MANAMA: Gulf International Bank (GIB) reported a net profit of $12.8 million for the first quarter of 2022 attributable to the shareholders of the parent, compared with a net profit of $7.9m in the prior year period, an increase of 62 per cent due to higher net interest income and net fee and commission income.
The consolidated GIB Group recorded a net profit of $21m compared with a net profit of $14.1m in the same period last year, an increase of 49pc.
Total revenues of $109m for the three months were $18.4m or 20pc up on prior year with increases recorded in almost all revenue categories.
The year-on-year increase in the bank’s core revenue reflects the continued progress in implementing the bank’s strategic transformation plan.
Net interest income at $67.9m was 21pc higher than prior year, due to balance sheet growth and the stabilisation of markets resulting in higher yields.
Fee and commission income at $23.1m was 35pc up on the previous year, reflecting the continued success of the bank’s strategic revenue diversification initiatives.
Increases were recorded across asset management, corporate advisory, lending-related, global transaction-banking and retail fees.
Foreign exchange income at $4.7m was lower than the prior year period by 20pc as a result of lower volumes in anticipation of increased Fed rates and comprised revenues derived from customer-related activities, including structured products designed to assist customers in hedging their foreign exchange exposures in current volatile markets.
Trading income at $9.8m was in line with the prior year and comprised gains on investments in funds managed by the bank’s Saudi-Arabian based subsidiary (GIB Capital) and London-based subsidiary (GIB UK).
Other income of $3.5m for the three months was 94pc or almost double prior year levels due to a strategic and focused approach on monetising recoveries from previously written-off loans.
Total expenses at $74.4m for the three months were 13pc higher than the prior year period and reflects the bank’s continued investment in human capital.
The provision charge for the first quarter was $9.8m in line with the provision charge in the first quarter of 2021 and reflective of the bank’s prudent approach to risk management with NPL ratio reduced to 2.6pc as of March 31, 2022.
Basic and diluted earnings per share attributable to the shareholders of the bank of 0.51 cents compared to 0.32 cents per share in the prior year.
Total comprehensive income attributable to the shareholders of the parent of $29.4m compared with $23.3m in the prior year representing an increase of 26pc, driven by fair value gains on FVOCI investments, and a much improved 2022 performance.
Total shareholders’ equity excluding minority interest increased by 1pc during the year to reach $2.2 billion (December 2021: $2.1bn) and includes accumulated losses of $777.3m which represent 31pc of capital, and reserves of $452.1m which represent 18pc of capital.
Consolidated total assets at the quarter end were $33bn, up 4pc from December 2021 levels of $31.8bn.
Cash and other liquid assets, and short-term placements totalled $14.9bn (45pc of total assets), representing a continued high level of liquidity.
Investment securities principally comprised highly rated and liquid debt securities issued by major financial institutions and regional government-related entities amounted to $5.8bn at the end of the first quarter. Loans and advances amounted to $10.7bn, being $0.9bn or 8pc lower than at the 2021 year-end.
The bank’s funding profile remained robust in the first quarter of 2022 with customer deposits of $22.3bn comprising the majority of the bank’s deposit base.
GIB’s strong funding position demonstrates the confidence of the bank’s customers and counterparties, based on its strong ownership and financial strength.
This provides a stable platform for the growth expected in the remainder of the year and is reflected in the liquidity coverage ratio of 139pc and the net stable funding ratio of 142.6pc, both significantly above regulatory limits.
The Basel 3 total capital adequacy ratio at the quarter end was strong at 16.6pc.
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