Ahli United Bank B.S.C. (AUB) reported a net profit attributable to its shareholders of $376.3m for the nine months ended 30 September 2014.
This reflected an increase of 30.1% over the core net profit of $289.3m achieved in YTD Q3/2013. The overall YTD Q3/2013 result of $502.2m included an exceptional non-recurring gain of $212.9m from the sale of its 29.4% stake in its Qatari affiliate.
The Q3/2014 net profit achieved was $113.8m, a 14.8% increase over the Q3/2013 reported profit of $99.1m. The Basic Earnings per Share in YTD Q3/2014 were US 6.3 cents, compared to US 5.0 cents, excluding the exceptional gain, for the nine months ended Q3/2013.
The operating results of AUB were primarily driven by growth in its core operating earnings across its major markets. During the period, the improvement in the net interest margin together with prudent growth in risk assets resulted in a 10.3% increase in Net Interest Income from $524.6m to $578.7m. Diversified business initiatives and successful client acquisition initiatives contributed to a 4.5% growth in fee income from $106.7m to $111.5m. The YTD Q3/2014 cost income ratio improved to 28.4% (YTD Q3/2013: 29.6%) largely as a result of intelligent spend aligned to business needs without affecting the ability to efficiently service clients and to invest in future growth.
The Group’s total assets rose to $34.1bn, an increase of 4.5% over the 31 December 2013 position. This increase was driven by a $1.4bn (+8.2%) increase in the loan portfolio to reach $18.7bn by 30 September 2014. The growth in loan and advances was funded by an increase in customers’ deposits to $24.4bn as at 30 September 2014 (31 December 2013: $22.0bn). Asset quality remains solid with the non-performing loans ratio standing at 2.1% (31 December 2013: 2.3%) while the specific provision coverage ratio improved to 91.5% (31 December 2013: 86.1%). The total provision coverage ratio, inclusive of collective impairment provisions, rose to 172.4% as at 30 September 2014 (31 December 2013: 155.5%).
The AUB Group’s Return on Average Equity (ROAE) for YTD Q3/2014 increased to 15.9% based on the improved operating results, compared to the operating ROAE, excluding the exceptional gain, of 14.2% achieved in the prior period. Return on Average Assets, calculated on the same basis, was also higher at 1.6% for YTD Q3/2014 (YTD Q3/2013: 1.4%).
“AUB’s diversification in its major operating markets and its continued success in expanding cross border business flows between these markets have helped it achieve a robust growth in sustainable core operating revenues, while maintaining solid asset quality parameters,” said Fahad Al-Rajaan, Chairman, AUB. He added: “AUB continues to seek opportunities, where viable, to expand its banking franchise further through value accretive organic or inorganic means. This entails a continuous, dynamic and focused approach to ensure the effective deployment of capital resources across the AUB Group’s current and targeted markets.”