Warba Bank Financial Results 2019

Warba Bank announced the results of its operations for the year ending December 31st 2019, which indicate that the bank’s net profit (after tax deduction) scored KD 16.5 million, increasing by KD 3.8 million or by 29.8% compared with KD 12.7 million in 2018. The rise in the net profit is attributed to the rise in total operating income by a higher value than the rise in total operating expenses. Therefore, the bank’s operating profit (before the deduction of total provision for impairment) rose by KD 6.7 million or by 21.9%. The following graph displays the development in the bank’s profits during (2011-2019):

In details, total operating income increased by KD 10.1 million or by 20.5%, reaching KD 59.7 million versus KD 49.6 million in 2018, this resulted from the rise in all operating income items. Mainly, item of net financing income that increased by KD 5.44 million or by 13.6%, reaching KD 45.49 million versus KD 40.05 million in 2018. Likewise, item of net investment income rose by KD 3.1 million or by 64%, to reach KD 7.9 million versus KD 4.8 million.

On the other hand, total operating expenses rose by a lesser value than the rise in total operating income, i.e. by KD 3.4 million or by 18.2% and scored KD 22.4 million versus KD 19 million. The rise included item of staff costs and item of depreciation by a total of KD 4.5 million, while item of general & administrative expenses decreased by KD 1.1 million. Percentage of total operating expenses to total operating income scored 37.5% versus 38.3% in 2018. Total provisions for impairment increased by KD 2.8 million or by 16.3%, reaching KD 19.8 million versus KD 17 million in 2018. This explains the rise in net profit margin to 27.7% versus 25.7% in 2018.

The bank’s financial statements indicate that total assets increased by KD 949.2 million or by 43.3%, to score KD 3.144 billion compared with KD 2.194 billion in the end of 2018. Item of financing receivables rose by KD 654 million or by 40.7%, scoring KD 2.262 billion (72% of total assets) versus KD 1.608 billion (73.3% of total assets) in the end of 2018. Percentage of financing receivables to total deposits scored 85.1% versus 85.2%.

Figures indicate that the Bank’s liabilities (excluding total equity) increased by KD 925.8 million or by 48.1%, scoring KD 2.849 billion compared with KD 1.924 billion in the end of 2018. Percentage of total liabilities to total assets scored about 90.6% versus 87.7% in 2018.

Results of analyzing financial statements indicate that the bank’s profitability ratios showed mixes performances in the end of 2019. The return on average equity (ROE) decreased to 8% versus 8.6%. Return on average assets (ROA) dropped slightly to 0.62% versus 0.64%. While return on average capital (ROC) increased to 11% versus 10.2%. Earnings per share (EPS) scored 7.73 Fils versus 7.06 Fils in 2018. (P/E) scored 35.6 times compared with 29.7 times in the previous year, due to the increase in the EPS by 9.5% against a greater increase in the share market price by 31%. (P/B) scored 1.9 times compared with 1.6 times in the end of 2018. The bank announced for the first time since its establishment that its distributing 5% bonus shares.