This reflects a substantial improvement in the total income of the bank which amounted to BD12.09m, compared to BD8.25m during the first nine months of 2010, an increase of 46.54%. After deducting all operating expenses, net operating income amounted BD1.06m, which represents a drop of 22.35% down from its level during the same period of 2010.
The improvement in net income reflects an increase of the bank’s business in Bahrain and Pakistan, improvement in the quality of income-generating assets and a reduction in non-performing financing as well as an increase in income from foreign trade financing and from arranging financing deals.
The bank also announced an increase in total operating income by 46.54% and net income by 249% during the first nine months of 2011 compared to the same period of 2010. The statements also show that total assets have increased by 7.49%, finance and investments portfolio by 8.87% and total deposits by 8.52% as at the end of September 2011 compared to their levels in December 2010. These results are a testimony to the soundness of the Bank’s business strategy and to the growth of its activities in all areas of its operations, especially in its two key markets, Bahrain and Pakistan. The results are also a testimony to the steady improvement in the economic conditions of the kingdom.
The financial statements for the first nine months of 2011 also show that total assets have increased by 7.49% to BD545.7m as at the end of September 2011 in comparison with December 2010, as a result of growth in the bank’s business in Bahrain and Pakistan, which in turn was reflected positively on all key items of the balance sheet. Deposits and investment accounts increased by 8.52% to BD464.4m while the finance and investments portfolio has increased by 8.87% to BD427.7m as at the end of September 2011 compared to December 2010, as a result of arranging new finance transactions and increased financing of foreign trade and consumer finance. Total shareholders’ equity amounted to BD69.2m as at the end of September 2011.
As for the results of the third quarter of 2011, net income amounted to BD75 thousand compared to BD484 thousand for the same period in 2010, a drop of 74.5% as a result of an increase in operating expenses, while total operating income rose by 25.8% to BD3.69m during the third quarter of 2011 compared to the same period in 2010.
Meanwhile, the international well-known rating agency Capital Intelligence re-affirmed in early August 2011 the credit rating of Al Baraka Islamic Bank as it maintained its BB + rating for long-term foreign currency obligations and A3 for short-term foreign currency obligations with a stable outlook. According to the Agency, this rating reflects the good quality of the bank’s assets, its strong capital base, adequate liquidity and high capital adequacy ratio as well as the strong support that the parent company, Al Baraka Banking Group, affords to the bank.
Commenting on these results, Chairman of the Board of Directors of Al Baraka Islamic Bank Mr. Khalid Rashid Al Zayani said, “We are delighted to see continuing improvement in the performance of Al Baraka Islamic Bank in this year, which was a truly difficult year as unfavourable global and regional economic and financial conditions continues. These results were achieved firstly by the Grace of Allah, and then by the outstanding efforts made by the bank in expanding its activities and business at all levels based on the flexible and diverse business strategies that it had launched last year and which included a number of initiatives in the area of product diversification, expansion of branch network, enhancement of foreign trade financing and other initiatives that have had good impact on the results of the Bank during the first nine months of 2011. Also, the steady improvement in the performance of the Bahraini and Pakistani economies helped the Bank’s efforts in expanding its business and improving its financial results.”
For his part, Mr. Adnan Ahmed Yousif, Vice Chairman of Al Baraka Islamic Bank and President & Chief Executive of Al Baraka Banking Group, said that “The bank has continued during the past months to implement a series of initiatives that had clear positive effects on the Bank’s performance during the first nine months of 2011. The conversion of the Bank’s branches in Pakistan to an independent Islamic commercial bank following the merger with Emirates Global Islamic Bank in Pakistan and our hard work to turnaround these branches to profitability had an evident positive effect on the operations of Al Baraka Islamic Bank.As a result of the merger and thanks to the bank’s long experience in this market and the strong support that the parent company, Al Baraka Banking Group, affords to it, Al Baraka Islamic Bank was able to continue to expand and grow its operations in Pakistan in spite of the difficult economic conditions prevailing there. In Bahrain, we continued our concerted efforts to launch new products and services, open more branches, strengthen our capital resources and continue build the human and technical resources of the bank. All these factors had helped in achieving the good results of the Bank during the first nine months of 2011.”
Mr. Mohammed Isa Al Mutaweh, member of the Board of Directors and Chief Executive Officer of Al Baraka Islamic Bank, said, “During the first nine months of 2011, we have continued our efforts in expanding our business operations in Bahrain and Pakistan. In Pakistan our focus was in particular on strengthening the operations of the bank’s branches to turn them around to profitability, which made the bank the second-largest Islamic bank in Pakistan. In Bahrain, we concentrated on building fruitful business relations with major industrial and commercial companies in Bahrain with a view to providing them with products and services that meet their banking and finance needs, as well as enhancing our relations with government and quasi- government institutions and with banks and financial institutions. At the same time, we expanded our branch and ATM networks both in Bahrain and Pakistan.”
“We also focused on improving the work environment, enhancing and developing our relations with customers and launching many new financing and savings products. We turned much of our attention to the development of the Bank’s human resources and the hiring of skilled recruits to help the Bank in the implementation of its new business strategies. Furthermore, we introduced new IT systems to enable the Bank provide the most advanced banking services to its customers and increase its operational efficiency,” he added.
“Based on all these steps, we embarked upon a number of major initiatives in the area of finance and investment. We arranged a number of major finance transactions in which banks inside and outside the region had participated. In this regard, the bank has succeeded in signing memoranda of understanding with majorexporters in the Republic of India for finance Indian exports to African countries, in implementation of its ambitious plan to finance trade between India and African countries. The Bank is also working on arranging an Islamic financing deal of about $40m to finance the import of sugar to some Arab countries from a sugar- exportingcountry, and there are many more deals that will be arranged in the first quarter of 2012,” he said.
“As for our local branch network, we have in June 2011 celebrated the opening of the bank’s sixth branch in the Kingdom of Bahrain in Al Ramly Mall, Aali. Furthermore, we also started working on a plan to open two more branches next year, which highlights our determination to enhance our financing and deposit market share, considering that the bank has a range of highly successful financial and deposit products designed for individuals and companies which include many attractive features that best meet the needs of customers in strict compliance with Islamic Sharia,” he added.
Mr. Al Mutaweh added that “As for the ATM network, work is in progress to add five more ATM machines during next year, to bring the total number of ATMs to 16. The focus will be on installing stand- alone ATMs that are not part of branches of the Bank, with particular emphasis on drive-by ATMs. We also started working on implementing the Bank’s plan to launch e-banking services which include providing Internet banking and phone banking services. These services are expected to be available to customers by the end of this year.”
He added that “We are delighted by the reaffirmation of the credit ratings of the bank by Capital Intelligence, thanks to our substantial capital, technical and human resources and the fact that Al Baraka Islamic Bank is one of the most well-established Islamic banks in the Kingdom of Bahrain and the region and has accumulated extensive experience and understanding of the needs of the markets and customers, as well as the fact that we belong to a leading and strong banking group, and all these factors will again enable us achieve good performance in year 2011.”
Concluding their statements, Mr. Khalid Rashid Al Zayani, Chairman of the Board of Directors of the Bank, Mr. Adnan Ahmed Yousif, Vice Chairman of the Board and Mr. Mohammed Isa Al Mutaweh, Chief Executive Officer of the Bank expressed their sincere thanks to the Ministry of Industry and Commerce and the Central Bank of Bahrain for the cooperation and assistance they extended to the Bank. They also expressed their thanks to all of the investors and customers for their continuing support and custom and to the employees of the Bank for their loyalty and hard work.
Al Baraka Islamic Bank is one the subsidiary banking units of Al Baraka Banking Group. Al Baraka Banking Group (ABG) is a Bahrain Joint Stock Company listed on Bahrain Bours and Nasdaq Dubai stock exchanges. It is a leading international Islamic bank with Standard and Poors investment grade long term counterparty credit rating of BBB- / A-3 (Short Term) with a Negative Outlook. ABG offers retail, corporate and investment banking and treasury services strictly in accordance with the principles of the Islamic Shari’a. The authorised capital of ABG is $1.5bn, while total shareholders’ equity amounts to about $1.8bn. The Group has a wide geographical presence in the form of subsidiary banking Units and representative offices in twelve countries, which in turn provide their services through more than 400 branches. These banking Units are Jordan Islamic Bank, Al Baraka Islamic Bank Bahrain, Al Baraka Bank Pakistan Limited; Banque Al Baraka D’Algerie, Al Baraka Bank Sudan; Al Baraka Bank Limited, South Africa; Al Baraka Bank Lebanon; Al Baraka Bank Tunisia; Al Baraka Bank Egypt; AlBaraka Turk Participation Bank, Al Baraka Bank Syria and representative offices in Indonesia and Libya (under formation).
Wednesday, November 16- 2011 @ 14:20 UAE local time (GMT+4) Replication or redistribution in whole or in part is expressly prohibited without the prior written consent of Mediaquest FZ LLC.