HE Sheikh Saleh Abdullah Kamel, Chairman of Al Baraka Banking Group, said the Group continued its successful performance as evident by its ability to maintain its high quality of assets and strength of liquid assets, in addition to improve financial returns from all core businesses and at the same time keep up with its socially responsible Islamic banking model.
“The Group and its banking units are in a privileged position because they follow conservative approach in expansion in markets where they operate. They were able to overcome all the adverse financial and economic developments and continued expansions of branches and financing products programs, as well as serving further their communities,” Abdulla Ammar Al Saudi, Vice Chairman of ABG, said.
Al Baraka Banking Group has continued during the first quarter of 2017, the implementation of the business and markets expansion initiatives and diversification of income sources through its banking units located in 15 countries, and the operations and activities of the Group achieved a slight growth in total financing and investment activities, but operating income growth rates were affected by the financial and economic unstable conditions in some countries where the Group operates, forcing it to strengthen prudential provisions as part of the conservative policy pursued by Group, as well as those growth rates were affected by the decline in the local currencies in some countries where the Group operates against the US dollar. Therefore, net operating income, after deducting all operating expenses, reached US$ 101 million during the first quarter of 2017 lower by 11% when compared to US$ 114 million during the same period last year. After deducting taxes and provisions, the net income attributable to equity holders of the parent reached US$ 34 million during the first quarter of 2017 compared to US$ 38 million during the same period last year, a slowdown of 10%. While total net income of the Group reached US$ 52 million during the first quarter of 2017.
The beginning of 2016 saw some kind of stability in the values of the local currencies of a number of countries in which the group operates, but there was a large state of instability in the values of these currencies during the second half of last year, which affected the results of the first quarter of 2017. The Group believes that the results of the three remaining quarters of this year will witness an improvement in revenues and income, God willing.
After excluding the effect of the decline in the exchange rates of the countries the Group operating in against the US$, the total operating income will show an increase of 10% and the net income attributable to equity holders of the parent will show an increase of 4%.
The total assets of the Group as at the end of March 2017 maintained its same level of December 2016 and reached US$ 23.4 billion, where the growth rates of these assets were affected by the decline in value of local currencies in some countries where the Group operates against the US dollar, the currency of preparing the Group’s consolidated statements. The Group maintained a large portion of these assets in the form of liquid assets in order to seize the financing opportunities and to face the fluctuations in the markets.
Operating assets (financing and investments) amounted to US$ 17.7 billion as at the end of March 2017 compared to US$ 17.5 billion at the end of December 2016, an increase of 1%.
Customer accounts as at the end of March 2017 also maintained its December 2016’s level and reached US$ 19.1 billion, which indicates the continued customer confidence and loyalty in the Group.
Total equity reached around US$ 2.0 billion at the end of March 2017, increasing by 1% compared to end of December 2016 and equity attributable to parent’s shareholders reached US$ 1.3 billion, increasing by 1% compared to end of December 2016. As an indication of the strength of the capital base of the Group, the total equity to total assets ratio reached 9%.
Al Baraka Banking Group (B.S.C) is licensed as an Islamic wholesale bank by the Central Bank of Bahrain, listed on Bahrain Bourse and Nasdaq Dubai stock exchanges. It is a leading international Islamic banking group providing its unique services in countries with a population totaling around one billion. It is jointly rated BBB+ (long term) / A3 (short term) on the international scale and A+ (bh) (long term) / A2 (bh) (short term) on the national by Islamic International Rating Agency & Dagong Global Credit Rating Company Limited, and by Standard & Poor’s at BB+ (long term) / B (short term).
Al Baraka offers retail, corporate, treasury and investment banking services, strictly in accordance with the principles of the Islamic Shari’a. The authorized capital of Al Baraka is US$ 1.5 billion, while total equity is at about US$ 2 billion. The Group has a wide geographical presence in the form of subsidiary banking units and representative offices in fifteen countries, which in turn provide their services through over 702 branches. Al Baraka currently has a strong presence in Turkey, Jordan, Egypt, Algeria, Tunisia, Sudan, Bahrain, Pakistan, South Africa, Lebanon, Syria, Iraq and Saudi Arabia, including two representative offices in Indonesia and Libya.