Mumtalakat and ARP Group to Launch AI-Native Wholesale Bank in Bahrain

Bahrain’s sovereign wealth fund, Mumtalakat, has partnered with ARP Group to establish a new AI-native and blockchain-enabled wholesale bank. This venture, which has received in-principle approval from the Central Bank of Bahrain, signals a significant shift toward integrating distributed ledger technology and artificial intelligence into the core infrastructure of regional institutional banking.

What was announced

The partnership aims to launch a wholesale bank headquartered in Bahrain, specifically designed to serve regulated financial institutions, payment companies, and businesses with extensive cross-border operations. The new entity is intended to address the fragmentation and high costs associated with traditional international financial services by utilizing a "digital-first" architecture.

The bank’s operating model is being designed to use artificial intelligence across its operations and will offer programmable services that connect directly with clients' systems through APIs. This technological foundation is paired with blockchain infrastructure to reduce the complexity of serving clients whose needs span multiple markets and currencies. While the venture has secured in-principle approval from the Central Bank of Bahrain, it will only commence regulated activities once final authorization is granted.

Products and services will be introduced in phases, with the initial offerings informed by direct engagement with prospective institutional clients. The leadership and founding team includes Yusuf Alireza, who co-founded ARP Digital alongside Abdulla Kanoo and Abdulaziz Kanoo. The venture seeks to combine the balance sheet and institutional relationships of a regulated bank with the efficiency of modern financial technology, ensuring that appropriate human oversight, governance, and risk controls remain central to the AI-driven model.

"Financial services have long been a cornerstone of Bahrain's economy, and as the sovereign wealth fund of the Kingdom, our role is to invest in opportunities that strengthen the sector's competitiveness and support its continued evolution. Through this partnership, we are bringing together an experienced institutional team with Bahrain's well-established regulatory and business environment, further reinforcing the Kingdom's position as a leading regional financial hub."

Shaikh Abdulla bin Khalifa Al Khalifa, Chief Executive Officer of Mumtalakat

The companies involved

Bahrain Mumtalakat Holding Company, known as Mumtalakat, serves as the sovereign wealth fund for the Kingdom of Bahrain. It manages a diverse portfolio of assets across multiple sectors, with a mandate to support the Kingdom’s economic diversification and long-term wealth creation. Historically, Mumtalakat has been a pivotal player in Bahrain’s industrial and financial landscape, investing in strategic sectors that provide sustainable returns and contribute to the nation's economic growth. Its investment strategy focuses on sectors that strengthen the Kingdom's competitive position on a global scale.

ARP Group is the holding company for ARP Global Capital and ARP Digital. The group is led by Yusuf Alireza, who serves as Chairman, and the digital arm was co-founded by Abdulla Kanoo and Abdulaziz Kanoo. The group focuses on institutional finance and digital financial infrastructure, positioning itself at the intersection of traditional banking and emerging technologies. By leveraging Bahrain’s established regulatory framework and financial sector experience, ARP Group aims to modernize the delivery of wholesale financial services. The collaboration brings together the capital and strategic oversight of a sovereign fund with the specialized technical and institutional expertise of a team experienced in global finance and digital asset infrastructure.

What this means

This move highlights the growing pressure on traditional wholesale banks to modernize legacy infrastructure that has long made cross-border transactions slow and expensive. While retail banking has seen a wave of digital disruption, the wholesale sector has remained relatively insulated due to its complexity and high regulatory hurdles. By building an AI-native bank from the ground up, Mumtalakat and ARP Group are challenging the status quo of fragmented institutional services. The success of this venture will likely depend on whether blockchain and AI can truly lower the cost of capital and operational overhead enough to lure institutions away from established global giants. It also signals Bahrain’s intent to remain a competitive financial hub against regional rivals by embracing regulated, technology-led banking models.