BBK announces net profit of BHD 56.4 million for 2016; earnings steady at 49 fils per share.
BBK (profile), Bahrain’s pioneer retail bank, has published its 2016 financial results showing net profit of BHD 56.4 million, six per cent higher than its BHD 53.2 million profit in 2015.
Earnings per share for 2016 are 49 fils, close to 50 fils per share the previous year. BBK’s board of directors has recommended distribution of 30 fils cash dividend.
A statement issued by BBK quotes the board of directors as saying: “2016 was the first year of the bank’s three-year strategic cycle, and we are very satisfied with the progress achieved – both in terms of results and in preparing for the future.
“BBK has maintained a consistent performance that has been our hallmark for so long and was able to post a good profit despite the difficult business environment at home and abroad. Low oil prices, the slowdown in the Chinese economy, Brexit and the US elections added to uncertainty and the subdued macroeconomic conditions, and were all factors that have not been conducive to growth or expansion.
“However, by relying on our expertise, the strength of our strategy and management team, the robust financial and human capitals, as well as the solid relationships and the trust we built with our clients and other stakeholders over decades, we were able to turn 2016 into a year of achievements and deliver a very commendable across-the-board performance.”
Operational highlights
BBK’s operating revenues increased by 10.2 per cent to reach BHD 133.5 million in 2016, compared to BHD 121.1 million the previous year, driven mainly by a growth of 18.1 per cent in net interest income to reach BHD 85.8 million (2015: BHD 72.7 million), as the bank restructured its balance sheet by focusing strategically on more profitable segments such as retail, reducing thinly priced exposures and adequately controlling the cost of funding.
In addition, strong performance by the bank’s strategic investments contributed to the growth in operating revenues as the bank’s share of profits of associated companies and joint ventures increased by 29.7 per cent from BHD 4.2 million reported in 2015 to BHD 5.5 million for 2016.
Other income (fees and commission, foreign exchange and investment income) for 2016 amounted to BHD 42.2 million (2015: BHD 44.2 million).
BBK CEO Reyadh Sater said, “BBK was once again able to break previous record profits, and vigorously pursue and achieve a notable progress with the implementation of its new strategy. We expanded and improved our presence locally by adding a new branch in Hidd and replacing the refinery branch with a larger and more conveniently located branch in Sanad.
“Internationally, we expanded our footprint by opening a representative office in Turkey, and our plan to establish a joint venture investment firm in London is at an advanced stage of implementation. Moreover, BBK’s subsidiary, Invita, launched the Invita Training Center, an internationally accredited training services provider focused on providing organizations and individuals with foundation-level, world-class certified training programs”.
BBK’s balance sheet stood at BHD 3.7 billion at the end of 2016 compared to BHD 3.65 billion the previous year. Its loans portfolio stood at BHD 1.77 billion (December 2015: BHD 1.76 billion). The investment securities portfolio increased by 1.3 per cent to stand at BHD 768.1 million (December 2015: BHD 758.1 million).
The bank continues to maintain a high level of liquid assets, consisting of cash and balances with central banks, treasury bills and placements with banks and other financial institutions, at BHD 1.03 billion or 27.9 per cent of total assets. Customer deposits stood at BHD 2.49 billion compared to BHD 2.64 billion in 2015, with a comfortable loans to customer deposits ratio of 70.9 per cent compared to 66.8 per cent in 2015.