United Gulf Bank posts net profit of $11.0m

Key Financial Highlights for 2012:

• Net profit of $11.0m (2011: $1.5m)

• Basic earnings per share of 1.34 cents (2011: 0.18 cents)

• Total income before interest and other expenses $93.1m (2011: $108.6m)

• Net profit in Q4 2012 of $6.1m (2011: Q4 net loss of $12.5m)

• Total assets for 2012 of $1.23bn (2011: $1.78bn)

• Capital adequacy ratio of 23% (2011:18%) exceeding the minimum regulatory requirement of 12.5%

Financial Performance

UGB's net profit for the 2012 increased by 7.3 times to $11.0m compared to $1.5m in 2011, with a similar increase in basic earnings per share to 1.34 cents from 0.18 cents in 2011.

The increase in net profit is due to improved results of major associates, increased fees and commission income and reduced interest and operating expenses.

UGB's total assets stood at $1.23bn as at 31 December 2012, down from the $1.78bn recorded at the end of 2011. UGB managed to reduce leverage by $0.4bn and repay loans from internal resources.

UGB balance sheet remain strong with total equity of $478.2m (2011: $603.2m) and a capital adequacy ratio of 23% (2011: 18%), well above the Central Bank of Bahrain's minimum level of 12.5%.

UGB's Board of Directors will not be recommending any more dividend for 2012 beyond the $96.5m, in kind dividend distribution approved by Ordinary General Meeting of shareholders on 19th December 2012 (2011: Nil).

Commenting on the year results, Mr Masaud Hayat, Chairman of UGB, said, "We have delivered on our commitment made last year of deleveraging our balance sheet, managing our cost base and improving our recurring revenue stream. UGB's results show the strength of our asset base which continues to deliver the required returns. UGB is well positioned to take advantage of certain opportunities that are consistent with our strategy of investing in our core activities and markets."