part of our strategy, to continue seeking new opportunities for growth and utilising our liquidity in the most efficient and effective manner, it gives us great pleasure to be one of the participating banks in this syndicated loan. The success of the syndication is evidence that the bank maintains good credit capacity, despite the local and regional market liquidity challenges. As one of the prominent banks within the country, we have also managed to successfully attract new investors to the loan facility.
Syndicated loans offer flexibility in structure and pricing. Borrowers have a variety of options in shaping their syndicated loan, including multi-currency options.
Bank Sohar has created a unique position for itself in the syndication market by having successfully closed significant and complete deals considered large in scale.
Taking forward the nation’s infrastructure funding requirement, Bank Sohar is committed towards the funding of an Independent Water Project in Oman and during the year 2016; the Bank has also participated in the tourism and healthcare related sector.
Commenting on participating in the facility, Saeed Ali Al Hinai, senior assistant general manager (Treasury), said: “The broad cross-section of banks that participated in the syndication reflects their deep confidence in Bank Sohar and its distinction of becoming Oman’s fourth largest bank in the relatively short span of 10 years, with the lowest levels of NPAs .The loan will help the Bank avoid liquidity risk in the medium term and improve liquidity levels, which is in line with the Bank’s current strategy of avoiding liquidity risk due to the current economic conditions. We thank the participating banks and look forward to strengthening relations with each of them over the coming years.”
Leveraging on strong capabilities and relationships, Bank Sohar has closed all syndication deals, which were primarily with partner banks from Oman and other GCC countries. The project finance team has experience in structuring, appraising, and syndicating projects related to sectors, such as oil and gas, metals, mining and minerals, real estate, tourism, power, road, port, airport, railways, special economic zone (SEZs), and more.
The ‘facility’ joins this suite of comprehensive financial solutions that Bank Sohar provides as part of its large corporate banking unit under its wholesale banking division. The division focuses on servicing large commercial ventures of individuals and corporates with the aim of providing such ventures with superior services, customised banking products to suit individual client needs, and to ensure fast turnaround times of their loan requests.
The unit caters to the domestic and overseas needs of large corporates by offering a wide range of corporate finance products ranging from traditional working capital finance to syndicated project finance. Apart from syndicated loans, Bank Sohar offers a comprehensive suite of project finance facilities for the construction and development of large projects.
These include bilateral loans, guarantee facilities and letter of credit facilities.