Bahrain-based Securities & investment Company (Sico), a leading conventional wholesale bank, has posted a net profit of BD1.32 million ($3.34 million) for the first quarter (Q1) of 2017 compared with BD30,000 for Q1 2016.

With higher revenues being generated by all business lines, operating income grew by 121 per cent to BD2.90 million from BD1.31 million a year earlier. Total operating expenses, which include staff overheads, general administration and other expenses, increased marginally to BD1.39 million from BD1.37 million. Earnings per share were Bahraini fils 3.07 compared with 0.07 fils for the first three months of 2016.

Shaikh Abdulla bin Khalifa Al Khalifa, chairman, said: “Sico achieved an overall encouraging financial performance for the first quarter of the year, despite mixed performance across markets and variable liquidity conditions.  Significantly, all business lines revenues posted positive growth, and increased their respective contributions to the bottom line.

“The bank reinforced its leading position in Asset Management with AUM continuing to grow quarter on quarter, reflecting clients’ enduring trust in Sico’s ability to outperform in different and complex markets. Brokerage and investment banking maintained their local market dominance, completing significant transactions in the first quarter, and winning new mandates which we expect to close later in the year.”

The results reflect a significant increase in net investment income, which closed the period at BD1.22 million compared with a loss of BD68,000 a year earlier. All other income lines also posted income growth: brokerage and other income BD583,000 (1Q16: BD519,000), net fee and commission income BD676,000 (1Q16: BD604,000), and net interest income BD269,000 (1Q16: BD215,000).

As at March 31, 2017, total balance sheet footings stood at BD141.94 million compared with BD147.06 million at the end of 2016. Assets under management increased to BD419.35 million ($1.11 billion) from BD395.90 million ($ 1.05 billion) at the end of the previous year. Assets under custody with the bank’s wholly-owned subsidiary – Sico Funds Services Company (SFS) – grew to BD2.06 billion ($5.47 billion) from BD1.95 billion ($5.17 billion) at the end of 2016.

Sico continued to maintain a strong capital base, ending the period with shareholders’ equity of BD57.34 million (end-2016: BD58.08 million), net of BD2.14 million dividends for FY2016 distributed during the first quarter of 2017; and a very strong consolidated capital adequacy ratio of 57.93 per cent.

Najla Al Shirawi, chief executive officer of Sico, said: “The majority of GCC markets posted a muted performance during the period, due mainly to weak quarter four 2016 earnings, with the S&P GCC Composite Index (total return) increasing 0.9 per cent. Kuwait and Bahrain were the exception, with gains of 22.3 and 11.1 per cent respectively, led by higher turnover and investor interest.”

“Sico’s business lines enjoyed an active first quarter. Highlights include Corporate Finance acting as Financial Advisor for the mandatory offer by Bahrain Kuwait Insurance Company for Takaful International Company; and also as Escrow Agent for the mandatory offer by AN Investments for all outstanding shares of Bahrain Middle East Bank.

“Asset Management maintained its robust growth trend, with total AUM increasing by 6 per cent to over $1.1 billion, with all Sico funds performing strongly against their respective benchmarks and peers. In addition, Fixed Income reported record trading revenues, and expanded its structured products portfolio. Notably, the Bahrain Liquidity Fund, for which Sico is the Fund Manager, continued to meet its objectives of increasing the liquidity and depth of the Bahrain Bourse; as the average traded value tripled during the first quarter of 2017, with the Fund contribution reaching 45 per cent of the overall traded value,” she added. – TradeArabia News Service