AMMAN: The board of Arab Bank, Jordan's largest lender, has elected Sabih Al-Masri to take over at the helm of the bank after the resignation of Abdel Hamid Shoman this month in a dispute over the chairman's power.
Shoman abruptly resigned on Aug. 16 after the board and key shareholders failed to back him in a power struggle with Chief Executive Nemah Al-Sabbagh, in which Shoman was accused of meddling in the day-to-day running of the bank.
In a letter of resignation, Shoman said the management of the bank, founded by his family in Jerusalem and one of the Middle East's largest financial institutions, had steered away from it's founders' vision.
In a news conference with board members, Al-Masri, who has large investments in the hotel industry and agro-business, said he was elected unanimously by the board.
Al-Masri pledged to help Arab Bank, which has a $45.6 billion balance sheet spread across 30 countries and five continents, maintain the steady growth it has shown in recent years.
"All the financial ratios point to a solid financial position and to continued growth in every aspect of the balance sheet," Al-Masri said.
The firm is one of the Arab world's largest privately owned banks. Over 20 percent is owned by the family of Lebanon's former prime minister, Rafik al-Hariri, who was assassinated in 2005. Jordan's social pension fund has a 15.5 stake.
The Shoman family owns 5 percent.
Other shareholders in Arab Bank, which owns 40 percent of Saudi Arabia's Arab National Bank (ANB), include the Saudi Finance Ministry with 4.5 percent and Qatar with 1.65 percent.
Based in Amman, but with only a fifth of its assets and a quarter of its deposits in Jordan, the bank has built a reputation for stability amid regional political upheaval.
Al-Masri also denied media reports the Hariri family, the largest single shareholder, sought to sell its 20 percent stake to Qatari investors.
Mohammad Hariri, who attended the board meeting, denied the family was seeking to sell its holding to any party, including National Bank of Kuwait which some banking circles said was being discussed.
"This is untrue and baseless, we have not entered into any talks or negotiations over the sale of our shares to NBK or any party," Hariri told Reuters after the board meeting.
The Central Bank, concerned about how the board room shake-up could affect the bank, emphasized that the lender was financially sound and reiterated its confidence in its management.
Despite the regional downturn, its traditionally loyal Arab customer base raised deposits by more than 3.6 percent to $32 billion at the end of June 2012 against the same period last year.
Arab Bank's shares closed almost 5 percent higher yesterday, at 7.72 dinars, recouping losses since Shoman's resignation.