Oman's United Finance Co said on Wednesday that Bank Nizwa had approached it with a proposal for a strategic merger.

United Finance's board will consider the proposal at its next meeting, the company said without giving any details. It noted that any merger would need the approval of the board of directors, shareholders and regulators.

Bank Nizwa, which started operations in 2013 as one of Oman's two full-fledged Islamic banks, has a market capitalisation of about $320 million, according to Thomson Reuters data.

United Finance describes itself as Oman's largest non-bank financial institution, and offers loans and leasing services as well as corporate deposits. Its market capitalisation is about $105 million.