Alubaf Arab International Bank has reported 11.1 per cent increase in net profit at $40.7 million for last year when compared with $36.6 million for 2013.

The bank said it had seen another year of "sequentially successful and strong financial performance,” said a report in the Gulf Daily News (GDN), our sister publication.

Net profit for fourth quarter ended December last year was $4.8 million as against $7 million achieved in the same quarter of the previous year.

This drop of 31.3 per cent was mainly due to additional specific and general provisioning considered last year.

Total assets grew by 8.8 per cent and return on average equity improved to 12.6 per cent for the year.

Interest income jumped by 31.6 per cent over 2013 to $45.6 million, mainly due to growth in loans portfolio, which grew by 33.7 per cent over last year.

Alubaf chief executive Hasan Abulhasan said strategic initiatives of widening customer base, entering new markets and de-risking the loans portfolio to a balanced risk-return ratio sustained the steady growth levels and reflect the concerted efforts of the management.

Increase in non-trading investments by 7.8 per cent compared to 2013, also contributed to interest earnings.

Trading realised gain amounted to $488,000.

Gain on sale of non trading investments realised during the year was $332,000.

Fee and commission income for the year dropped slightly by eight per cent compared to 2013, largely due to strategic moves on prudent risk management on changes to product mix and markets, the bank said.

With a provision for credit losses at $7.8 million for the year, the net operating income stood at $54.2 million for the year and resulted in a growth of 14.3 per cent over the previous year's figures.

The bank said it has seen a marginal increase in cost to income ratio, which stood at a level of 24.9 per cent.

Financial ratios indicated healthy and strong financial position of the bank, with liquid assets to total assets at 46.3 per cent and capital adequacy ratio at 42.19 per cent as at December 31 last year.

Abulhasan said he was confident that outlook for the current year was promising with the bank in a strong financial position and gradual growth expected to continue. - TradeArabia News Service