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This performance has to be viewed in perspective with the worldwide turmoil the financial sector went through during 2008.
The net special commission income rose to SR2,821m from SR2,289m in 2007; an increase of 23.2%. This achievement was possible thanks to a significant growth in the Banks' Loans and Advances portfolio and the maintenance of a funding cost at a low level.
While the marked total operating income of SR4,392m is 19% higher compared to 2007. the total operating expenses growth, other than provisions, have increased by 15.6% (SR148m).
This left some room for the Bank to do a prudent provisioning of SR94m for credit losses (SR52m higher as compared to the year 2007) and SR410m; for impairment charge on investments, owing to international economic slump.
The bank's balance sheet registered a growth where Loans portfolio stands at SR80.9bn and total assets at SR125.9bn at the end of 2008; representing a growth of 35.1% and 26.1% respectively. Also, the Customer deposits of the bank stands at SR92.8bn compared to SR74bn last year; an increase of 25%.
Commenting on the excellent results and strong financial standings of the Bank, Sheikh Ibrahim Al Touq, BSF's Chairman, said:
"the Bank sustained a steady growth in profits despite arduous times in the financial sector internationally and adverse conditions vis-à-vis Asset Valuations and falling Interest Rates."
This rewards the cautious approach on risk taking and bears testimony to the fact that BSF as an entity and as a team is highly committed towards ensuring that the shareholders' wealth is enhanced and financial strength of the bank is truly displayed and utilized. He added that year 2009 carry challenges for the banking industry in the Kingdom as the repercussions of international economic and financial crisis may flow to the region.
The bank has prepared itself and is all-set to face challenges the market forces may put forward.
I firmly believe in BSF's strategy and the hard work of BSF management and staff that these will strive for the Bank's sustained profitability in coming years.
