National Bank of Bahrain (NBB) has registered an 8.1 per cent increase in net profit to BD51.36 million ($136.60 million) for last year, compared with BD47.50 million in the previous year.

For the fourth quarter of last year, net profit grew 7.6 per cent to BD11.27 million from BD10.47 million for the corresponding period of the previous year, reported the Gulf Daily News, our sister publication.

The earnings per share improved from 50.5 fils in 2012 to 54.6 fils last year.

The financials were approved by the bank's board during a meeting yesterday.

"The strong results demonstrate successful implementation of strategies in the interest of all stakeholders," chairman Farouk Almoayyed said.

Director and chief executive Abdul Razak Al Qassim said the record profitability achieved during the year was a clear reflection of the bank's strength in generating steady revenue streams while efficiently managing operating costs in addition to containing loan loss provisions.

Net interest income for last year at BD59.82 million decreased 3.4 per cent from the previous year's level due to lack of growth in commercial lending opportunities and reduced returns on surplus liquidity due to low short-term interest rates.

Higher exchange income and realised profit on investments has been partly off-set by lower commission and dividend income on the bank's equity investments, resulting in a modest growth of 0.6 per cent in other income which stood at BD24.83 million.

Operating expenses continue to be carefully managed resulting in a marginal increase of 0.4 per cent compared with the previous year.

An amount of BD5.28 million was set aside towards loan loss provision to further strengthen the balance sheet.

Tax expense amounting to BD0.21 million represents tax on the income of one of the overseas branches based on applicable tax regulations.

The total balance sheet of the bank stood at BD2,749.23 million as at December 31 last year compared with BD2,654.56 million as at the previous year's-end.

Customers' deposits continued to show steady growth and stood at BD2,083.54 million as of December 31 last year. Total earning assets grew 3.2 per cent to BD2,596.84 million from BD2,515.83 million as at the previous year-end.

Capital adequacy ratio remains at 31.2 per cent before the proposed appropriations.

"The bank has a well-diversified asset composition with strong liquidity," Al Qassim added.

The board has recommended cash dividend of 35 per cent for the year as against 25 per cent for the previous year.

The directors also propose to make donations and contributions amounting to BD2,568,158.

Based on the current market price, the above results in a dividend yield of 4.8 per cent.

Total shareholders' equity before last year's appropriations stands at BD363.14 million.

The appropriations to donations and contributions will bring the total allocation under the programme to BD34.34 million since the bank's inception in 1980.

"During the year, the bank disbursed BD0.95 million for several worthy causes in Bahrain," Al Qassim said.

"With a strong capital base, adequate liquidity and the largest distribution network, the bank is well positioned to capitalise on increased business opportunities against the backdrop of an anticipated recovery in the global and domestic economy.

"We reaffirm our strong commitment to meet the expectations of our customers while reassuring our shareholders of continued progress in the years ahead," he added. – TradeArabia News Service