NBB reports net profit of BD58.24 million in 2016

Manama  : National Bank of Bahrain achieved a Net Profit of BD58.24 million (US$154.88m) in 2016, compared to BD55.26m (US$146.97m) in 2015, an increase of 5.4 per cent. 

For the fourth quarter of 2016, the bank recorded a Net Profit of BD12.03m (US$31.99m) compared to BD11.90m (US$31.65m) for the corresponding period of the previous year. The full year Earnings Per Share (EPS) improved from 48.5 fils in 2015 to 50.9 fils in 2016.

At the Board of Directors meeting held on 30 January 2017, chaired by the Bank’s Chairman, Farouk Yousuf Khalil Almoayyed, the board reviewed and approved the Bank’s financial results for the year 2016. 

Jean-Christophe Durand, Chief Executive Officer said: “The results for 2016 are the outcome of the Bank’s focus on generating revenue through efficient balance sheet management while prudentially managing risks amidst challenging business conditions”.

Net Interest Income for 2016 was BD65.99m (US$175.51m) compared to BD59.52m (US$158.30m) for 2015, a strong growth of 10.9pc. The increase is attributable to growth in average loans and advances and better return on deployment of surplus funds.  Total Other Income recorded for 2016 was BD30.88m (US$82.14m) compared to BD34.88m (US$92.77m) for the previous year.  The decrease is mainly attributable to capital gain on sale of certain fixed rate investments in the previous year which was not available during 2016 due to prevalent market conditions, lower share of profit from associates and lower fee income from lending operations.

Operating Expenses at BD34.09m (US$90.70m) showed an increase of 13.3pc over the previous year, reflecting a Cost to Income Ratio of 35.2%.  The impairment provision on Loans and Advances amounted to BD2.08m (US$5.53m) for the year 2016 compared to BD7.74m (US$20.59m) for the previous year. A charge of BD 2.46m (US$6.54m) was made in 2016 towards impairment on equity investments due to decrease in the market value of the investments.

The Board of Directors has decided to recommend to the Shareholders’ General Assembly Cash Dividend:  25pc (2015: 25pc), BD28.99m  (US$77.10m); Donations and Contributions of BD2.91m  (US$7.74m) and Transfer to General Reserve of  BD 17.39m  (US$46.25m)

The Board has also proposed to the shareholders a bonus issue of BD 11.60m at the rate of one additional share for every ten shares held (10pc). The bonus share issue is proposed to be made through utilisation of BD 11.60m from the General Reserve, which is subject to regulatory approvals. Total cash and stock dividend pay outs for 2016 amounts to 35pc. 

Total Shareholders’ Equity before 2016 appropriations stands at BD414.70m (US$1,102.92m). The appropriations to Donations and Contributions will bring the total allocation under the programme to BD42.68m (US$113.51m) since its inception in 1980. During the year, the Bank disbursed BD1.50m (US$3.99m) for several worthy causes in the Kingdom. 

Looking ahead, Durand said, “2017 will offer challenges as regional economies grapple with the level of oil prices and banks come to grips with regulatory constraints and newer norms for doing business. However, there are signs that Bahrain’s focus on infrastructure development and implementation of several projects of national importance will largely mitigate the negative effects of a weak global and regional economic outlook.”