Khaleeji Commercial Bank (Trading Code: KHCB), one of the leading Islamic Banks in the Kingdom of Bahrain, has announced its semi-annual financial results ended 30th June 2020, reporting a net profit of BD 5.709 million attributable to the shareholders of the bank, compared to BD 199 thousand for the same period of the previous year, with an increase of 2769%. This had a positive impact on the earnings per share, which reached 6.521 Fils, compared to 0.211 Fils for the same period of the previous year, an increase of 2991%. The increase in net profit is mainly due to the reduction in cost of funding, total expenses and total provision for the period compared to last year.
The financial results also showed an increase in the Total Owners’ Equity by 64.81% reaching BD 141.252 million, compared to BD 85.707 million, as well as an increase in Total Assets by 2.24% reaching BD 960.813 million, compared to BD 939.752 million last year. Total investments (including sukuk) showed an increase by 38.36% reaching BD 370.2 million, compared to BD 267.6 million last year. Total Financing and asset acquired for leasing decreased by 4% bringing it to BD 451.7 million compared to BD 470.6 million last year. Total customer Deposit decreased by 13.9% reaching BD 615.6 million compared to BD 714.9 million last year.
Furthermore, the Bank recorded an increase of 5.98% in Total Income reaching BD 11.369 million during the first six months of 2020, compared to BD 10.727 million for the same period in 2019. Despite the economic challenges created by the COVID-19 Pandemic on the local market, the Bank has maintained a strong Capital Adequacy Ratio of 21.41%.
Commenting on the financial results, Mr. Jassim Alseddiqi, Chairman of KHCB’s Board of Directors, said “As a result of an ambitious business strategy that was approved by the Board at the end of last year, the Bank has recorded a remarkable performance. Strong foundations were laid for this strategy by issuing Sukuk worth USD 159 million as Additional Tier 1 “AT1” Capital. This has helped the bank develop a business model that keeps pace with current developments and enabled us to take advantage of new opportunities by redirecting the Bank’s financial and human resources towards sectors and areas that will increase profitability and generate remunerative returns for Shareholders.”
Mr. Alseddiqi added “The Bank was able to achieve these results in spite of extraordinary circumstances witnessed by the world due to the spread of COVID-19, confirming the Bank’s strong infrastructure based on stable financial performance and client confidence. Moreover, the Kingdom’s economic climate played a prominent role in protecting all sectors, including the Banking and Finance Sectors from the negative impacts of the pandemic. This was done thanks to the almighty God first, then to the preventive decisions and measures taken by Team Bahrain that contributed to the continuation of economic activity and enabled companies and institutions to continue growing and generate profits.”
Mr. Alseddiqi continued “On behalf of myself, the Board members, the Executive management, and all employees of KHCB, I would like to take this opportunity to express my utmost thanks and gratitude to His Majesty King Hamad bin Isa Al Khalifa may God protect him, His Royal Highness Prince Khalifa bin Salman Al Khalifa, the Prime Minister may God protect him, and His Royal Highness Prince Salman bin Hamad Al Khalifa, the Crown Prince, Deputy Supreme Commander and First Deputy Prime Minister may God protect him, for the proactive decisions they have taken to preserve the financial and business market and all other sectors from the negative impacts of the COVID-19 Pandemic. This made the Kingdom one of the top advanced countries facing this pandemic. Also, I would like to thank the Central Bank of Bahrain for its directives and support of the banking sector, which has contributed to its stability under current circumstances.”
For his part, KHCB CEO Mr. Sattam Algosaibi said “Over the past six months, the Bank’s executive management has worked thoughtfully to realize the interim aims of the bank’s new strategy. Achieving these results reflects the efficiency and intactness of the plans that the management has put together to strengthen the capital base and develop the business. The Sukuk issuance had a great impact on strengthening our financial position which allowed us to engage in new strategic partnerships and promising projects, creating the basis for the bank’s growth and profitability.”
Mr. Algosaibi added “The Bank will continue to invest in developing eBanking Service Systems and the quality of services provided to clients. In this context, we look forward to move towards digital transformation at an accelerated pace with confidence to implement the latest cutting-edge technology introduced to banking services, and to develop an integrated set of innovative technological banking solutions for the foreseeable future that will include all platforms and smartphone applications. We will also work on building more strategic relations with our business partners in order to enter joint-venture projects to enhance our financing portfolio, which will benefit the Bank’s financial position.”
KHCB is a leading Islamic bank that strives to achieve clients’ aspirations through an Islamic banking model that offers a comprehensive range of high quality Shari’a-complaint banking services and investment opportunities to individuals and companies.