International Investment Bank (IIB), a globally focused investment bank based in the Kingdom of Bahrain operating in line with Shari'ah principles, today announced its results for the three months ended 31 March 2009.
Total Income for the first quarter was US$ 1.8 million, mainly derived from investment banking fees generated from the structuring, underwriting and placement of new investments, together with profit earned on funds placed with financial institutions. Total Expenses reduced to US$ 2.7 million in the period, reflecting the lower business activity as compared to a year ago. A Net Loss was incurred of US$ 0.9 million compared to a Net Profit of US$ 5.4 million earned in the same period of 2008. The decrease is mainly attributed to fewer investment banking transactions and lower profit rates applicable to bank placements as the Bank intentionally slowed down its investment activities as a measure of prudence during the current turbulent market situation.
Total Assets at 31 March 2009 were US$ 198.5 million compared to US$ 218.7 million at year end 2008. The decrease principally arises from the payment in 2009 of the 2008 dividend and fair value write downs on several available for sale investments.
Capital Adequacy Ratio was 86% as at 31 March 2009 versus the Central Bank of Bahrain's minimum requirement of 12%, demonstrating IIB's capacity to significantly increase its investment portfolio in the future from a regulatory capital perspective.
Commenting on the Bank's results, his Excellency Mr. Saeed Abdul Jalil Mohammed Al Fahim, Chairman of IIB, said: "Trading conditions in 2009 are very challenging for investment banks for two principal reasons. Many investors have incurred significant losses during the past 12 months on their regional and global portfolios and have been reluctant to commit to making new investments. However, we foresee an improvement in investors' sentiment during the second half of this year. Secondly, many regional banks have suspended the provision of Shari'ah-compliant financing of real estate development and private equity projects. During the current difficult global conditions, the Bank has adopted the strategies of prudent investing, strict liquidity management and capital protection. IIB's asset position demonstrates core strength with 52% of Total Assets represented by cash and short-dated murabaha placements with financially-sound regional banks with a further 15% invested in regional listed equities, giving a total liquidity position of 67%."
Commenting on the 2009 results, Mr. Aabed Al-Zeera, CEO and Board member said: "Our strategy has been to structure and market to clients a range of attractive investment offerings in the manufacturing, financial, energy and real estate sectors in various countries. During 2009, IIB has concluded the sell down of its investment in a sugar refinery to be built in the Kingdom of Bahrain. The Bank's "pipeline" of potential transactions continues to be strong and several deals are being evaluated for product launches expected later in the year. Due to the cyclical nature of the Bank's operations whereby revenues are closely linked to completed investment transactions, the performance in the first quarter is not reflective of the expected outcome for the remainder of 2009. IIB's balance sheet is strong, evidenced by the fact that it had no borrowings, off balance sheet commitments nor other exposures during the year."
For full details on IIB's financial results, please see the 'Financial Section' on IIB's website at www.iib-bahrain.com.
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About International Investment Bank
International Investment Bank B.S.C. (c) (IIB) was incorporated in Bahrain in October 2003 as an Islamic investment bank, with an authorized capital of US$ 200 million and a paid up capital of US$ 43 million. In December 2007, IIB concluded a combined rights issue and private placement offering that has increased the issued share capital to US$ 110 million and total shareholders' equity of US$ 191.7 million. The Bank's shareholders are high net worth individuals, business houses and institutions from the GCC states. The Bank undertakes two core business activities - private equity and real estate - and aims to offer its clients an internationally diversified range of investments generated through its network of strategic partnerships. It has been involved in investments worth USD 2.5 billion since its inception.
For more information on IIB, please visit: www.iib-bahrain.com
For more information, please contact:
Ghizlane Rahali
Associate -Corporate Communications and PR
Tel: (+973) 17565086
Fax: (+973) 17565050
© Press Release 2009
