Ahli United net profit hits $502m
Manama, October 31, 2013
Bahrain-based Ahli United Bank (AUB) yesterday reported net profit of $502.2 million for the nine months ended September 30.
This included an exceptional gain of $212.9 million on the sale of its 29.4 per cent stake in Ahli Bank Qatar, according to the report in the Gulf Daily News, our sister publication.
Core earnings increased by 9.5 per cent to $289.3 million compared with $264.2 million last time. Third quarter net profit was 8.6 per cent higher at $99.1 million compared with $91.3 million in the previous year period.
Basic earnings per share were 9.2 cents, compared to 4.8 cents earlier.
The resultant adjusted operating basic earnings per share was 5.3 cents excluding the exceptional gain.
Operating income increased 6 per cent from $660.9 million to $700.8 million in year-to-date terms, driven largely by 11.7 per cent growth in net interest income (NII) to $524.6 million and a 10.3 per cent growth in fee income to $106.7 million.
The NII increase was achieved through effective asset liability management measures undertaken to reduce funding costs and a prudent increase in asset volumes within acceptable risk criteria thereby improving core operating income.
The cost income ratio was contained at 29.6 per cent, as against 29.7 per cent in the same period a year ago.
Total assets rose by 6.5 per cent from the December 31 level to $31.8 billion. Net equity accretion was $0.3 billion during the current period.
The total assets increase was funded by 21.8 per cent rise in customers' deposits to $22.2 billion as at September 30, with surplus liquidity utilised to reduce money market deposits by $1.2 billion and repo borrowings by $1.1 billion.
Loans portfolio grew by 7.7 per cent to $1.2 billion. Non-performing loan ratio was 2.6 per cent as at September 30 and the specific provision coverage ratio was 89.4 per cent.
The total provision coverage ratio inclusive of collective impairment provisions was 150 per cent as at September 30.
Operating return on average equity for the period ended September 30, excluding the exceptional gain, was higher at 14.2 per cent, compared with 13.3 per cent achieved in the prior period.
Return on average assets, on the same basis, was higher at 1.4 per cent.
The International Finance Corporation Capitalisation Fund (IFC Fund) has, at its option, accelerated the conversion of its investment of $125 million in AUB's Mandatorily Convertible Preference Shares (MCPS) into AUB common shares.
Subsequent to September 30, the MCPS was converted into AUB common shares at an effective conversion price of 74.83 cents per share, translating into the issue of 167,045,454 additional AUB common shares. Post conversion, the IFC Fund has a 2.95 per cent shareholding in AUB.
"AUB's resilient performance in a challenging operating environment is reflected in its continuing healthy growth in operating profit which grew by around 9.5 per cent during the current period," said AUB chairman Fahad Al Rajaan.
"The IFC Fund's decision to exercise the conversion option prior to the mandatory conversion date at a price in excess of prevailing market price is a strong vote of confidence in the solid fundamentals of AUB and its regional business strategy," he said. – TradeArabia News Service