MANAMA, BAHRAIN – 10 August 2016 – Ithmaar Bank, a Bahrain-based Islamic retail bank, reported today (ed note: 10/08/16) a net profit of US$11.96 million for the first half of 2016, an 8.3 percent decrease compared to the US$13.04 million net profit reported for the same period last year. Net profit attributable to equity holders of the Bank for the first half of 2016 was US$4.40 million, a 22.2 percent decrease compared to the US$5.66 million net profit reported for the same period last year.
Net profit for the three month period ended 30 June 2016 amounted to US$7.14 million, a 31.7 percent increase from the net profit of US$5.42 million reported for the same period last year. Net profit attributable to equity holders of the Bank for the three month period ended 30 June 2016 was US$3.19 million, an increase of 5.7 percent compared to the US$3.02 million net profit reported for the same period last year.
The announcement, by Ithmaar Bank Chairman His Royal Highness Prince Amr Al Faisal, follows the review and approval, by the Board of Directors, of the Bank’s consolidated financial results for the six-month period ended 30 June 2016.
“On behalf of the Board of Directors, I am pleased to announce that Ithmaar Bank has reported profits, and that the Bank’s core retail business continues to perform well,” said HRH Prince Amr. “The financial results of the first half of 2016 indicate that the Bank’s operating income remains stable, at US$132.66 million, and that total expenses, at US$95.99 million, remain unchanged despite continued expansion of the Bank’s retail network,” he said.
Ithmaar Bank Chief Executive Officer, Ahmed Abdul Rahim, said the Bank continues to work towards becoming one of the region’s premier Islamic retail banks, and remains focused on growing closer to its customers.
“I am pleased to report that the balance sheet continues to be stable, and that our core business as well as our customer accounts continue to grow,” said Abdul Rahim. “This is evident from the equity of unrestricted investment account holders growing to US$2.36 billion as at 30 June 2016, an 8.2 percent increase compared to US$2.18 billion as at 30 June 2015, and a 7.2 percent increase compared to US$2.20 billion at 31 December 2015,” he said.
“This increase, a testimony to continued customer confidence, is further evidence that the Bank’s efforts to grow continuously closer to its customers is paying off,” said Abdul Rahim. “Current accounts and due to investors, for example, grew to US$3.58 billion as at 30 June 2016, a 1.8 percent increase compared to $3.51 billion as at 30 June 2015, and a 5.6 percent increase compared to US$3.39 billion as at 31 December 2015. Liquid assets now represent 10.5 percent of total assets compared to 10.6 percent as at 31 December 2015,” he said.
As part of its focus on continuously growing closer to its customers, Ithmaar Bank inaugurated a new full-service branch in the Galali neighbourhood of Muharraq last month, increasing the total branches in Muharraq alone to four. The new branch brings Ithmaar Bank’s network to 18 branches and 48 ATM machines, making it one of the widest distribution channel networks amongst banks in Bahrain.
Earlier this year, at the Bank’s Annual General Meeting (AGM), shareholders approved plans for a new group structure designed to further develop the growth achieved in the core retail banking business and the strategic focus of the Bank.
The plans involve the creation of a new holding company that will be listed on Bahrain Bourse and Kuwait Stock Exchange and licensed and regulated by the Central Bank of Bahrain (CBB). The new holding company will retain 100 percent ownership of all assets presently owned by Ithmaar Bank. These assets will be allocated into two wholly owned subsidiaries, an Islamic retail bank subsidiary which will hold the core retail banking business, and an asset management subsidiary which will hold the investment assets. These two subsidiaries will also be licensed and regulated by the CBB. This new group structure will further consolidate Ithmaar Bank’s position as a strong retail-focussed premier Islamic retail bank under the Ithmaar brand, better allowing the Bank to take advantage of new growth opportunities, and help to generate greater value to its shareholders.
Ithmaar Bank is now working with regulators towards finalising necessary legal and other requirements ahead of anticipated implementation later this year.