Burgan Bank's profits from banking operations soar by 40% in first half of 2008

These results compare favorably to the full year net profit of KD74.8m in 2007 and KD55.7m in 2006. The Core banking Operating profits showed a strong growth of 40% to KD32.2m, over the same period last year. This has resulted in increase in the ROE to 27.5% from 24.7%.

Despite the challenges posed by the banking landscape in the first half of the year, Burgan Bank's dynamic strategy ensured continued improvement in all areas. Productivity grew further as reflected by growth in Fees and Commission by 32% to KD10.4m and a reduction in Cost : Income ratio to 20% from 22% for the same period in the previous year. An enlarged, diversified customer base led to a 40.6% growth in loans and 46.8% growth in deposits on a year on year basis. With a KD334.1m shareholder's equity base, the Basel II capital adequacy ratio stands at 12.4 %, well positioning the Bank's capitalization both by local as well as international standards, under the revised guidelines by the Central Bank of Kuwait.

The Bank sees an extremely positive outlook for the year ahead, augmented by a regional expansion strategy that it recently embarked upon. The expansion seeks to establish a robust MENA-wide commercial banking franchise by acquiring a majority stake in four commercial banking entities in Algeria, Iraq, Jordan and Tunisia from United Gulf Bank for a consideration in cash of $725m. At the Bank's second AGM for the year 2008 held on the 30th of June, the Bank sought approval from its shareholders to raise capital by KD200m to fund this transaction.

"We are upbeat about substantial financial growth for the remainder of the year," says Burgan Bank Chairman Mr. Tariq Mohammed AbdulSalam. "Our shareholders and patrons have expressed high interest in our regional expansion plan and we estimate that the acquisition will engender a projected growth of 20% in our group net profit for 2008 following the finalization of the transaction. The strong FY08 H1 financial indicators are attributable to the Bank's prudent investment and risk management capabilities and is reflective of the confidence that shareholders have in the Bank's capabilities," he added.

Burgan Bank unveiled its new customer-centric corporate identity in late 2007 and is determined to continuously extend more value to its customers in line with its new positioning of being 'driven by you': the customers and stakeholders. Presently enjoying a wide network of 21 branches, close to 100 ATMs and one of the largest ATM drive-through service networks in the Middle East, the Bank will continue to focus on reaching customers through multiple touch-points as per their need and convenience. In keeping with the specific banking and financial needs of different segments of customers, the Bank successfully implemented its unique 'Branch Strategy' as part of its 'Bright Future' program over the past two years by introducing specialized branch types - Financial Centers, Solutions Branches and Transactions Branches. The Bank is committed to sustaining positive and rapid growth in its market share within Kuwait, and over the course of its three-year aggressive expansion strategy, aims to further establish and strengthen its presence across key markets within the MENA region.

Burgan Bank is a subsidiary of KIPCO (Kuwait Projects Company). Amongst the youngest and most dynamic commercial banks in the State of Kuwait, established in 1977, the Bank has acquired a leading role in the retail, corporate and investment banking sector through innovative product offers and technologically advanced delivery channels. It has continuously improved its performance over the years by applying an expanded revenue structure, good asset quality, diversified funding sources and a strong capital base. The adoption of state-of-the-art services and ground-breaking technology has positioned it as a trendsetter in the domestic market. At present it enjoys a wide reach through our network of 21 branches and over 100 ATMs making it one of the widest ATM networks in the GCC.

The brand has been created on a foundation of real values - of trust, commitment, excellence and progression to remind us of the high standards to which we aspire. 'People come first' is the foundation on which its products and services are developed and are further augmented by its three pillars of innovative technology, staff competency and customer service. It is committed to offering an enhanced banking experience.

The Bank was recertified and is still the only bank in the GCC with ISO 9001:2000 certification in all its banking businesses. It also has to its credit the distinction of being the only bank in Kuwait to have won the JP Morgan Chase Quality Recognition Award, 10th year in succession and was also acknowledged as the 'Best Local Private Bank' in Kuwait in the Fourth Annual Euromoney Private Banking Survey 2007. Further, for two consecutive years, it was conferred the COMMERZBANK Recognition Award, for maintaining high standards of quality, efficiency and reliability while processing Euro currency transactions as well.

The Bank's commitment to uphold best practices was recognized when it won the region's first Hawkamah-UAB Bank Corporate Governance Award 2007 while its marketing excellence was recognized as amongst the best in the region by the Middle East Business Achievement Awards 2007. It also received the 'Best Corporate Finance Bank Award' from Al Mazaya Holding at the latter's Third Finance Transparency Conference held earlier this year.