Boubyan Bank Financial Results – 30 September 2019

Boubyan Bank announced results of its operations for the first 9 months of the current year 2019 which indicate that the bank’s net profits (after tax deductions) were at KD 45.25 million, a rise by KD 4.84 million or by 12% compared with KD 40.41 million for the same period of 2018. The rise in net profits is attributed to the absolute rise in total operating income by a higher value than the rise in total operating expenses, accompanied by the decrease in total provisions by KD 3.23 million or by 15.3%. Therefore, the bank’s operating profit (prior to provisions deductions) increased by KD 1.82 million or by 2.9%, reaching KD 65.22 million versus KD 63.40 million during the same period of last year. In details, total operating income of the bank increased by KD 4.46 million or by 4.2%, and scored about KD 109.39 million versus KD 104.93 million for the same period of 2018. This resulted from the rise in all items of the operating income, except for the item of net financing income that decreased by KD 2.76 million, reaching KD 87.99 million compared to KD 90.66 million. Total operating expenses increased by a lesser value than the rise in total operating incomes, i.e. by KD 2.64 million or by 6.3%, to KD 44.17 million compared with KD 41.53 million in same period of 2018. The rise included items of staff costs and depreciation by a total of KD 4.40 million, while general & administrative expenses item decreased by KD 1.76 million. Percentage of total operating expenses to total operating income scored 40.4% versus 39.6%. Provision for impairment dropped by KD 3.23 million or by 15.3% 

as mentioned previously, to reach KD 17.92 million versus KD 21.15 million. The net profit margin scored 41.4% against 38.5% in same period of 2018.

The bank’s financial statements indicate that total assets increased by KD 688.2 million or by 15.8%, and scored KD 5.033 billion compared with KD 4.345 billion in the end of 2018. Total assets increased by KD 779.8 million or by 18.3%, when compared with the same period of 2018 when total assets scored KD 4.253 billion. Item of Islamic financing to customers increased by KD 374.9 million or by 11.5%, and scored KD 3.637 billion (72.3% of total assets) compared with KD 3.262 billion (75.1% of total assets) in the end of 2018. It increased by 13.9% or by KD 444.2 million, if compared with KD 3.193 billion in the same period of 2018 (75.1% of total assets). Percentage of Islamic financing to clients to total deposits and other balances scored 84.2% versus 85.5%. Also, item of cash & balances with banks increased by KD 127.8 or by 152.5%, scoring KD 211.6 million (4.2% of total assets) versus KD 83.8 million (1.9% of total assets) in the end of 2018. It also increased by KD 135 million or by 176.4%, when it scored KD 76.6 million (1.8% of total assets) in the same period of last year.

Figures indicate that the Bank’s liabilities (excluding total equity) increased by KD 529.1 million or by 13.7% and scored KD 4.388 billion compared with KD 3.859 billion in the end of 2018. If we compare total liabilities with the same period of 2018, it would have increased by KD 608.6 million or by 16.1%, when total liabilities scored KD 3.779 billion. Percentage of total liabilities to total assets scored about 87.2% versus 88.9%.

Results of analyzing financial statements calculated on annual basis, indicate that the profitability ratios of the bank showed mixed performances compared with the same period 2018. The average return on shareholders’ equity (ROE) dropped to 12.4% versus 13.9%. Likewise, the average return on capital (ROC) decreased to 22.9% versus 23.1%. The average return on assets (ROA) slightly decreased to 1.29% versus 1.31%. Earnings per share (EPS) rose to 15.25 Fils against 14.20 Fils. (P/E) scored 27.2 times compared with 29.7 times (improved), as a result of the EPS increasing by 7.4% above its level on 30 September 2018, against a decrease in the market share price by 1.4% below its price on 30 September 2018. (P/B) scored 2.5 times versus 2.8 times.