Farouk Yousuf Almoayyed and Abdul Razak Hassan Al Qassim
NBB net profit hits $126.3m in 2012
Manama, January 21, 2013
National Bank of Bahrain (NBB) has registered a net profit of BD47.50 million ($126.33 million) in 2012, up 4.1 per cent compared to BD45.64 million recorded the year before.
Strong growth in revenue and careful expense management resulted in operating profits before provisions of BD59.27 million ($157.62 million) for 2012, an increase of 11.2 per cent over the previous year, said the Bahraini lender in its statement.
For the fourth quarter, the bank recorded a net profit of BD10.47 million ($27.85 million) compared to BD9.69 million for the corresponding period of the previous year, thus registering an increase of 8.1 per cent.
The bank's net interest income for the year stood at BD61.92 million, up 11.8 per cent on account of growth in earning assets supported by a strong growth in customer deposits besides improved yield on the bond portfolio.
Speaking at the board of directors meeting on Monday, NBB chairman Farouk Yousuf Khalil Almoayyed, said these results were a testimony to the resilience of the bank’s business model which focuses on balanced growth.
Higher Commission and Exchange Income from increase in business volumes has been partly off-set by lower dividend income on the Bank’s equity investments, resulting in a modest growth of 0.6 per cent in other income which stood at BD24.69 million.
The operating expenses were carefully managed which showed a marginal increase of 2.7 per cent, resulting in the cost to income ratio improving from 33.3 per cent in 2011 to 31.6 per cent in 2012.
CEO and director Abdul Razak A Hassan Al Qassim said NBB had maintained its growth momentum during the year with an impetus on selectively expanding the loan book while efficiently deploying surplus liquidity in other earning assets resulting in a strong increase in business volumes and revenue.
The Bahraini lender had set aside BD9.21 million as specific and general loan loss provision to further strengthen the balance sheet. Additionally, BD2.56 million was provided towards impairment on equity investments due to declining stock market valuations, he added.
The total balance sheet stood at BD2.65 billion as at 31 December 2012 compared to BD2.38 billion as at the previous year-end. The customers’ deposits surged 9 per cent to hit BD2.07 billion, reflecting the continued success of its deposit mobilization initiatives.
The total earning assets stood at BD2.51 billion as at 31 December 2012 compared to BD2,25 billion as at the previous year end, reflecting a growth of 11.2 per cent.
The NBB capital adequacy ratio remained healthy at 27.9 per cent. The Bank has a well diversified asset composition with strong liquidity.
According to Almoayyed, the NBB board has proposed to the shareholders a bonus issue of BD8.55 million at the rate of one additional share for every ten shares held (10 per cent).
The bonus share issue is proposed to be made through utilisation of BD8.55 million from the General Reserve, which is subject to regulatory approvals, the bank said in its statement.
Total cash and stock dividend payouts for 2012 amounts to 35 per cent, it added.
Total shareholders’ equity before 2012 appropriations stood at BD318.94 million. The appropriations to donations and contributions will bring the total allocation under the programme to BD31.78 million.
Looking ahead, Qassim said, “NBB is well positioned to achieve its strategic business priorities capitalizing on the well established business franchise, strong capital base and adequate liquidity as we emerge from what has been a difficult and challenging period.”-TradeArabia News Service