IIB Q3 income hits $1.3 million
Manama, November 18, 2009
Bahrain-based International Investment Bank (IIB) said its total income for the third quarter of 2009 was $1.3 million mainly derived from investment banking fees generated from the structuring, underwriting and placement of new investments.
Announcing the results on Wednesday, IIB chairman Saeed Abdul Jalil Mohammed Al Fahim, said the net loss for the nine month period was $2 million when compared to net income of $12 million for the same period last year.
The bank's total expenses were reduced to $1.9 million in the period, reflecting the lower business activity as compared to the third quarter of 2008. The bank's net loss was $ 0.6 million compared to a net income of $0.8 million earned in the same period of 2008.
Commenting on the results, Al Fahim said, 'Trading conditions in the third quarter of 2009 continued to be very challenging for investment banks. We have seen some positive indicators concerning investors’ confidence and availability of funding but do not expect a significant improvement in market conditions until the first quarter of 2010.'
The IIB chief attributed the lower net income mainly to fewer investment banking transactions as 'the bank has intentionally scaled down its investment activities as a measure of prudence in the current market situation and lower profit rates applicable to bank placements.'
The total assets as of September 30, 2009 were put at $191.4 million compared to $218.7 million at the end of 2008. The decrease arises following the payment in 2009 of the 2008 cash dividend of 7 per cent and fair value write downs on several available for sale investments, Al Fahim noted.
'The capital adequacy ratio was 64 per cent as at September 30, 2009 which is more than five times the Central Bank of Bahrain’s minimum requirement of 12 per cent, demonstrating IIB’s capacity to significantly increase its investment portfolio in the future from a regulatory capital perspective.'
The Bank, Al Fahim said, has continued its strategy during the third quarter of 2009 of investing in selective opportunities and managing its liquidity.
IIB’s asset position demonstrates strength with 43 per cent of total assets at September 30, 2009 represented by cash, bank balances and short-dated Murabaha placements with financially-sound regional banks.
'The Bank has no “Banks Borrowings” and thus is not under any liquidity pressure,” Al Fahim added.
Aabed Al-Zeera, CEO and board member said, 'Since inception of the Bank, our strategy has been to structure and market to clients a range of attractive investment offerings in the manufacturing, financial, energy and real estate sectors in various countries.'
During the third quarter of 2009, work commenced on IIB’s recently acquired project to develop a state-of-the-art “commercial” real estate complex in Bosnia and Herzegovina and a well positioned “residential” project in Saudi Arabia.-TradeArabia News Service