Gulf International Bank B.S.C. reports a 42 per cent increase in first quarter profits to USD39.2 million

The strong year-on-year advance was attributable to higher non-interest earnings and a lower level of provisions. Net income is reported after provisions for credit losses of $8.8 million, being $11.3 million lower than the provision charge of $20.1 million in the first quarter of 2003. Net interest income at $43.1 million was marginally lower than in the prior year period. A decrease in interest earnings resulting from the lower interest rate environment was largely offset by higher margin income from the core GCC banking activity.
Other income at $33.9 million was $3.1 million or 10.1 per cent up on the prior year reflecting a further advance in investment banking and management fees. Investment banking and management fees at $6.5 million for the quarter were 41.3 per cent up on the prior year reflecting the bank's strategic emphasis on merchant banking activities. A 7.4 per cent increase in total expenses was principally due to the impact of the weaker US Dollar on foreign currency denominated expenses.

Consolidated total assets at the quarter end were $17,951.8 million, being $649.4 million up on the 2003 year end level. This was principally attributable to a $485.1 million increase in loans and advances. The Group's balance sheet-related financial ratios continue to remain strong with the liquid assets ratio standing at a particularly high 72.7 per cent. Following the declaration of a dividend of $53.1 million in respect of the 2003 financial year, shareholder's equity at the end of the first quarter was $1,390.9 million and represented 7.7 per cent of total assets.