Bahrain Middle East Bank (BMB) has recorded an income of $6 million in the first half of 2011 against $2.4 million in the same period last year, marking a 150 per cent increase.
 
The bank is continuing its journey to position itself as a niche and specialist financial service provider in the region and beyond, said chief executive officer Akbar Habib.

"The bank continues to forge ahead in implementing its strategy in a measured and systematic manner," said Habib.

"Qualitative and quantitative results have been witnessed across the bank's business operations and financial performance. The second quarter also marks a significant milestone in the bank's relentless effort to remedy all actions and inactions of the past and their negative consequences on its balance sheet with all such issues now being addressed and normalised.”

"The qualitative shift in the bank's sources of income signifies the viability and diversity of its new model, particularly in light of the level of uncertainty and volatility seen in the present market environment," he said.

"However, caution is maintained in respect of the European and US uncertainties which pose a new challenge for global markets and financial institutions around the world. Diversity is the order of the day, even within various asset classes, as the bank looks to gradually expand the breadth and depth of operations in a measured and disciplined manner with the aim of achieving the desired levels of diversity and sustainable sources of income," he added.

Growth was fuelled by new initiatives and non-private equity sources. Fees commission income from asset management and trade finance initiatives amounted to $1.4 million, representing a 14-fold increase compared with $100,000 in the same period last year.

Trading equities and fixed income amounted to $1.3 million as against a loss of $30,000 last time. Non-private equity sources made up two-thirds of income from operations compared with less than 20 per cent in the pre-restructuring period of 2008.

Net profit for the period amounted to $2 million against $4.1 million last time. Financial commitments and debt obligations were reduced by nearly two-thirds relative to the end of June 2009, reflecting efforts to constantly de-leverage the balance sheet.

Over the last 18 months, the bank has honoured an aggregate $18 million in creditor obligations, all of which were funded from internal accruals.

"We are very pleased with the pace of progress of the bank despite the regional and global uncertainties - a testament to the multi-faceted nature of its model and the successes of its new initiatives that also encompass lines of business with stable and recurring sources of income that are less susceptible to market cycles," added vice-chairman Shaikh Abdulla Al Sabah.

"The once predominantly private equity model has now been replaced with one with diverse asset classes. The major shareholders have made a capital contribution towards the bank's capital raising efforts - which further demonstrates shareholders commitment and confidence in the institution," Shaikh Abdulla added. – TradeArabia News Service