MANAMA: Ithmaar Bank, a Bahrain-based Islamic retail bank, announced that the strategic decisions taken by the bank’s board of directors early in 2014 have already started yielding results.
The decisions, which aimed at turning the Ithmaar Group around by significantly transforming operations, included initiatives for increased revenue, improved margins, divestment of non-core assets and cost reductions across the Group.
The announcement was made by the Ithmaar Bank Chairman, His Royal Highness Prince Amr Al Faisal, to the Bank’s shareholders at the Annual General Meeting (AGM) that was hosted at the Ramee Grand Hotel in Bahrain. Also present were Directors, members of the Ithmaar executive management team as well as representatives of the Bank’s Sharia Supervisory Board, the Central Bank of Bahrain, the Ministry of Industry and Commerce, statutory auditors PricewaterhouseCoopers, and the Bahrain Bourse.
“The immediate implementation of these strategic initiatives, coupled with the consistent growth of Ithmaar Bank’s core business has, despite challenging local, regional and international market conditions, contributed to improving the Bank’s performance in 2014,” HRH Prince Amr, said.
“As a result, Ithmaar Bank reported net profit before impairment provision and taxation of US$ 28.9 million for 2014, compared to only US$ 4.8 million profit for 2013. The net loss after impairment provision and taxation attributable to shareholders of US$ 15 million is significantly lower by 81% compared to US$ 80.3 million for 2013,” he said.
“This improved financial performance is mainly due to sustainable growth in Ithmaar Bank’s core retail banking operations, as is evident in the significant growth of the Bank’s operating income which increased by 14 percent to US$ 227.7 million in 2014, from US$ 199.9 million in 2013,” said HRH Prince Amr. “Despite growth in business, total expenses for the year ended 31 December 2014, at US$198.8 million, are under control and are 1.9 percent higher than 2013 expenses of US$195.1 million. Ithmaar Bank’s balance sheet also continues to be stable, with total assets increasing by six percent to US$ 7.86 billion as at 31 December 2014, compared to US$ 7.4 billion as at 31 December 2013. “The increase in customer balances reflects growing customer confidence in the Bank, as well as demand for its products and services,” he said.
“This transformation is, in a large part, a result of the strategic decisions taken by the Ithmaar Bank Board of Directors earlier in 2014,” HRH Prince Amr, said. “The benefits of these initiatives will continue in 2015 and beyond,” he said.
The AGM welcomed the improved performance, and said the Bank is clearly working towards realising the shared vision of becoming the region’s premier Islamic retail bank. At the AGM, shareholders also voted to adopt the proposed Staff Variable Remuneration Policy Framework, which was developed to comply with the Sound Remuneration Practices issued by the Central Bank of Bahrain.