2nd Quarter Financial Results 2016 - Press Release

2nd Quarter Financial Results 2016 - Press Release

Net Profit of BD 31.72 million (US$ 84.36 million) for the 1st Half of 2016,

Increase of 6.9 % over the previous year

The Bank recorded a Net Profit of BD 31.72 million (US$ 84.36 million) for the six months ended 30 June 2016 compared to BD 29.67 million (US$ 78.91 million) for the corresponding period of the previous year, an increase of 6.9 %. For the second quarter of 2016, the Bank recorded a Net Profit of BD 13.96 million (US$ 37.13 million) compared to BD 12.65 million (US$ 33.64 million) for the corresponding period of the previous year, an increase of 10.4 %.

The financial results were approved at the Board meeting held on 20th July 2016 chaired by the Bank’s Deputy Chairman Dr. Essam Abdulla Fakhro. On behalf of the Board, Dr. Fakhro expressed his satisfaction on the excellent results recorded by the Bank, particularly in such challenging times. He thanked the executive management team and employees for their dedicated service and the Bank’s clients for their valued business relationship and the confidence reposed by them in the institution.

Commenting on the Bank’s performance, Mr. Abdul Razak Abdulla Hassan Al Qassim, Chief Executive Officer & Director said, “The Bank recorded strong growth in profitability and business during the 1st half of 2016. Despite difficult market conditions, the Bank’s improved performance is an outcome of our ability to adapt to changing market dynamics while continuing to keep customers interest at the forefront.”

The Net Interest Income for the six months period in 2016 was BD 31.82 million (US$ 84.63 million) compared to 29.10 million (US$ 77.39 million) for the corresponding period of the previous year, an increase of 9.3 %. The increase in Net Interest Income is attributed to strong growth in Loans & Advances and higher yield on surplus funds. Other income for the six months period in 2016 was BD 19.70 million (US$ 52.39 million) compared to BD 21.90 million (US$ 58.24 million). The decrease in Other Income was due to capital gains on sale of certain fixed rate investments in the previous year which was not available in 2016 due to prevalent market conditions. However, income from other core activities continues to show steady increase. In addition, the Bank realized a profit of BD 3.89 million (US$ 10.35 MM) from sale of equity investments during Qtr 2-2016. Operating expenses continue to be closely managed which increased from BD 15.06 million (US$ 40.05 million) for the six months period in 2015 to BD 15.86 million (US$ 42.18 million) for the six months period in 2016 mainly to cater to increased business requirements. The Bank took a General Loan Loss Provision of BD 1.00 million (BD 2.66 million) during the current quarter to further strengthen the Balance Sheet. Continued decline in stock market valuations resulted in an impairment charge on equity investments of BD 2.45 million (6.52 million) during the current year.

The core business of the Bank continues to show steady growth with the Total Earning Assets (comprising of Treasury bills, Bank placements, Loans & Advances, Investment Securities and investment in associates) as at 30 June 2016 at BD 2,817.38 million (US$ 7,493.03 million) compared to BD 2,731.20 million (US$ 7,263.83 million) as at 30 June 2015. Customer Deposits stood at BD 2,195.90 million (US$ 5,840.16 million) as at 30 June 2016 compared to BD 2,227.68 million (US$ 5,924.68 million) as at 30 June 2015. 

The Earnings per share for the six months of 2016 improved to 27.7 fils compared to 26.0 fils for the corresponding period of 2015. Return on Average Equity improved to 17.9 % compared to 15.6 % for the corresponding period of 2015.

Financial Summary (30 June) (in Millions)

  2016 BD 2016 USD 2015 BD 2015 USD
Loans and advances 1,028.85 2,736.30 923.27 2,455.51
Investment securities 1,032.27 2,745.40 968.63 2,576.14
Total Earning Assets (Treasury Bills, Bank Placements, Loans & Advances, Investment Securities and Investment in associates) 2,817.38 7,493.03 2,731.20 7,263.83
Total assets 2,966.26 7,888.99 2,884.66 7,671.97
Customers’ deposits 2,195.90 5,840.16 2,227.68 5,924.68
Total Equity 343.28 912.98 383.45 1,019.81
         
Net Profit 31.72 84.36 29.67 78.91
         
Earnings per share
27.7 fils  7.4 cents 26.0 fils  6.9 cents
Annualised return on average equity 17.9 % 17.9 % 15.6 % 15.6 %