Manama: Bank ABC yesterday announced consolidated net profit of $144 million for the first nine months of the year.
In a statement, the bank said profit was 27 per cent lower than the $197m profit figure for the same period last year.
Net profit for the third quarter was $48m, 20pc lower than the $60m reported for the same period last year.
The external headwinds arising from volatile trading conditions combined with strong US dollar against domestic currencies in which Bank ABC operates continued unabated during the third quarter.
Notably, the Brazilian real weakened more than 27pc and the Algerian dinar weakened by over 19pc during the first nine months of the year compared with the same period in the previous year.
The group also benefited last year from exceptional items that did not recur.
However, the underlying businesses continue to show resilience in the face of challenging circumstances with sustained performances in local currency terms.
This resulted in total operating income of $142m for the third quarter, compared with $208m reported for the same period last year.
Operating expenses were 8pc lower at $99m compared with $108m last year, benefiting from currency movements while reflecting additional cost investment in strategic initiatives to support sustainable business growth.
Net impairment provisions for the third quarter at $18m were higher than the previous year’s $13m.
However, the cumulative net provision charge of $40m for the nine-month period was at the same level as last year.
Tax saving for the period was $38m against a charge of $10m last year, benefiting from the tax treatment of currency movements in subsidiaries.
Bank ABC Group’s total assets stood at $28.6 billion at the end of the first nine months as against $29.4bn at the end of last year, also affected primarily by the stronger US dollar.
The underlying businesses broadly remained on a growth trajectory, as the asset volumes grew in domestic currency terms in most businesses.
The ratio of NPLs (non-performing loans) to gross loans at 2.5pc remains healthy (2.4pc at last year’s end).
Deposits proportionately decreased by $900m during the period to reach $18.7bn, again impacted by currency translation but to some extent offset by growth in deposits.
The group’s liquidity position continues to be at comfortable levels with the liquid assets-to-deposits ratio marginally increasing to 66pc compared with 65pc at last year’s end.
Shareholders’ equity as of September 30 stood at $3,724m after the distribution of 5pc dividend to shareholders and after foreign exchange movements on investments in subsidiaries.
Bank ABC’s consolidated total capital adequacy ratio (CAR) continued to remain strong at 19.8pc, comprising predominantly tier 1 at 17.5pc.
The total CAR, calculated in accordance with the Central Bank of Bahrain’s Basel III equivalent rules introduced this year, remains well above the regulatory minimum of 12.5pc.
Bank ABC chairman Saddek Omar El Kaber said challenges posed by the external environment in a number of key markets have clearly affected the results during the year.
“However, the bank’s capital and liquidity position continue to remain strong, with healthy asset quality.
“A number of measures and initiatives are underway with associated cost investments to diversify and enhance earnings capability.”
Bank ABC is a leading player in the region’s banking industry and provides innovative wholesale financial products and services that include corporate banking, trade finance, project and structured finance, syndications, treasury products and Islamic banking.
It also provides retail banking services through its network of retail banks in Jordan, Egypt, Tunisia and Algeria.
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