Commercial banks in the Kingdom achieved a profit of $ 330 million in the first quarter of 2019, signifying the stability and steady growth of the Kingdom’s banking sector.
This was reported by the Bahrain Association of Banks (BAB), which also stated that financial institutions and banks in the Kingdom of Bahrain have achieved positive annual growth figures consecutively, confirming its significant contribution to supporting and developing the national economy.
CEO of the Bahrain Association of Banks, Dr. Waheed Al Qassim, explained that the continuous growth achieved by banks despite existing economic challenges made the financial service sector one of the largest non-oil economic sectors in the Kingdom. “The financial sector in the Kingdom accounted for 16.5% of Bahrain’s GDP in 2018. Its institutions currently employ around 14,000 people of which over 65% are Bahrainis,” stated Dr. Al Qassim.
“Bahrain’s financial sector has a long-standing regional reputation and is celebrating the 100th anniversary of the establishment of banks in Bahrain, this year,” he added.
The financial results of the seven local commercial banks, namely National Bank of Bahrain, BBK, Ahli United Bank, Bahrain Islamic Bank, Ithmaar Bank, Al Salam Bank, Khaleeji Commercial Bank reflected total profits which amounted to $ 330 million during the first quarter of 2019, an increase of 11% compared to the same period last year.
“This reflects the positive developments witnessed by the national economy at the end of last year and during the first quarter of this year following its entry into the Fiscal Balance Program. This boosts investor confidence in economic and investment activities, which contributed to the growth of the retail banking assets portfolio significantly during the first quarter of this year,” he stated.
The performance of the seven local retail banks, which are listed on the Bahrain Stock Exchange, witnessed a great improvement during the first quarter of 2019 compared to the same period last year.
The banks’ financial statements show that the increase in profit were due to higher interest income in light of increases in financing and investment operations in Bahrain and other countries from major financing operations and higher interest rates worldwide. “The acquisition of new customers, introduction of new products and increased fee and commission income from foreign trade and joint venture financing operations have also played a significant role in these increases,” explained Dr. Al Qassim.
“The improvement or stabilization of asset quality at banks as a result of the improvement in the overall economic situation in the Kingdom has largely contributed to reducing the need for banks to increase provisions, which has reflected positively on income,” he said.