Arab Bank sees double digit profit
Dead Sea, Jordan, May 26, 2013
By Suleiman Al-Khalidi
Jordan's Arab Bank , the country's largest lender, said it expects double digit profitability in 2013 as much lower provisions and steady growth in net operating income improves the bank's bottom line.
Chief executive officer Nemeh Al-Sabbagh cited a 7 percent growth in net operating income of the bank in the first quarter, and said that the "full impact of the bank's improved performance in 2013 would show in the second half."
Arab Bank, which has a $45.6 billion balance sheet spread across 30 countries and five continents, has seen a slowdown in profit growth in recent years as it puts aside provisions to cover non-performing loans by businesses reeling from the global downturn.
The bank, one of several major regional and international banks exposed to the debt ridden Saudi conglomerates Saad and Algosaibi, had now fully set aside provisions for their exposure in the troubled firms, Sabbagh told Reuters on Sunday.
Speaking on the sidelines of a World Economic Forum (WEF) conference on the Middle East and North Africa, Sabbagh said that 2013 provisions would be much lower than the $432 million set aside last year and $452 million in the previous year.
He said the wave of political unrest across the region since 2011 would continue to affect business, but a diversified portfolio helped reduce risks.
"We expect the pace of growth to be relatively good despite the economic conditions and turbulence in the region," Sabbagh said.
"In some countries we are doing very well and the only country we are really affected is Syria, but Syria is very small as a size," he added.
Arab Bank's subsidiary in Syria was one of several foreign banks still operating in the violence torn country.
Arab Bank, one of the Middle East's largest financial institutions, owns 40 percent of Saudi Arabia's Arab National Bank ANB.-Reuters
More Analysis, Interviews, Opinions Stories
- Arab Spring boosts demand for bulletproof cars
- Taking the strain out of Gulf-US flights
- Missing jet: Rarest of aviation disasters
- Middle East leads drilling boom
- New engine, new rules and new sound for F1 in 2014
- Qatar rift a pivotal test for GCC
- Lufthansa to offer in-flight movies on smartphones
- Gulf's rift over Qatar may slow investment, reforms
- GCC insurance industry on a stable footing
- Turning charisma into cash: Bernanke's 40 minutes
- 'Healthy' role for private sector needed
- Riyadh, Jeddah among world’s cheapest cities
- US oil export ban could be lifted piecemeal
- Bill Gates with $76bn is world's richest again
- Mideast leads global luxury shopping spend
- ME firms facing ‘record level of cyber attack’
- Clubbing business with leisure and community work
- $27bn capital shortfall facing regional banks
- Obama, wary of foreign crises, faces new Ukraine test
- The brief reign of bitcoin's top exchange
- Iran's fleet back in business as exports pick up
- New food labels to combat obesity
- Dubai says has learned lessons from crisis
- Mt Gox bitcoin customers' money 'virtually gone'
- Now, Bond-style Smartphone from Boeing
- Top trends in workforce management for 2014
- Syrian exporters try to revive businesses
- Saudi spending potential narrowly based
- Obesity becoming the new norm in Europe
- Mobile privacy sells in post-Snowden world