Al-Roshood: Double-digit profit growth confirms KFH`s strong financial position

• Keeping up with the latest developments in global banking digitization
• Balanced and strong performance reflects prudent approach in managing the economic repercussions
• Net profit grew 12.9% to KD 50 mn
• Net financing income increased 5.3% to KD 153.6 mn

Kuwait: Acting Group Chief Executive Officer at Kuwait Finance House (KFH), Abdulwahab Al-Roshood, said that the positive financial indicators achieved by KFH in Q1 2021, despite the exceptional economic conditions, and the double-digit net profit growth at 12.9%, confirm its solid financial position and credit worthiness as well as its high efficiency in dealing with fluctuations. 

In an interview with CNBC Arabia TV, Al-Roshood added that net financing income increased 5.3% to KD 153.6 mn, the cost to income ratio for the Group stabilized at 37.3%, down from 51.3% in 2014, financing portfolio increased 1.1% to KD 10.9 bn, and deposit accounts stabilized at KD 15.3 bn. 

Al-Roshood pointed out that the Group total provisions and impairment charge decreased 25% to KD 56 million, including Financing, investment and other provisions.

He explained that due to the pandemic and its negative repercussions on local and global economy, KFH`s exiting deals reached only KD 6.7 million as of the end of Q1 2021.

Al-Roshood added that exiting from non-strategic investments is part of KFH strategy that focuses on core banking business and sustainable profits.

He added that the Group’s non-performing financings decreased to 2.47% as of the end of Q1 2021, as per the CBK’s accounting principles. Total debt coverage ratio stood at only 220% and 206.8% for KFH solo and the Group respectively as of the end of the first quarter of 2021.

As for the contribution of KFH subsidiaries in the Q1 net profit, Al-Roshood said that their contribution until end of Q1 2021 reached 35.4%, whereas KFH-Turkey’s contribution was 35 percent compared to 23.3%.

He added that financing receivables as of the end of the first quarter of 2021 reached KD 10.870 bn, i.e. an increase of 1.1% compared to end of year 2020, most of the growth was achieved in the corporate sector.

KFH reported net profit of KD 50.0 Million for the first quarter of 2021 for KFH shareholders, an increase of 12.9% compared to the same period last year. Earnings per share for the first quarter of 2021 reached 5.97 fils; an increase of 12.6% compared to the same period last year. Total operating expenses for the first quarter of the year dropped by 6.5% compared to the same period last year. The capital adequacy ratio reached 16.98% which is above the minimum limit required by regulators, confirming the solid financial position of KFH.

The Q1 results of KFH reflect the balanced and strong performance of the Group and the prudent approach in managing risks and dealing with changes and different economic repercussions.

KFH continues its leading national role in the economy and society as part of its sustainable development strategy, supporting the growth of Islamic finance industry in the markets it operates in. In addition, KFH keeps focusing on its digital transformation strategy and its proactive approach to adopt technology and innovation and reinforce customer experience through delivering the best innovative banking solutions in collaboration with FinTech, employing AI and robots, and keeping pace with developments in the global banking industry.

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© Press Release 2021