MANAMA: Bank ABC has reported its consolidated net profit for the first nine months of 2018 was $159 million, five per cent higher compared with $151m reported for the same period of the previous year.
This shows improving operating performance and cost of credit despite external headwinds, said a statement.
Profit before taxation was $178m, 28pc lower compared with $247m in the nine months of 2017, and normalises to a positive 1pc growth, after adjusting for effects of foreign currency hedging transactions in Banco ABC Brasil, which have an offsetting tax charge impact and other one-off non-core items.
On a headline basis, total operating income was $592m against $653m reported for the nine months of last year, and normalises to 2pc growth year-on-year, after adjustments.
Earnings per share for the period remained stable at $0.05 compared with the same period of 2017.
Operating expenses were $352m, $13m higher than the nine months of 2017, mainly due to continuing investment costs into the new geographies and strategic initiatives whilst maintaining tight grip on the business as usual costs.
Impairment charges for the period were $62m compared with $67m reported for the same period last year, mainly indicating the generally improving market conditions in select markets where the group operates and largely in line with expectations for cost of credit.
Impairment for the period is now computed on IFRS 9 basis covering the entire portfolio.
Total comprehensive income was $24m compared with $196m reported for the same period of 2017, primarily due to depreciation in BRL against US dollar impacting the foreign exchange translation adjustments in equity.
Ratio of non-performing loans to gross loans increased to 4.3pc compared with 2017 year-end levels of 3.5pc, and normalises to 3.3pc, when legacy fully provided loans are adjusted for.
Provisions coverage of the impaired exposures remained comfortable at 98pc.
Tax credit (savings) were $19m, compared with charge of $53m for the nine months of 2017 (the variance largely arising from the tax treatment of currency hedges in Banco ABC Brasil).
Effective tax charge remains at comparable levels, after adjusting for the currency impact.
Consolidated net profit for third quarter was $46m, 6pc lower compared with $49m in Q3 2017.
Profit before taxation for the quarter was $59m, 34pc lower compared with $89m in Q3 2017, and normalises to 8pc reduction, after adjusting for effects of foreign currency hedging transactions in Banco ABC Brasil, which have an offsetting tax charge impact.
On a headline basis, total operating income was $203m against $221m reported for the same period last year, and normalises to 3pc growth year-on-year, after adjustment.
Impairment provisions for the quarter at $32m was higher compared to the third quarter of the previous year, although remained in line with targeted levels on a year-to-date basis.
Total comprehensive income was $38m compared with $80m reported for the same period of 2017.
Earnings per share for the quarter were $0.01, compared with $0.02 in the third quarter of the previous year.
Bank ABC’s group chairman Saddek Omar El Kaber said, “We are pleased with the core business performance as the year draws to its last quarter while we continue to retain focus on maintaining a strong balance sheet, with healthy capital and liquidity levels. Our strategic initiatives to build on our franchise strengths and transform the bank are progressing well. We have already started seeing the results of some of these initiatives.”
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