Final Results
February 02 2009 - 1:00AM
UK Regulatory
TIDM89YE
RNS Number : 6089M
BBK (B.S.C.)
02 February 2009
BBK posts BD 27.1 million profit and maintains liquidity position above 25% of
the total assets, with capital adequacy ratio above 20%
The board of directors of BBK has met on Sunday 1st of February 2009 to review
and approve the financial results for 2008. Mr. Murad Ali Murad, Chairman of the
Board of Directors, announced that BBK posted a profit of BD 27.1 million
compared to BD 30.0 million in 2007. In conformity with the norms in the
industry, BBK has to prudently provide for provisions against certain financial
assets to respond to the adverse conditions in the global financial markets.
Besides the provisions of BD 46.9 million which have been taken against certain
investments, all other core activities reported a positive trend compared to the
previous year, resulting in profits from core business performance of BD 71.2
million, a growth of 51.0%, if compared to 2007. Net interest income grew by BD
6.4 million to reach BD 57.0 million, while non-interest income grew
impressively by 78.1% to BD 54.9 million, mainly driven by investment income of
BD 24.6 million, associated companies income of BD 3.2 million, foreign
exchange income of BD 4.3 million, and income from fees and commissions of BD
22.0 million.
The bank has reported a net profit of BD 7.0 million for its 4th quarter 2008
operations, compared to BD 4.3 million for the same period of 2007, mainly on
the account of interest, and investment income.
Although operating costs grew by 14.5% to accommodate the expense growth on
account of the recent staff incentive initiatives, further expansion of core
business activities and development of IT & premises infrastructure of the bank,
operating costs to income ratio of the core business activities improved from
37.8% in Dec 2007 to 31.5% in December 2008, which reflects the strong
underlying growth of core business.
After the opening of "City Centre" branch in October 2008, to improve service
and outreach to retail customers, BBK has recently opened its "Cash Management
Centre" at GOSI complex, as part of the bank policy to provide high class
service to its corporate customers. The Cash Centre will offer Corporations,
Small & Medium Enterprises, Government and Public Sector, and not-for-profit
entities a complete over-the-counter cash management services such as funds
transfers, deposits and encashment, through fully functional tellers. The bank
has also upgraded its ATM base to be compatible with the smart chip, in
compliance with regulatory requirements. Going forward, and as part of investing
in customer service enhancement, BBK largest Financial Mall will be opened soon
in West Riffa, along with three more financial malls in Isa Town, Hamad Town and
Exhibition Road.
The bank's balance sheet grew to BD 2,165 million, an increase of BD73 million
when compared to December 2007. The increase resulted from a strong underlying
business growth driven by the increase in net loans and advances by 20.1% to
reach BD1,354 million. Customer deposits also has grown by 19.6% million to
reach BD 1,337 million, despite signs of financial meltdown, reflecting the
customers' confidence in the bank.
As a result of following cautious and conservative approach to manage the
liquidity risk, the bank maintains a very comfortable liquidity position with a
liquid assets-to-total assets ratio above 25%, and a capital adequacy ratio
above 20%, well above the regulatory requirements.
Based on the above results, the Board of Directors has decided to recommend cash
dividends of 20 fils per share, and 1 bonus share for every 20 shares held.
Commenting on the Bank's results, Mr. Murad Ali Murad, Chairman, said
"Notwithstanding the exceptional provisions we had to make during 2008, we are
proud that the bank has achieved excellent core performance, in one of the most
difficult years in the global financial markets".
He also added "We are pleased that against the trend in the industry, ratings
agencies have maintained the main rating elements of the bank. Fitch Ratings
have maintained the Long Term IDR at A-, and the Short Term IDR at F2, while
Moody's has affirmed its ratings except for the change in A2 long-term foreign
currency deposit outlook, from stable to negative, following the change in
Bahrain rating ceiling on the same."
Mr. A.Karim Bucheery, CEO, said "2008 was arguably the most traumatic year in
global banking history, but we can look back on the period with quiet
satisfaction. While many banks struggled for survival, BBK is in the enviable
position of having achieved a good performance on behalf of shareholders. The
Bank made substantial provision for impairments arising from the global
financial crisis, which would have made 2008 results even more impressive" Also
he said "The professionalism of employees at all levels and across every area of
operations has shone through at all times, when their skills and resources were
examined as never before".
"Despite the uncertainties that still lie ahead, we are looking forward for the
coming period with proactive strategies and business plans, where we will
continue offering our valuable customers the best world-class services in the
financial industry", he added.
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The company news service from the London Stock Exchange
END
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