Bank Muscat, Oman’s largest lender, announced on Monday a rise in first quarter (Q1) earnings for the current year, in line with analysts’ forecasts.
The bank reported a net profit of 45.8 million Omani rials ($118,96 million) for Q1 2019, compared to 44.81 million rials in Q1 2018, translating into a 2.21 percent increase.
The bank’s net interest income from conventional banking and income from Islamic financing rose 9.63 percent year on year, to 78.76 million rials in Q1 2019, compared to 71.84 million rials in Q1 2018.
“The bank has posted a good set of results, which meets our expectation,” Ayisha Zia Hassan Naseer, research analyst at Ubhar Capital, told Zawya by email.
Bank Muscat’s total deposits (conventional customer deposits + Islamic deposits) dropped 4.97 percent quarter-on-quarter (QoQ) to 8.04 million rials in Q1 2019, from 8.46 million rials in Q4 2018.
“Management had indicated in the Investor & Analyst Conference for FY2018 (fiscal year 2018) results that some deposits booked in Q4’18 were fleeting in nature, and will not be there in Q1’19. Therefore, the 5 percent QoQ deposit decline was expected,” Naseer said.
The bank’s shares closed mainly flat on Monday at 0.402 rials, but have increased in value by 4.48 percent since the start of the year, according to Eikon.
In its latest report on Bank Muscat, Ubhar Capital revised its 12-month target price (TP) for the bank to 0.470 rials per share down from an earlier TP of 0.480 rials per share, citing a “revision in cost of equity”. Ubhar Capital maintained its rating at “ACCUMULATE”, anticipating a gain in the stock's value of between 10-20 percent.
(Reporting by Gerard Aoun; Editing by Michael Fahy)
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