National Bank of Bahrain (NBB) today announced strong financial results for the full year ending December 31, 2018 with a 14.8% rise in net profit, which reached a record BD70 million ($186.1 million), compared to BD61 million in 2017.  

 

Continued growth was supported by gaining new clients in all segments and diversifying the range of products and services offered. 

 

For the fourth quarter of 2018, the bank’s net profit increased 29.3% to BD15 million ($39.9 million) compared to BD11.6 million ($30.9 million) in the prior-year period.

 

Key financial highlights:

o Operating profit before one-offs rose 10.9% y-o-y to BD75.6 million ($201.0 million) for 2018 compared with BD68.2 million for 2017 (excluding certain one-off income of BD3.3 million in the previous year) illustrating the business development. For the fourth quarter, it rose by 14.8% to BD18.1 million compared with BD15.7 million in the fourth quarter of last year; 

o Net interest income increased 19.4% y-o-y to BD87.2 million compared with BD73.1 million in 2017. For the fourth quarter of 2018, it rose 20.9% to BD23.1 million compared with BHD 19.1 million in the fourth quarter of 2017.

o Other income increased by 7.5% y-o-y to BD30.2 million compared with BD28.1 million in the prior-year [excluding certain one-off income of BD3.3 million in the previous year]. For the fourth quarter of 2018, it increased by 3.6% to BD5.8 million compared with BD 5.6 million in the fourth quarter of 2017. 

o Operating costs increased 26.7% to BD41.8 million compared to BD33.0 million last year in line with ongoing investments in human capital and technology to support the bank’s transformation strategy.

This resulted in an increase to the bank’s cost-to-income ratio, which reached 35.6% for the year. For the fourth quarter of 2018, operating costs were BD10.8 million compared with BD8.9 million in fourth quarter of 2017.

o Total assets increased by 3.0% to BD3,195.5 million compared to BD3,101.5 million last year.  

o Average loans and advances increased by 8.7% to BD1,272.3 million compared with BD 1,171.0 million last year.

o Average customer deposits remained flat at BD2,107.8 million in an overall flat market.

o Earnings per share for the year increased from 44 fils in 2017 to 51 fils for the full year 2018.  

 

Farouk Yousuf Khalil Almoayyed, chairman of NBB, said: “On behalf of the Board, I’m pleased to announce another year of record results for NBB. Profitability grew a significant 14.8% in a year where NBB made strategic investments that supported the bank’s transformation plans. Tangible growth has been achieved across the businesses as well as substantial enhancements to our human capital. Improvements in our technology and infrastructure are noticeable, setting the foundations for steady and sustainable development. In particular, we are pleased with the results of the bank’s efforts to diversify and digitalise our business, increase our participation in the local economy and launch our expansion in key regional markets such as Saudi Arabia and the UAE. 

 

Jean-Christophe Durand, chief executive officer of NBB, added: “2018 marked the first full year of NBB’s transformation journey initiated last year.  The bank’s results underscore the progress we have made in enabling the Bank to adapt to the fast-changing environment and establishing a sustainable growth trend. The growth in net profitability for the year and very importantly, the growth achieved at operating profits level (before one-offs) reflect the strengths of our business development initiatives combined with the implementation of a robust risk framework.  Contributing to these results were also stepped up efforts to support growth in the national economy, which remains at the core of our strategy. During the year, NBB was part of strategic financing for the Kingdom of Bahrain and an active player in capital markets transactions. We grew our support for SMEs and enhanced our product and services offering for our retail client base.”

 

Durand continued: “Technology plays a significant role in all of these efforts as we advanced our digitisation programme aimed at delivering our products and services efficiently, simply and seamlessly. To this end, in 2018, we rolled out a new business online banking platform and website and are focused on accelerating our digital capabilities and adoption in the year ahead. In 2018 again, a strong focus was dedicated to talent acquisition and identification within the Bank and our commitment to human capital development now positions NBB as an employer of choice for Bahraini talent, which was one of our key targets. We enter 2019 with strong momentum and commitment to delivering on our strategy and strengths for the benefit of all of our stakeholders.” 

 

Based on the above results, the board of directors has recommended to the Shareholders’ general assembly, the following appropriations: Cash dividend: 25% (2017: 25%) -BD35.1 million; Donations and contributions - BD3.5 million; Transfer to general reserve - BD21 million.

 

The board has also proposed to the shareholders a bonus issue of BD14 million at the rate of one additional share for every 10 shares held. The bonus share issue is proposed to be made through utilisation of BD14 from the general reserve, which is subject to regulatory approvals.  –TradeArabia News Service