National Bank of Bahrain Group said it has executed Bahrain’s first sustainable collateralized murabaha, a Sharia-compliant financing valued at more than $50 million.
The group comprises National Bank of Bahrain (NBB) and Bahrain Islamic Bank (BisB). It said funds raised through the arrangement will be allocated against its portfolio of environmental, social and governance (ESG) assets.
NBB handled the structuring and execution of the facility, drawing on its market and liquidity management operations, the group said in a statement carried by News of Bahrain. Gulf Daily News and TradeArabia also reported the deal.
BisB applied its Islamic treasury operations and its Sustainable Finance Framework, which the group said is aligned with International Capital Market Association (ICMA) and Loan Market Association (LMA) principles.
The statement did not name the counterparty or give the tenor or pricing of the facility.
A murabaha is an Islamic financing structure based on a cost-plus sale rather than interest. In a collateralized version, the borrower pledges assets as security.
“This transaction meets those requirements while extending the range of Sharia-compliant solutions available through the Group and establishing a repeatable foundation for more sophisticated market activity,” said Husain Almohri, group chief executive for markets and client solutions at NBB.
Ameer Dairi, chief financial and strategy officer at BisB, said applying the bank’s framework to the arrangement “brings Sharia discipline and transparency” to the link between its funding and the assets it supports.
NBB owns a majority stake in BisB. Both banks are listed on the Bahrain Bourse.
