Bahrain: Bank ABC Islamic posts solid growth in 2022; net profit up 30%

PHOTO

Bank ABC Islamic has delivered robust performance in 2022, closing the year with net profit of $38.8 million, representing 29.8% improvement year-on-year from $29.9 million in 2021.

Announcing its results for the year ending December 31, 2022, ABC said its net profitability as well as total operating income saw double digit growth compared to last year.

Its net operating income before credit losses soared to $46.1 million, 15.3% higher than $ 40 million reported last year, stated the bank in a statement.

Allowances for credit losses for the year were a claw back of $1.7 million compared to $1.1 million charge reported during the same period last year, it stated, adding operating expenses of $8.6 million stood at the same level as of 2021.

High profit rate environment and stable performance of client business resulted in 15.3% growth in Total operating income compared to last year.

The Bank performed very well in 2022 and has been recognised as the MENA Islamic Finance Bank of the year by MEED, for its innovative approach to Shari’a compliant banking and consistent performance with a clear client-centric focus.

Recognizing the Bank’s performance, the Islamic Rating Agency (IIRA) reaffirmed the rating of Bank ABC Islamic at A-/A-2 on the international scale and A+(bh)/A-1(bh) on the national scale with a stable outlook, based on the results of September 2022.

On its Q4 performance, the Bahrain-based bank said its net profit rose to $9.1 million in 2022 from $3.2 million reported in the fourth quarter the year before, while its net operating income before credit losses stood at $14 million compared to $8.8 million in 2021.

Allowances for credit losses for the period were a charge of $2.4 million compared to $2.0 million reported during the same period last year.

Bank ABC Islamic said operating expenses were $2.4 million, compared to $3.5 million for the same period of last year.

Its total assets stood at $2.415 billion as of December 31, 2022, compared to $2.332 billion at 2021 year-end, it added.

Commenting on the results, Managing Director Hammad Hassan said: "We are pleased with the bank’s performance in 2022. Steady customer business, effective utilization of the balance sheet resulting in healthy income from asset distribution and higher profit rate environment contributed to a year-on-year increase in total operating income of 15.3%."

While the bank's investments were at $882 million, compared to $852 million at 2021 year-end.

Murabaha receivables and Ijarah were at $1.5 billion, compared to $1.4 billion at 2021 year-end.

Shareholders’ equity on December 31, 2022, stood at $330 million, compared to $297 million at 2021 year-end, 11.3%.

The bank’s capital base remains strong with a capital adequacy ratio of 40.9%, predominantly Tier 1, which totalled 39.9%.

"Effective cost management and an improved credit environment further enhanced the net profitability for the Bank resulting in 29.8% increase in profit compared to last year. We are cautiously optimistic on the outlook for 2023 in the backdrop of an inflationary and higher rate environment,” he added.