Al Baraka Islamic Bank Reports Strong Q1 Turnaround, Cuts Losses 66%

Income Before Tax Increases by 13% and Loss Attributable to Shareholders Declines by 66%:

Al Baraka Islamic Bank Achieves Positive Turnaround with Net Income of BD12thousand in Q1 2026

Al Baraka Islamic Bank announced its financial results for the three-month period ended 31 March 2026, recording an improvement across a number of key performance indicators. The Bank achieved consolidated net income for the period of BD12 thousands, compared with a consolidated net loss of BD367 thousands for the corresponding period in 2025, reflecting an improvement of 103% compared with the consolidated net Loss recorded in the same period last year, and a turnaround from loss to profit.

Consolidated net income before tax increased by 13% to reach BD1,117 thousand during the first quarter of 2026, compared with BD988 thousand in the first quarter of 2025. Loss Attributable to Equity Holders of the Parent decreased by 66% to BD305thousand, compared with a loss of BD903 thousand in the corresponding period of last year.

During the reporting period, income from financing facilities increased to BD 9,771 thousand from BD 8,929 thousand, reflecting growth in the core financing portfolio, while banking services income rose slightly to BD 788 thousand from BD 768 thousand. Investment income declined to BD 6,309 thousand from BD 7,862 thousand due to lower market profit rates, and other income reduced to BD 606 thousand from BD 1,101 thousand. Meanwhile, the cost of funds reduced to BD 10,069 thousand from BD 10,897 thousand, supported by effective repricing. Operating expenses increased due to expansion in operations; however, strong recovery efforts led to a net reversal of impairment. Overall, these factors enabled the Bank to successfully turnaround from operating losses to operating profitability.

At the financial position level, Consolidated Total Assets stood at BD1,043,655 thousands as at 31 March 2026, compared with BD1,093,816 thousand as at 31 December 2025, representing a decrease of 5% mainly in lieu of consolidation efforts and effects of outbreak of geopolitical conflict in the region. The contraction was broadly reflected across key balance sheet items, including deposits, financing assets, and liquid assets. However, the investment portfolio increased, driven by the acquisition of new sukuk issued by domestic sovereign entities.

This improvement in the results for the first quarter of 2026 is attributable to the growth in revenue generation from Financing Contracts and moderation of cost of funds and strong remedial efforts, in addition to the Bank’s continued efforts to enhance operational efficiency and diversify its income sources, while maintaining a balanced approach to risk management amid regional developments and their impact on various sectors. During the period, the Bank also continued to implement key initiatives across product development, strategic partnerships, sustainability and corporate social responsibility, supporting its market presence and strengthening its relationship with customers.

 Akram Yassin: Firm Confidence and Sustainable Growth

Commenting on the financial results, Mr Akram Yassin, Chairman of Al Baraka Islamic Bank, stated: “The results for the first quarter of 2026 reflect Al Baraka Islamic Bank’s ability to continue improving its financial and operational performance within a changing economic environment, affected by regional developments and the challenges they have posed across various sectors.

The Bank continued to focus on enhancing operational efficiency, developing sustainable income sources, and reinforcing a balanced business model capable of supporting its long-term strategic objectives.”

 The Chairman added: “On this occasion, we extend our sincere thanks and appreciation to the Wise Leadership, led by His Majesty King Hamad bin Isa Al Khalifa, King of the Kingdom of Bahrain, and to His Royal Highness Prince Salman bin Hamad Al Khalifa, Crown Prince and Prime Minister, and the Respected Government, for their continued support of economic growth and the banking sector in the Kingdom of Bahrain. We also value the pivotal role of the Central Bank of Bahrain in strengthening the resilience and stability of the financial and banking sector under various circumstances and developments.”

 Dr Adel Salem: Growing Operational Efficiency

For his part, Dr Adel Salem, Chief Executive Officer of Al Baraka Islamic Bank, said: “During the first quarter of 2026, the Bank continued to achieve tangible progress across a number of key indicators, with Consolidated Net Income Before Tax increasing by 13% to reach BD1,117 thousand, compared with BD988thousand in the corresponding period of the previous year. The Bank also achieved Consolidated Net Income for the period of BD12thousand, compared with a loss of BD367thousand in the first quarter of 2025.”

He continued: “The 9% increase in Income from Financing Contracts to BD9,771 thousand reflects continued demand for the Bank’s Sharia-compliant financing solutions, alongside the effectiveness of our efforts to diversify income sources and enhance the efficiency of financial resource deployment. The Bank also maintained a balanced approach to risk management, which contributed to supporting sustainable performance amid changing market conditions.”

 Dr Adel Salem concluded: “Over the coming period, we will continue to focus on developing banking products, enhancing the digital experience, and growing the financing and investment portfolio within a balanced risk management framework. We will also move forward in supporting initiatives with economic and social impact, including innovative financing solutions, strategic partnerships, and sustainability and corporate social responsibility programmes, further strengthening Al Baraka Islamic Bank’s position as a trusted banking partner for individuals and corporates.”

 Key Milestones During the First Quarter

During the first quarter of 2026, Al Baraka Islamic Bank continued to implement a number of key initiatives reflecting its commitment to developing its products and services and strengthening its relationship with customers and partners. The Bank organised a joint automotive exhibition that brought together a selection of authorised car dealers under one roof, in an initiative aimed at providing an integrated experience for customers seeking car financing solutions. The Bank also launched its Ramadan promotional campaign for credit cardholders, giving customers the opportunity to win cashback when shopping at a number of major supermarkets.

During the period, the Bank also announced the winners of the “Barakat Al Million” prizes, with 11 customers winning cash prizes with a total value exceeding USD1 million, reflecting the continued success of “alBarakat” scheme as one of the Kingdom’s leading savings programmes. The Bank also continued to develop its savings product offering through the launch of the enhanced 2026 “alBarakat” prize scheme and the re-introduction of “alBarakat Plus” account, giving customers wider benefits and greater opportunities to win.

 Sustainability and Strategic Partnerships

As part of its commitment to sustainability and corporate social responsibility, Al Baraka Islamic Bank successfully concluded the “RISE” training programme in collaboration with the Alia Centre for Early Intervention. The programme aimed to train a number of individuals on the autism spectrum and provide them with practical experience within a banking work environment. The Bank also launched an exclusive green car financing offer in collaboration with Adamas Motors, further reinforcing its direction towards providing environmentally responsible financing solutions that support sustainability goals in the Kingdom of Bahrain.

On the strategic partnerships front, Al Baraka Islamic Bank signed the third addendum to the housing finance programmes agreement with Eskan Bank, to include the programme for the sale of housing units before completion under the framework of cooperation between the two parties. This contributes to providing flexible financing options for citizens and supporting efforts to develop the housing finance ecosystem in the Kingdom.

Al Baraka Islamic Bank is considered one of the leading Islamic banks in the Kingdom of Bahrain. Since its establishment in 1984, the Bank has achieved strong results in the services it provides to individual and corporate customers. It has a strong track record in innovation and the development of Sharia-compliant investment solutions, and holds a leading position among banks offering Islamic banking products and services to local and international customers.