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Arab Banking Corporation net profit up 7pc

MANAMA, February 28, 2015

Bahrain-based Arab Banking Corporation (ABC) said its consolidated group net profit for the year ended 2014 rose seven per cent to $256 million from $239 million the previous year.

The net profit for the fourth quarter was $59 million as against $61 million reported in the previous year, said the statement from the bank.

Announcing the results, ABC said its total operating income surged to $888 million from $857 million in 2013 with broad-based growth in revenues across all geographies and products contributing to the $31 million increase, after absorbing the negative impact of the stronger dollar against the domestic currencies of some subsidiaries.

Operating expenses amounted to $439 million, a slight saving on the $440 million reported in the previous year reflecting the interplay of cost saving initiatives combined with investments for future growth.

Cost to income ratio improved to 49.4 per cent from 51.3 per cent in 2013, mainly from revenue growth. Net impairment provision charge of $64 million, was $15 million higher than in the previous year, which had benefited from some exceptional recoveries, said the statement.

Although the provision charge was higher, the ratio of NPLs (non-performing loans) to gross loans declined to 2.4 per cent from three per cent at 2013 year-end.

Impressed with the results, the board of directors has recommended a cash dividend of five per cent of the issued share capital ($0.05 per share), amounting to $155.5 million, it added.

On the results, chairman Saddek El Kaber, said: "We are pleased to report another strong performance in 2014. The group continued its growth across various geographies whilst managing well its expenses and cost of credit."

"We will continue to develop initiatives to enhance our earning capability ensuring sustainable growth in the years to come," he stated.

Whilst ABC Group’s total assets registered a growth of 11 per cent during 2014 to stand at $29.4 billion as of December 2014, the asset book remained diverse and primarily short term, with 59 per cent of assets having a tenor of less than one year.

According to ABC, the deposits grew by seven per cent from $18.3 billion at 2013 year-end to $19.7 billion.

The group’s liquidity position continues to be strong with liquid assets to deposits ratio at 65 per cent (63 per cent at 2013 year-end).

The group further diversified its funding profile in 2014 through its raising of new longer term borrowings of $1.1 billion, it added.-TradeArabia News Service




Tags: Bahrain | Arab Banking Corp |

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