Bank ABC Islamic posts first quarter 2022 net profit of US$8.8 million

TDT | Manama

The Daily Tribune – www.newsofbahrain.com

Bank ABC Islamic closed the first quarter of 2022 with a net profit of US$ 8.8 Million, largely on track with the expectations for Q1.

The core banking business grew on a year-on-year basis as it gradually emerges from the impact of the Covid 19 pandemic.

However, the banks said the capital markets business witnessed subdued activity in the first quarter due to the rising profit rate environment as well as volatility in the market caused by the geopolitical situation.

“As the markets stabilize and investors and issuers get used to the new higher rate environment, we expect the capital markets business to pick up with new Sukuk issuances and Syndicated facilities.”

Q1 results

First-quarter net profit was US$8.8 million compared to US$10.4 m in the first quarter of last year.

Total operating income was US$9.1 m compared to US$ 11.7 m in the year-ago quarter. Allowances for credit losses were a write-back of US$2 m compared to US$0.7 m reported during the same period last year.

The higher write back was mainly due to improvement in the macroeconomic environment in a post-pandemic world.

Operating expenses were US$2.1 m compared to US$1.9 m for the same period of last year, with the business returning to normalcy as compared to last year.

The bank’s capital base remains very strong with a capital adequacy ratio of 40.7%, predominantly Tier 1, which totalled 40%.

Hammad Hassan, Managing Director of Bank ABC Islamic said, “We started the year with the milder Omicron variant and as a result with lesser restrictions, leading to business travel returning to normalcy.

This will have a positive impact on new to-bank customer acquisition, an important performance metric for the business.”

“We are largely on track with our expectations for performance in 2022.

With the improvement in macroeconomic credit environment and the region benefiting from the higher oil price, we remain cautiously optimistic about business performance picking up pace during the coming months”.