Bahrain-based Ithmaar Bank has posted a income of $51.4 million before impairment provisions and taxation for 2010 as compared to a net loss of $44 million for 2009.

The bank was back on track in spite of posting a consolidated loss of $150.1 million attributable to the shareholders of the bank after recognising conservative impairment provisions of $197.4 million.

That compared with a loss of $247.4 million for 2009.

The results include a consolidated fourth-quarter loss of $161.3 million which compares to a loss of $167.2 million for the same period a year before.

The results also show that the bank's total consolidated income improved by $103.2 million, or 92 per cent, over 2009.

'Market conditions continue to be especially challenging and volatile, particularly for a retail bank that has recently transitioned from an investment bank,' said chairman Prince Amr Mohammed Al Faisal.

'The results, however, show a full turnaround in Ithmaar Bank's income, with the bank reporting a net income of $51.4 million before impairment provisions and taxation for 2010 as compared to a net loss of $44 million for 2009.

'The bank, nonetheless, continues to build prudent impairment provisions, with a net provisions charge of $197.4 million in 2010 marginally lower than those taken in 2009,' he said.

'A significant portion of these impairment provisions are for the investment portfolios. The results include $57.5 million which represent profits arising from the sale of certain assets to a related party.'

'Ithmaar's balance sheet remains strong and continues to grow, with total assets increasing by 10.5 per cent to $6.7 billion,' Prince Amr said.

'Shareholders' equity remains strong at $654 million,' said Ithmaar Bank chief executive officer Mohammed Bucheerei.

'It is very encouraging to note that customer current and investment accounts also continued to grow and are a stable source of funding for an already strong deposit base.

'Following the reorganisation in April, the bank's new strategy is focused on developing its retail banking in Bahrain and the GCC with a view to becoming the leading regional Islamic retail bank,' said Bucheerei.

'In 2010, for example, we expanded our customer reach in Bahrain by adding five new ATMs and introducing a new, first-of-its-kind mobile online banking service. We also introduced new customer-focused products, including Thimaar, a best of its kind prize-based savings account, and improved a number of our retail products including our personal and car finance offerings.'

'The bank also continues to focus on growing its core retail business overseas,' he added.

'Our Pakistan subsidiary, Faysal Bank Limited (FBL), for example, fully acquired the operations of RBS Pakistan in 2010, increasing the number of FBL branches to 220. Despite our retail expansions, both in Bahrain and overseas, operating expenses have been strictly controlled.

'In 2010, Ithmaar repaid all its contractual obligations and managed to refinance its major liabilities, which will now mature in 2015.' – TradeArabia News Service