BBK reports H1, Q2 results
TDT | Manama
The Daily Tribune – www.newsofbahrain.com
BBK yesterday reported a 14% increase in its second-quarter 2021 net profit, thanks to higher net interest income, higher fees and commission income, robust management of distressed exposures and the intense remedial efforts resulting in an 85.7% drop in net provision requirements.
“The results achieved while the bank navigates through the challenging economic environment, increase its investment in strategic initiatives, and contributes positively to the social environment in the Kingdom,” said the Board of Directors in a statement.
“We look forward to future growth plans and we are certain that with the support of our shareholders, the dedication of the management and employees, and the loyalty of our customers we will continue to meet our shareholders’ expectations,” the statement added.
Dr AbdulRahman Saif, BBK’s Group Chief Executive added, “In BBK, we are vigorously implementing various measures to enhance our resilience, preserve our capital and liquidity and adapt to the new challenges to alleviate the negative impact of the pandemic.”
Net profit attributable to the owners of the bank was BD 13.8 m, up 14% from BD 12.1 m in the same period last year. Earnings per share amounted to 9 fils, compared to 8 files in the year-ago quarter. BBK’s net interest income rose by 3.0% to BD 20.4 m (BD 19.8 m in the corresponding period last year). The bank attributed the increase to dynamic balance sheet management and a 9.7% increase in fees and commission income to BD 3.9 m.
Besides, the bank said the robust management of distressed exposures and intense remedial efforts resulted in an 85% drop in net provision requirements to BD 0.7 m from BD 4.9 m for the same period of last year.
On the other hand, investment and other income decreased by 37.7% to BD 4.1 m (BD 6.5 m last year), and the bank’s share of profit from associated companies and joint ventures decreased by 64.7% to BD 0.6 m (BD 1.7 m last year).
Total comprehensive income attributable to the owners of the bank amounted to BD 22.4 m, compared to BD 93.0 m reported for the same period last year, representing a decrease of 75.9%.
Total comprehensive income, BBK said, was impacted by a strong and non-recurring rebound of financial markets and the recovery in valuations of financial assets during the second quarter of last year after the plunge caused by the COVID-19 pandemic during the first quarter of 2020 with an impact of BD 76.4 m, while the current year valuations of financial assets grown by BD 4.5 m.
The first-half net profit attributable to the owners of the bank was BD 28.1 m, compared to BD 29.2 m in the same period last year, a decrease of 3.6%.
Earnings per share amounted to 19 fils compared to 20 fils during the same period last year. The drop in net profit is mainly attributable to a lower bank’s share of profit from associated companies and joint ventures from BD 2.5 m during the first half of 2020 to a loss of BD 0.7 m for the current period, largely due to the adverse impact of the pandemic on the financial performance of the bank’s associates and joint ventures.
Also, fees and commission income and investment and other income dropped to BD 17.3 m, representing a drop of 16.8%, largely due to the impact of concessionary measures taken in response to COVID-19 to support the domestic business community and the impact of new regulatory caps on fees and charges.
At the same time, the net interest income increased by 1.2% from BD 40.8 m last year to BD 41.3 m in the current period. The total customer deposits registered a decrease of 1.1% to stand at BD 2,143.7 m (31 December 2020: BD 2,167.4 m), while the loans to customer deposits ratio remained at a comfortable level of 70.7% (31 December 2020: 71.8%).