Pandemic, concessionary measures spoil BBK’s Q3

TDT | Manama

The Daily Tribune – www.newsofbahrain.com

BBK yesterday announced that its third quarter performance was adversely impacted by the COVID-19 outbreak and concessionary measures taken to support the domestic business community, as well as new regulations on capping fees and charges.

“The global reduction in the interest rates and the negative economic effects of the COV- ID-19 pandemic are continuing to adversely impact most sectors including the banking industry,” BBK statement said.

Q3 results

Third quarter net profit attributable to the owners of the bank was BD 9.9 million compared to BD 15.4 m in the same period of last year, a decrease of 35.7 per cent. Q3 basic and diluted earnings per share amounted to 7 fils compared to 12 fils during the corresponding period of last year.

Net interest income dropped by 25.8pc to BD 19.6 m from BD 26.4 m in the corresponding period of last year. Non-interest income (includes fees and commission income, and other income) dropped by 20.4pc to BD 8.2 m from the year ago quarter.

The bank said its share of profit from associated companies and joint ventures decreased from BD 1.5 m to a loss of BD 0.3m, as a result of the adverse impact of COVID-19 outbreak on the financial performance of the bank’s associated companies.

To offset this, the bank said it managed to decrease the operating costs by 8.6pc to BD 14.9 m and decreased net provision requirements by 59.0pc to BD 2.5 m.

Total comprehensive income attributable to the owners of the bank amounted to BD 19.9 m, compared to BD 17.9 m during the same period last year, representing an increase of 11.2pc. The increase is attributed to an increase in valuation of investment securities during the quarter following a robust rebound in financial markets.

Nine-month results

For the nine months, the bank achieved a net profit attributable to the owners of the bank of BD 39.0 m compared to BD 55.5 m in the same period in the previous year, registering a decrease of 29.7pc.

The basic and diluted earnings per share stood at 29 fils at the end of the period compared to 44 fils for the same period of last year.

Net interest income decreased 28.2pc to BD 60.3 m, as non-interest income (includes fees and commission income and other income) dropped 10.5pc to BD 29.0 m

Share of profit from associated companies and joint ventures decreased 65.6pc to BD 2.2 m.

Operating expenses decrease 3.4pc to BD 45.6 m while net provision charges decreased 65.3pc to BD 6.8 m during the current reporting period.

Net loans and advances registered a decrease of 5.2pc to reach BD 1,583.4 as Investment securities and deposits and amounts due from banks and other financial institutions increased by 5.8pc and 11.3pc to stand at BD 925.6 m and BD 309.8 m, respectively.

Total customer deposits stood at BD 2,077.1 m at end of September 2020; compared to BD 2,169.5 m reported at 2019-year end showing a decrease of 4pc. Loans to customer deposits ratio stood at 76.2pc (December 2019: 77.0pc).