Muscat - For a third consecutive year, bank muscat and Al Omaniya Financial Services have emerged as the leading bank and finance leasing company, respectively, in the 2012 BusinessToday Best Banks and Finance Companies Survey. The survey was conducted in conjunction with Ernst & Young, which determined the financial ratios, rating all seven listed banks and six finance firms on various parameters.
Saleh Zakwani, executive chairman, Apex Press and Publishing, and Mohana Prabhakar, CEO, presented the awards to Abdulrazak Ali Issa, chief executive, bank muscat, and Aftab Patel, CEO, Al Omaniya Financial Services.
bank muscat's consistency in key parameters like net profit growth, efficiency and NPL to gross loans, at 2.99 per cent, are quite remarkable. Its return on capital is the best in the sector, and it is these factors that make it the most profitable player in the industry.
Non-performing loans have increased 16.5 per cent to RO173.7mn. Growth in total deposits in FY'12 slowed to 8.5 per cent from the 33 per cent increase in FY'11. Commenting on adopting measures to curtail the growth in non-performing loans, Issa said, "The bank has in place a well-tested rating model for corporate and counterparty bank exposures. With the introduction of rating models for project finance, SME lending and high net worth individuals, majority of bank's loan book is risk rated. Retail customers are also scored to validate risks."
The runner up among banks this time was BankDhofar, while Ahlibank and Bank Sohar moved up a notch each to occupy the third and fourth positions, respectively. Last survey's runner up Oman Arab Bank gets pushed down to the fifth spot, followed by National Bank of Oman at six and HSBC Bank Oman making an entry at seven.
The ranking among the finance leasing companies is similar to the trends seen in the 2010 survey. Al Omaniya Financial Services remains unconquered at the top as it exhibited the best performance across six categories. This includes top efficiency, consistent net profit growth with the best non-performing loans-to-gross loans ratio in the sector.
Speaking about the performance of Al Omaniya, Patel said, "Al Omaniya's high quality and high volume business, outstanding asset quality, significantly large capital adequacy ratio and our global scale rating by Moody's ensure that our cost of borrowing is benchmarked significantly lower. Hence our company is a preferred partner for the lending banks in Oman and the region. This ensures that our net margins are healthy."
Taageer Finance has stayed in the runner up spot for a second consecutive year while Muscat Finance edged up a notch to occupy the third position. Oman Orix went up two notches to fourth, a position it occupied two surveys back, while National Finance and United Finance Co are occupied fifth and sixth positions, respectively.
© Muscat Daily 2013
