ABC Islamic Bank reports $25.6m net profit for 2008

Gross operating income was $33.8m which, excluding an exceptional $32.8m capital gain in 2007 arising from the partial disposal of a sukuk investment, represented a 34% increase over the previous year.

Reduced operating expenses led to a net operating income of $28.84m. This strong performance in core profitability reflected a higher proportion of fee income, enabling balance sheet growth to be kept down to 7.1% year-on-year. Unfortunately it became necessary to set aside provisions in the fourth quarter, which were a direct consequence of the impact of the economic slowdown in the region.

Notwithstanding these provisions ABC Islamic Bank closed 2008 with a net profit for the year of $25.6m, compared with 2007's net profit of $50.9m.

After signing the year-end accounts, ABC Islamic Bank Chairman and ABC Group Deputy Chief Executive & Head of International Wholesale Banking, Mr. Abdulmagid Breish, commented

"While the performance on core business and revenue was satisfactory for 2008, more efforts will be made in 2009 to take the bank into higher level end products of a more structured nature."

Reflecting on the year as a whole, Naveed Khan, Managing Director of ABC Islamic Bank said, "The growth in our operating results and profitability over the past four years clearly shows the achievements arising from our renewed focus on our target market customer base in the GCC and Arab world region. ABC Islamic Bank will continue offering a full range of Shari'a-compliant products and solutions to our customer base, from basic working capital needs to complex hedging structures combined with a comprehensive & innovative liquidity management platform."