Al-Salam Bahrain announces $100m of operating income

The Bank's total assets at 31 December 2008 reached BD554m ($1,470m) from BD398m ($1,056m) at 31 December 2007 due to solid growth in customer deposits.

The operating income increased to BD37.6m ($100m) in 2008 from BD32.7m ($86.7m) recorded in 2007. The operating expenses amounted to BD11.8m ($31.3m) against BD9.5m ($25.1m) in 2007 with the cost-to-income ratio for the year reaching 31.3% (2007: 28.9%).

The earnings per share (EPS) for the year amounted to 21.3 fils (2007: 19.3 fils). The directors are recommending a cash dividend of 10 fils per share or 10% of the paid-up capital, subject to approval by the shareholders in the forthcoming annual general meeting.

The shareholders' equity of the Bank stood at BD172.5m ($457.6m) against BD159.5m ($423m) at 31 December 2007. The year-end liquidity position and capital adequacy of the Bank remained extremely strong with a liquidity ratio of 40% and a Basel 2 capital adequacy ratio of 24.7%. The capital adequacy ratio is net of proposed dividends and appropriations.

At 31 December 2008, the Bank maintained liquid funds of over BD200m ($530m) with cash balance and reserves with the Central Bank of Bahrain of BD111m ($294m). The Bank continues to be a net lender to the Banking system.

The Chairman, HE Mohammed Alabbar, stated that the performance of 2008 reflects the robustness of the business strategy put in place by the Board and an effective implementation by management to deliver value to our shareholders. HE Alabbar stated that the Bank is taking an aggressive approach to business while maintaining a balance between profit generation and risk management.

HE Alabbar stated that 2009 would be a very challenging year for the banking sector and the Bank has positioned itself well to overcome these challenges due to a strong and growing deposit base and a robust risk management framework.

The Bank will hold its Annual General Meeting on Sunday 22 February 2009 at 1:30 pm at the Gulf Hotel.

At the AGM, shareholders are expected to discuss and approve the Board's report on the bank's activities for the year ended 31 December 2008 and to receive the Shari'a Supervisory Board and the external auditor's reports for the same period.