First Leasing Bank (FLB), established to pioneer the business of equipment leasing in the GCC, has recorded a net profit of $4.5 million for the year ended December 31, 2007.

The bank’s net portfolio, representing originated leases and investments, increased to $54.5 million, said an officials spokesman.

“Our 2007 annual results are extremely positive for a bank still in its infancy and operating in a nascent market. FLB’s solid performance in 2007 is indicative of the soundness of the bank’s business strategy and, indeed, of the original vision of establishing this first-of-its-kind institution in the region. It also underscores the professionalism and experience of the team that we have built at FLB,” said FLB chairman, Khalid Kanoo.

“Just three years since our inception, we have already established ourselves in Kuwait, Bahrain and the UAE and this year we look forward to expanding our GCC presence. The Bank is poised for further regional expansion as we continue to build our portfolio and diversify our asset base,” he added.

A successful increase in the FLB’s capital in December, 2006, from $11 million to $100 million, has allowed it further strengthen its portfolio and diversify its assets, double its staff and develop its organisational and systems infrastructure.

The bank soon expects to be entering new high-growth markets within the GCC, including Qatar and Oman.

The bank, which is a part of the Ithmaar banking group, presented its result to the shareholders at an Annual General Meeting in Manama.

The bank’s net profit was supported by an impressive operating income, which surged to $7.1 million, from $1.4 million in 2006. Total assets increased to $102.3 million while shareholders’ equity stood at $100.8 million.

“Despite a $600 billion global equipment leasing industry, the GCC market has remained virtually untapped, except for finance leases being offered as secondary products through some commercial banks,” said FLB CEO James Cracco.

“By introducing concepts such as operating leases, which allow business to free up their capital to invest in higher returning core business lines, we are literally creating a new industry in this region. This year our pioneering status was recognised by our banking industry peers through a poll conducted by Islamic Finance News, which named First Leasing Bank as the ‘Best Islamic Leasing Provider’ for 2007,” he added. – TradeArabia News Service