NBK reports record net profit of 515 USD million for 2004

The results put NBK's return on equity at 29.9% and its return on assets at 2.73%, among the highest worldwide.

"NBK had an outstanding performance at all levels during 2004, with profits maintaining their upward trend since the Bank's inception in 1952," says Ibrahim S. Dabdoub, CEO of NBK. "We were able to leverage our strengths to take advantage of growth opportunities presented by an improving operating environment. The driving force behind our success remains the diversification of revenue sources and risks, as well as our unwavering focus on the customer and service quality".

"This past year NBK took bold steps to strengthen its leadership in the local market in all business areas and maintain its technological edge. We introduced new innovative products tailored for specific segments. We refocused our energies in the branches to give undivided attention to the customer and better meet their needs with personalized solutions. We invested heavily in people and systems to redesign our call center into a state-of-the-art marketing and customer service operation. Above all, we launched initiatives across all business units to enhance our understanding of our customers and move ever closer to meet their needs."

Dabdoub pointed to the notable improvements in many of NBK's performance indicators during 2004, citing the increase in operating income to USD 789 million compared to USD 639 million last year, and the drop in the ratio of doubtful loans to 1.53% of the loan portfolio, one of the lowest in the industry world-wide.

NBK has consistently earned the highest credit ratings in the Middle East from Moody's, Standard & Poor's and FitchRatings, thanks to its healthy performance, high asset quality and strong capital base. Rating agencies also cite the strength and depth of NBK's management and its clear strategy as fundamental strengths underlying the Bank's superior ranking. These strengths have also earned NBK recognition as the Best Bank in the Middle East in overall performance and across different activities from reputable financial publications such as Euromoney, The Banker, Global Finance and Emerging Markets.

Dabdoub also noted NBK's successful initiatives in implementing its regional expansion strategy. During 2004, NBK acquired an interest in International Bank of Qatar (IBQ) together with full management control of the bank under the terms of a management contract. This offers NBK potential opportunities for growth and development within the promising Qatari market.

The Bank also inaugurated a new branch in Amman, Jordan, and a tenth branch in Lebanon. NBK's international network of branches at present covers the major financial centers in New York, London, Paris, Geneva, Lebanon, Bahrain, and Singapore, with plans to expand into Saudi Arabia, Iraq and China in the near future. NBK has the largest local network of 47 branches within Kuwait.

At the end of 2004, NBK's total assets amounted to USD 19 billion and its shareholders' equity topped USD 2 billion.