BankMuscat announces preliminary results for H109 net profit at RO60.4m, an increase of 5%

The preliminary result was approved by the Board of Directors on July 15, 2009.

The Bank achieved net profit of RO60.4m for the six months ended June 30, 2009 compared to net profit of RO57.8m reported during the same period in 2008. The net profit for the first half 2009 includes RO53.2m of post-tax gain on sale of HDFC Bank investment. The Bank had sold its remaining stake in HDFC Bank, India in June 2009 and as a result total post-tax gain of RO53.2m is reflected in the Income Statement in the first half results 2009.

During the second quarter of 2009, the Bank has made provision for credit losses amounting to RO.40.2m. This includes provisions on the Bank's exposures to two large business groups in Saudi Arabia, the Al Gosaibi and the Saad Group.

The key highlights of the first half 2009 results are as follows:

1) Net interest income increased by 12% to RO83.4m during the six months period ended June 30, 2009 from RO74.7m reported during the corresponding period in 2008.
2) Non interest income excluding the gain on HDFC Bank investment and realized losses on Available-for-Sale investment was lower by 9% compared to the same period in 2008.
3) The Bank successfully contained the operating expenses in 2009. Operating expenses for the first half 2009 at RO42.4m lower by RO1.1m compared to the same period in 2008.
4) In Q109, the bank had accounted for RO7.5m in respect of realized and unrealized losses on the AFS investment portfolio. In Q209, an additional RO1.9m of realized and unrealized losses on the AFS investment portfolio was accounted.
5) Impairment for credit losses for the first half 2009 was RO51.5m as against RO13.1m, an increase of RO38.4m.
6) Net loans and advances increased by 20% to RO3,818m as against RO3,192m as at June 30, 2008.
7) Customer deposits including CDs increased by 14% to RO3,214m as against RO2,816m as at June 30, 2008.

The Bank will release the final results along with complete set of financial statements for the six months period ended June 30, 2009 after the necessary approval by the Board of Directors during the last week of July 2009.