Liquidity Management Centre (LMC) has announced an 18 per cent increase in the net profit at $4.22 million for last year when compared with $3.57 million for 2013.

This resulted in a return on capital equivalent to approximately eight per cent while the average one-year interbank rate remains below 0.75 per cent, said a report in the Gulf Daily News (GDN), our sister publication.

Total operating income was $10.11 million as against $10.57 million for 2013.

Net profit for the fourth quarter was $847,000 versus $784,000 for the same period in 2013.

Chairman Abdul Wahab Al Rushood said the results demonstrate the bank's ability to perform in challenging conditions whilst continuing with a conservative approach in the current market environment towards impairment provisioning in line with regulatory requirements.

"The net income achieved was due to astute investment banking activities, specifically opportunistic and perceptive investment returns made from a well managed portfolio of sukuk and equities with a diversified and balanced investment approach and fee income earned from bank's advisory services," he added.

Portfolio-based activities saw a growth of approximately 13 per cent while the bank's balance-sheet continues to see significant improvement in terms of asset quality and liquidity.

Shareholders' equity grew by 7.18 per cent from $62.96 million as of 2013-end to $67.48 million as of December-end last year.

LMC chief executive Ahmed Abbas said although a challenging environment lay ahead, the year may continue to present opportunities to alert investors and positive growth may be obtained if volatility levels are taken into account.

"The current economic conditions and financial markets are expected to slowly stabilise with the GCC markets taking longer due to the fact that oil prices are expected to become stable on average between $60-$70 per barrel over the coming three years.

"The drop in oil prices has put pressure on the average price anticipated by many GCC fiscal budgets for 2015 resulting negatively upon the sovereign ratings.

"Based on the track record and current performance along with the continued shareholder support and experienced management team, we believe that we are well prepared for the coming year," he added.

The shareholders of the Bahrain-based company are Bahrain Islamic Bank, Dubai Islamic Bank, Islamic Development Bank and Kuwait Finance House Investment Company - a wholly owned subsidiary of Kuwait Finance House. - TradeArabia News Service