BMB Investment Bank first quarter net income up 344.4% to $4.4m

This robust performance results from a 175.3% increase in the Bank's operating income before expenses from $2.5m at 31 March 2007 to $6.8m at 31 March 2008.

The Bank's profitability continues to be driven by its core private equity business with income from investments at $6.6m for the quarter versus $3.1m for the first quarter of 2007, an increase of 110.5%.

Foreign exchange translation income rose by 271.4% from $0.2m at the end of March 2007 to US $0.6m at the end of March 2008.

Meanwhile fee income came in at $0.1 as compared to $0.4 in the same period last year.

General and administrative expenses increased from $1.5m at the end of March 2007 to $2.5m at the end of March 2008 due to the increased staffing levels necessary to support the Bank's growth strategy as well as a one time adjustment to accrued leaving indemnities to reflect a market level increase in salaries.

Total assets at the end of the first quarter of 2008 stood at $142.8m as compared to $180.9m at the end of 2007.

This decline was for the most part due to the Bank's repayment of its syndicated loan and other deposits totaling $40.4m.

Shareholders' equity on the other hand increased by 3.7% from $71.4m at the end of 2007 to US $74.1m at the end of March 2008.

At 31 March 2008, the Bank's Basel II capital adequacy ratio stood at 24.4% as compared to 24.0% at 31 December 2007.

Other significant achievements in the quarter include the Bank's prepayment of the remaining balance on its $75m syndicated loan facility, a move which has provided the Bank with increased operational and strategic flexibility.

Furthermore at the Bank's March Ordinary General Meeting, shareholders approved a $75m capital increase which the Bank plans to implement later this year.

In commenting on the results the Bank's Chairman, Mr. Wilson Benjamin, said:
"We are extremely pleased with our strong start to the year despite the negative global economic environment. The Bank has no exposure to sub-prime or leveraged loans nor does it have any assets that could be directly impaired by the current turmoil in the financial markets. We believe our assets are of the highest quality and are confident that they will withstand the shocks of a turbulent market.

Additionally, and in line with our recently formulated strategic plan, we have initiated the process of developing and launching several new innovative products which would be marketed to our growing customer base".

Albert I. Kittaneh, Chief Executive, said:
"While the current global economic slowdown could have its impact on the pace of the sale of our investments, the proven quality of our portfolio and our conscious policy to mitigate risk through diversification not only ensure our ability to successfully weather the current financial storm but also invigorates us to forge ahead with great confidence.

We are also gratified that the market has reacted positively to the prepayment of our syndicated loan which has translated in a boost in the granting of trading and inter-bank funding lines. Along with other positive factors, these facilities are providing BMB with the financial and strategic flexibility to move forward in executing critical milestones towards realizing BMB's vision".


The Bank's first quarter report can be obtained through the Bank's web site at www.bmb.com.bh.

Bahrain Middle East Bank (BSC) was established in 1982 and holds a Wholesale Banking License. The Bank's shares are listed on the Bahrain Stock Exchange under (BMEB.BH) and are held by shareholders primarily across the GCC.