Bahrain-based Arab Banking Corporation (ABC) has registered a consolidated group net profit of $204 million for 2011, 43 per cent higher than 2010.

The surge was achieved despite the challenges from unprecedented adverse political and economic events arising from the Arab spring and Eurozone crisis.

Revenues rose $99 million to $818 million, while operating expenses increased by $55 million to $414 million, resulting in cost to income ratio of 51 per cent.

Impairment provisions for regional and international exposures, cushioned by recoveries, resulted in the net charge for the year of $28 million compared to $77 million for the previous year. Net profit for the fourth quarter was $47 million.

Strong revenues from treasury, trade finance and retail business lines in the Arab World boosted the Group’s earnings with significant contribution from its Brazilian subsidiary, demonstrating the benefits of the Group’s product and geographical diversification.

The performance was achieved whilst ABC continued to derisk and deleverage the balance sheet resulting in comfortable liquidity levels being maintained throughout the year as the Group’s total assets declined 11 per cent to $25,015 million.

Liquid assets to deposits ratio at the year-end was 64 per cent.

Shareholders’ equity at December 31, 2011 stood at $3,598 million compared to $3,428 million last year. ABC Group’s capital adequacy ratio at 2011 year-end was very strong at 24.3 per cent, predominantly Tier 1, which totalled 19.2 per cent.

Hassan Juma, president & chief executive of ABC, said, “Proactive and prudent management ensured strong results in an exceptionally challenging year. It is particularly satisfying to see that all ABC units and product segments contributed to the remarkable performance.”

“It is fitting that the international rating agency S&P has removed the negative credit watch and reaffirmed ABC’s investment grade rating (BBB-) with a stable outlook,” he added.

ABC's chairman, Saddek El Kaber said, “I am pleased that ABC’s core strengths and geographical diversification enabled it to withstand severe external shocks and yet deliver outstanding results.”

“With the ongoing support of the shareholders ABC is very well positioned to boost its drive to build Mena’s leading universal bank,” he added. – TradeArabia News Service