ABG posts FY20 net income of US$67m

TDT | Manama

The Daily Tribune – www.newsofbahrain.com

Bahrain-based Al Baraka Banking Group (ABG), yesterday reported a fourth-quarter net loss of US$ (0.4) million attributable to equity holders of the parent, compared to a net income of US$ 22 m attributable to equity holders in the year-ago quarter.

Quarterly earnings per share were US Cents (1.30) compared to US Cents 0.73 in the prior-year quarter. Total operating income reached US$ 301 m compared to US$ 290 m, an increase of 3%.

Net operating income increased by 12% to reach US$ 147 m compared to US$ 131 m in the year-earlier quarter.

Total net income decreased by 31% to reach US$ 34 m compared to US$ 48 m in the same period of 2019.

Full-year results

For the full year 2020, the Group achieved a net income of US$ 67 m attributable to equity holders of the parent compared to US$ 106 m a year ago, with a decline of 37%.

Earnings per share were US Cents 2.90 compared to US Cents 6.01 for the same period of 2019.

Total operating income increased by 18% in 2020, to reach US$ 1.140 billion compared to US$ 967 m in 2019.

An indication of the Group’s success in controlling the expenses is the net operating income, which increased by 45% to reach US$ 579 m in 2020 when compared to US$ 399 m in 2019.

Total net income reached US$ 166 m compared to US$ 180 m, a decrease of 8%.

The decrease in the net income was because of the Group’s allocation of a significant increase in precautionary provisions to offset the adverse effect resulting from the negative economic impact of the COVID-19 pandemic on the businesses of the Group and its units.

These provisions increased by 138% to reach US$ 290 m in 2020 compared to US$ 122 m in 2019. In regards to the balance sheet items, the equity attributable to the parent’s shareholders and Sukuk holders amounted to US$ 1.42 billion by end of December 2020 compared to US$ 1.47 billion by the end of December 2019.

This reflected a decline of 3% due to foreign currency translation reserve, payment of cash dividends and payment of Tier 1 profits during the year.

Commenting, the Chairman of the Board of Directors of Al Baraka Banking Group, Abdullah Saleh Kamel said, “The Corona pandemic has swept the world since the beginning of the year 2020, and this has resulted in massive and wide-ranging humanitarian, social and economic repercussions.

Through our units spread across 17 countries, we were able to face these challenges and limit their effects on our Group and our units.” Abdullah Saleh Kamel added, “Going forward, we shall continue with the requisite processes for converting the Group’s current Wholesale Banking license in the Kingdom of Bahrain to a Category 1 Investment Firm license, subject to receiving the necessary approvals from the Central Bank of Bahrain, under whose regulatory supervision the Group would continue to operate.

This transformation will enable the Group to streamline operations, enhance efficiency and make better use of its resources to serve its subsidiaries and other stakeholders while continuing to provide strategic direction for all its subsidiaries.”

Member of the Board of Directors and Group Chief Executive Officer of Al Baraka Banking Group, Mazin Manna, said, “The onset of the pandemic motivated us even more to accelerate the implementation of our strategies in digital transformation in the Group and the units to transform our electronic networks into effective platforms to provide all banking services.

We will attach great importance to this aspect during the forthcoming period, by developing a comprehensive plan, as digital banking will be the main channel for customer service and product delivery”.