You see, with the opening up of the free trade region, Omani's were exporting deposits to Islamic Banks in other GCC countries at an increasing rate. That was the convincer.
So with great enthusiasm a few big wheels decided to start Oman's first bank that will base their operations on Sharia principles. The IPO was a great success, almost 11x over subscribed and raising $160 million.
In typical Omani style, the bluster and enthusiasm combined with a slopshod approach to corporate governance and management was not matched by performance.
The initial shareholders meeting, required to establish the 'constitution' of the company so it can legally start operations, couldn't make a quorum of the required 75% of shares. Oh dear.
So the company set up with over a 150 million dollars in shareholders cash can't even organize a meeting. And not just any meeting. The most important meeting a public company ever has, its first General Meeting. This is now being seen as representing not just (by definition) a big Omani company with piss-poor management, but as casting doubt on the competence of the Muscat exchange to run a real public offering. The Dubai exchange must be pissing themselves laughing.
Of course, all of this in no way whatsoever reflects badly on the reputation or honour of the very important Omani people involved. They have moved heaven and earth to bring this tremendously important and complex project to what has been, in reality, a great success. The backers of the company, the outstanding advisors, and the stock exchange itself are run by the best there is. They're just great. They not only did everything humanly possible, but did it with the highest of intentions, guided by the vision of His Majesty in this glorious time to be a banker in Oman.
And the Government regulator was totally blameless. Nothing they could have done to avoid this.
This delay and mix-up was not only completely understandable, and normal, and yanni to be expected,and inshallah the paperwork will be ready soon.
There's certainly nothing for anybody to get offended or insulted about here. Just keep repeating what a tremendously successful thing Bank Nizwa is. I'm sure the crack reporters at The Observer and Times of Oman are on the case.
The reputations of those responsible must not be tarnished by a mere failure to achieve results. This is in line with the deep cultural traditions of Omani society not to point out in public when someone - especially someone officially very important - cocks everything up. Whoever was responsible was certainly not Omani. They will be found and sent back to the sub-continent they came from.
Fortunately, we have laws in this country. Laws to protect people's reputation from things like a public discussion of observable facts that relate to their performance.
And whoever it was that pointed out the mistake and officially noted the lack of a legal quorum at that meeting deserves a promotion. Now that was a person actually doing their job.
Post-press: Times of Oman publishes Bank Nizwa response.
.... However, Ahmed Said Al Rawahi, Chairman of Bank Nizwa Founding Committee, stated; "The bank's launch preparations are progressing as scheduled. Our staff is in place, the first three branches at Muscat, Nizwa and Sohar are currently being fitted out, the core banking system has already been deployed, and the product portfolio is under approval.
"The general meeting could not be concluded on the appointed day of June 21 as Bank Nizwa has a large base of over 37,000 shareholders with many of them not being in the country owing to the current holiday season. This made it difficult to achieve the requisite attendance norm and we are rescheduling the meeting. We are confident that in the next meeting we will have the requisite quorum, he explained. As per the law, votes representing 75 per cent of the bank's capital are required to conduct the meeting. Bank Nizwas has 92 founding members, who have collectively invested RO90 million.
'We are on track'
Saying that the rescheduling will not affect the bank's launch plans, Al Rawahi noted, "I am glad to inform that we are on track to be ready to open our doors to the public during the third quarter of 2012, subject to CBO approval.
The date of the new meeting is being agreed with appropriate authorities and will be scheduled to take place sometime within the next six weeks, in keeping with Capital Market Authority regulations.
Market sources said there is no clarity on when the regulation on Islamic banking will be issued and when Bank Nizwa to commence operation, which have affected the bank's share prices on the bourse. "There has been a lack of interest among institutional investors, while retailers continued their selling, said Kanaga Sundar, Senior Analyst at Gulf Baader Capital Markets.
Yes indeed, so as I said, everything is a great success and it's all going according to plan.