Arab Bank’s net profit up 10% to $360.3m in 1HJordan-based Arab Bank Group reported a net profit after tax and provisions of $360.3 million for the first half of the year 2012 compared to $ 327.2 million for the same period in 2011 showing a growth of 10%.
Abdel Hamid Shoman, Chairman of Arab Bank, said that the growth in net income comes was a result of a healthy increase in net interest income, gains from financial assets as well as lower provisions on doubtful debts, and added that the sustained growth in operating revenues reflects the bank’s underlying strength and its ability to take advantage of its diversified global network.
Arab Bank Group also managed to maintain its loan portfolio at $22.2 billion at the end of June 2012 and to grow its customer deposits to $32.1 billion. The growth in the rate of the customer deposits would have been greater had it not been for the decline in the exchange rate of certain major currencies against the US Dollar.
Nemeh Sabbagh, Arab Bank’s CEO said that the group continues to maintain a high quality loan portfolio and a provisions coverage ratio for non-performing loans of 100% as of June 30th 2012. The group’s capital adequacy ratio stands at 14.81% which is higher than the Central Bank of Jordan’s minimum requirement of 12% and well above the Basel Committee’s minimum requirement of 8%. Liquidity, always a strong hallmark of the bank, continues to be very strong as reflected in the loan deposit ratio of 69.2%.
The bank was able to grow its operating revenues and at the same time to control its expenses which grew by only 1%.
Shoman added that these results were testimony to the bank’s success in dealing with the challenging regional and international environment and to the bank’s conservative and prudent policies.
Also testimony to the bank’s solid financial standing, Fitch affirmed the rating of Arab Bank at A- with a stable outlook.
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