Al Baraka Bank Egypt, a subsidiary of Bahrain-headquartered Islamic banking major Al Baraka Banking Group (ABG), said that it had achieved a 35% increase in net income in year 2012. Total assets also increased by 13%, financing and investments by 14% customer deposits by 15% and shareholders equity by 17% at the end of 2012 compared to the end of 2011.
The Bank’s financial statements for year 2012, shows that the total income stood at 619.3 million LE, increasing by 22% compared to 2011. After deducting all operating expenses, the net operating income increased by 18% to 364.9 million LE in 2012. After deducting provisions and taxes, net income stood at 141.7 million LE (US$ 23.3 million) in 2012, increasing by 35% compared to 2011.
On the balance sheet side, total assets of Al Baraka Bank Egypt stood at 16.8 billion LE (US$ 2.7 billion) as at the end of 2012, an increase of 13% compared to 2011. This growth was reflected positively on total financing and investments, growing by 14% to reach 14.7 billion LE (US$ 2.4 billion) by the end of 2012. These increases in assets were financed by 15% increase in customer deposits including IAH to reach 15 billion LE (US$ 2.4 billion), funding 90% of total assets which reflects the solid customer base of the bank. The Bank also enhanced its shareholders equity by 17% to reach 1.2 billion LE (US$ 186.5 million) as at the end of 2012.
“The political, economic and social transitions continued in Egypt last year, which created changeable and unstable investment environment. Despite this, the Bank was able, by the grace of Allah Almighty and thanks to large efforts of the executive management and all employees of the Bank, to achieve distinguished operating and earning results in 2012,” Adnan Ahmed Yousif, Chairman of the Board of Directors of Al Baraka Bank Egypt and President and Chief Executive of Al Baraka Banking Group, said.
“Al Baraka Bank Egypt was able to firmly establish itself as an outstanding Islamic bank in the banking sector in Egypt in a short timeframe of just few years, thanks to the range and quality of its services, the many savings and investment products that suit the needs of all groups and segments of the community and innovative and unprecedented financing schemes designed to meet the needs of the different sectors of the Egyptian market, all in strict compliance with the principles of the Shari’a. In order to further strengthening these programs, the Bank added to its network one new branch in 2012 in Al Azhar, bringing the total to 27 branches and foreign exchange bureaus. During the year it introduced a new savings product on which return is paid on a daily basis. At the end of the year it also announced the issue of an Al Baraka US Dollar Islamic Sukuk, similar to the successful 10-year Egyptian Sukuk issued in 2011,” he added.
The Bank also launched, in cooperation with one of the biggest religious tourism companies, a facility for financing Hajj and Umrah trips with repayment in installments following the visit, the first such product of its kind in Egypt. This was followed by a new Shari’a compliant product to finance timeshare leasing, in cooperation with the biggest real estate company in the sector. It was pleased to announce the signing of an Islamic Musharaka contract with the Social Fund for Development through the World Bank, in the amount of 200 million LE, for financing small and medium-sized enterprises.
“Despite the difficult economic conditions in Egypt, the Bank implemented strategies and policies of the Board of Directors and its plans aiming at continued growth of activity, the size of the business and diversity and multiplicity of profitable centers, and to move forward in maximizing commissions, other income and banking services. In addition, these plans aimed at cautious expansion in retail financing operations due to current events, as well as financing small projects in collaboration with the Social Fund and enter into joint financings with major local and international banks for viable strategic mega-projects. The Bank was able, thanks to the Almighty, to increase its share in the Egyptian banking market in terms of both financing and deposits, relying on good performance, customer satisfaction, efficient management of funds, modern products portfolio, Islamic identity, and its affiliation to Al Baraka Banking Group (ABG), the leading Islamic banking group in the region,” Adnan Yousif said.
“The Egyptian economy’s growth rate recovered slightly in 2012 but still low at 2.2%. The new government has signaled that it is unlikely to deviate significantly from previous economic policy including a long term economic reform program, with the budget for fiscal year to June 2013 maintaining an emphasis on social equality, including increased spending on wages and benefits. In the light of continuing uncertainties, Al Baraka Egypt responded to a national rise in defaults in the retail banking sector by adopting a conservative and very selective policy towards new business,” Ashraf Al Ghamrawi Chief Executive Officer and Vice Chairman of the Board of Directors of Al Baraka Bank Egypt said.
“Within it branching and geographical expansion plans in order to support its presence in the Egyptian banking market, the Bank plans to open 4 new branches in 2013 to bring the network total up to 31. Its rolling program anticipates thereafter the expansion of the network by 3 new branches each year, to reach 44 by 2017. Its preparations meanwhile for the launch of its Internet and mobile banking services are almost complete, in addition to the launch in 2013 of an Islamic credit card in three categories: gold, silver and bronze, only awaiting full implementation of the second phase of its new core banking system. The Bank also continued to increase it’s paid-up and issued capital in order to bring it to the same size of the authorized capital of one billion pounds,” he added.
Al Baraka Bank Egypt commenced its activities in accordance with Shari’a principles over 22 years ago and has grown as an Islamic institution to become one of the foremost in the Egyptian market. It provides a variety of services, products and savings deposit options to suit different requirements and financing programs to meet the requirements of various sectors of the Egyptian market, in addition to credit facilities for companies and joint financings for large and important national projects. The bank currently has 23 branches and 4 foreign exchange offices, spread across the major Egyptian cities
Al Baraka Banking Group is a Bahrain Joint Stock Company Licensed as an Islamic Wholesale Bank by Central Bank of Bahrain, listed on Bahrain Bourse and Nasdaq Dubai stock exchanges. It is a leading international Islamic bank providing its unique services to around one billion people and with Standard and Poor’s investment grade long term counterparty credit rating of BBB- / A-3 (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$1.5 billion, while total equity amounts to about US$ 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 more than 450 branches. Al Baraka is currently having a strong presence in Jordan, Tunisia, Sudan, Turkey, Bahrain, Egypt, Algeria, Pakistan, South Africa, Lebanon, Syria, Indonesia, Libya, Iraq and Saudi Arabia.