National Bank of Bahrain net profit rises 8.8%

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MANAMA: National Bank of Bahrain (NBB) has reported an 8.8 per cent increase in its net profit attributable to equity shareholders at BD14.9 million for the second quarter, compared to BD13.7m in the same period of 2020.

The increase in net profit is predominantly due to higher net interest income due to higher loan volumes and following the active repricing of the group’s balance sheet in line with recent interest rate trends, higher cross-sell FX activities and increased realised gains following the effective and active management of the investment securities book.

Basic and diluted earnings per share increased to 8 fils for Q2-2021 compared with 7 fils in the same period of 2020.

Total comprehensive income attributable to equity shareholders for the quarter decreased by 73.2pc to BD11m compared with BD41.1m in the same period of 2020.

The decrease is predominantly attributable to the mark-to-market movements of the Bahrain Sovereign bond portfolio.

Operating income increased by 10.8pc in the second quarter of 2021 to BD37.9m compared with BD34.2m in the prior year period.

The increase is largely due to higher net interest income due to higher loan volumes and following the active repricing of the group’s balance sheet in line with recent interest rate trends, higher cross-sell FX activities and increased realised gains following the effective and active management of the investment securities book.

For the first half of the year (H1), NBB has reported a 4.8pc increase in its net profit attributable to equity shareholders to BD30.5m, compared to BD29.1m in the same period of 2020.

The increase was attributable to the increased cross-selling activities and effective management of the investment securities book.

Basic and diluted earnings per share at 16 fils during the period remained at the same level of the same period of 2020.

Total comprehensive income attributable to NBB’s equity shareholders for the period increased to BD27.1m compared with BD1.8m in the same period of 2020.

The increase is predominantly attributable to the mark-to-market movements of the Bahrain Sovereign bond portfolio.

Operating income for the period increased by 3.1pc to BD76.8m compared with BD74.5m in the prior year period, due to the group’s increased cross-selling and investment portfolio management activities.

Total equity attributable to owners decreased by 1.6pc to BD511.2m compared with BD519.7m recorded as of end-2020.

The decrease followed the distribution of the 2020 cash dividends, slightly offset by the profits recorded during H1-2021.

Total assets increased by 6.7pc to BD4,655.5m compared to BD4,361.4m recorded on end-2020.

The increase was attributable to higher placements and a continued strong demand for NBB loan products.

Chairman Farouk Almoayyed said: “We are very pleased with our overall financial results for the second quarter of the year, which demonstrate positive growth despite the effects of the pandemic on the global economic environment. Our net profits have shown an increase from the same period in 2020, as the group’s balance sheet remains strong. The NBB Group has had a number of firsts during the quarter, as it deployed the first virtual Cyber Fusion Centre (vCFC) in the region to fortify the cybersecurity. This quarter also saw NBB bolster its sustainability agenda, as the group continues on its journey towards adopting a more sustainable approach in accordance with international ESG standards and best practices.”

Jean-Christophe Durand, chief executive of NBB, said: “Financial performance during the second quarter of the year has been strong, with operating profit for Q2 being 12.4pc higher than the same period in 2020, and loan and deposit volumes increasing by 4pc and 5pc respectively compared to the 2020-end level. This was despite the unstable market conditions not only across the kingdom, but also the world, and which have impacted all banks and companies directly or indirectly. Our strong positioning in the market enabled us to expand our product and services portfolio by strengthening our partnerships to enhance our performance.”

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