BBK 9-month net profit rises 5.6pc

Manama : The Bank of Bahrain and Kuwait (BBK) yesterday announced financial results for the nine months ended 30th September 2017, declaring a net profit attributable to owners of BD44.9m compared to BD42.5m achieved during the corresponding period last year, an increase of 5.6 per cent year-on-year. 

Net profits for the period was restated to reflect the impact of IFRS9 implementation of negative BD0.8m. Earnings per share amounted to 38 fils compared to 40 fils last year. 

Net profit was fuelled by the increase in operating revenues by 6.8pc to reach BD107.6m for the nine months till end of September 2017, compared to BD100.7m reported during the same period of 2016. This was primarily attributable to strong growth in other income (fees and commissions, foreign exchange and investment income), which witnessed an increase of 13.6pc to BD35.9m compared to BD31.6m reported for last year supported by the bank’s income diversification initiatives. Similarly, Net interest income increased by 3.5pc year-on-year to reach BD67.7m (YTD 2016: BD65.4m) and BBK’s share of profit of associated companies and joint ventures increased by 6.4pc to BD4.0m (YTD 2016: BD3.7m).

Operating costs for the period rose to 3.1pc to stand at BD39.6m compared to BD38.4m reported during the same period last year. Notwithstanding the increase in the cost, the cost to income ratio, however, showed an improvement from 38.1pc to 36.8pc.  

In line with the higher provisioning requirements mandated by IFRS 9’s expected loss model, BBK increased net provision allowance by BD22.1m during the nine months ending September 2017 (YTD 2016: BD 19.0m).

Total comprehensive income attributable to owners increased from BD36.2m as of 30th September 2016 to BD51.6m, mainly due to improvement in the fair value reserve of investment securities and higher net profit during the current year.

For the three months ended 30th September 2017, total revenues increased by 5.4pc compared to the corresponding period of last year reaching BD37.2m due to healthy growth across all revenues streams. Operating costs increased marginally by 2.1pc to BD13.0m. Net provision charges for the third quarter of 2017 increased to BD11.2m compared to BD9.5m during the same period of last year. Accordingly, the net profit for the third quarter of 2017 at BD12.7m is in-line with the profit reported in the same period last year.