Trowers advises Ahli United Bank on its conversion to a fully Shari’ah-compliant bank

Trowers & Hamlins, has advised Ahli United Bank (UK) on its conversion from a conventional bank to a fully compliant Islamic bank, the conversion being the first of its kind in the UK banking industry.

AUBUK’s switch to offer Shari’ah compliant finance products only follows on from the acquisition of its parent, Ahli United Bank Bahrain (AUBB), by Kuwait Finance House in August 2022 and its subsequent transformation into a fully Shari’ah compliant bank which Trowers also advised on.

The firm advised on all aspects of the conversion process from advice on the options available to the bank to achieve the goal of becoming an Islamic bank through to the review and update of existing Shari’ah compliant products. The firm also continues to advise on the preparation of new Shari’ah compliant products which will be offered by the bank shortly following the conversion (including ensuring those products being made available to retail customers comply with UK financial services requirements) and advice on its strategy for communicating the changes to its customers.

John Lunn of Morton Fraser MacRoberts LLP, the firm’s Scottish Interlaw partners, assisted on AUBUK’s customer communications strategy, compliance with the FCA’s Consumer Duty and financial services regulatory matters.

The Trowers team was led by partners Helen Fysh, Simon Valner and Katharine Lewis (Banking and Finance). There was wider involvement in the transaction from the Real Estate, Corporate, Dispute Resolution and Litigation and Tax teams in the UK as well as assistance from colleagues in Trowers’ Oman and Kuala Lumpur offices. This included support from partners Salman Ahmed, Nick Edmondes, Victoria Robertson, Alex Burton, Nick Harrisingh, Adrian Jones, Nathan Williams, Debopam Dutta, William Clements and Elias Moubarak, senior associates Lilli Sutherland, Jon Grosvenor, Laura Pennells and Cara Gillingham, associates Sam Robinson, Abdullah Puri, Alyson Phung, Jian-Jie Phang, Daniel Butt and Tiffany Tan, trainee solicitor Hannah Chima, paralegals Olena Sobchenko and Oksana Maslianko and professional support lawyer David Zong.

Helen Fysh, commented, “We are delighted to have advised Ahli United Bank (UK) on its groundbreaking, market-leading conversion to a fully Shari’ah compliant institution. This landmark transformation underscores our commitment to innovation in Islamic finance, guiding the bank through the entire process from strategic planning to advising on both existing and new Shari’ah compliant products. This successful conversion sets a new standard in the UK banking sector and reinforces our role as a leader in Islamic finance advisory services.”

Mirna El Achkar, general counsel of Ahli United Bank commented, “Trowers & Hamlins acted as our lead advisors both in Bahrain and the United Kingdom and played a major role in the success of this one-of-a-kind transaction. What distinguishes the firm is the excellent collaboration among the teams in different jurisdictions and time zones as well as across their areas of expertise. The teams combined a deep understanding of Islamic Finance both on the theoretical and the technical/structural levels with a practical business-minded approach which was key to address the risks and achieve a seamless conversion. This highly complex transaction required a global knowledge of Islamic Shari’ah requirements and a great deal of creativity which Trowers managed to manoeuvre to provide effective legal solutions and an on-target advice. While the result speaks for itself, I must give praise to the firm’s accessibility, flexibility and outstanding responsiveness of the team members, without which none of the challenging timelines would have been met.”