Bahrain based leading Islamic banking group, Al Baraka Banking Group (ABG) has achieved a net income of $53.5 million in the first quarter of 2011, an increase of 11% on the net income achieved in the first quarter of 2010.
The financial statements of the Group for the first quarter of 2011 showed that the continued expansion in business reflected positively on income, with total operating income of $170 million in the first quarter of 2011, an increase of 8% over same period in 2010. After deducting all operating expenses, net operating income amounted $84 million in first quarter of 2011, which represents an increase of 8% compared to the net operating income during the first quarter of 2010.
The net income amounted to $53.5 million in first quarter of 2011 compared to $48 million in first quarter of 2010, which reflects an increase of 11%. The net income attributable to equity holders of the parent amounted to $31 million compared to $28 million for the first quarter of 2010, which represent an increase of 11%.
This increase was achieved despite the increases in the operating expenses of the Group on account of further expansion in the branch network, the effect of merger in Pakistan that happened in October 2010 and enhancements in IT infrastructure and human resources.
The total assets of the Group amounted to $16.3 billion as at the end of March 2011, an increase of 3% over the comparative figure as at the end of 2010. Financing and investments amounted to $11.6 billion as at the end of March 2011 compared to $11.4 billion at the end of December 2010, an increase of 1%. Customer deposit and other accounts and equity of investment accountholders have witnessed an increase of 2% from $ 13.6 billion at the end of December 2010 to $13.9 billion at the end of March 2011, which indicates continued customer confidence and loyalty to the Group. Total equity at the end of March 2011 remained almost the same as at the end of December 2010, amounting to $1.8 billion.
“A number of Arab countries during the first quarter of 2011 have witnessed large political and social shifts that have had temporary implications on the environment of the banking sector in those countries,” Sheikh Saleh Abdullah Kamel, Chairman of ABG said, while commenting on the results.
“It is natural that the operations of banks were affected by these developments, but we nevertheless note with satisfaction that ABG continued to achieve good results, which reflects the Group success in following precautionary strategies that enabled it to deal wisely with these developments and to continue expanding its business, and at the same time continue its geographic expansion programs and building branch network. This was not possible without the strong financial means, human resources and technical capabilities possessed by the Group, as well as its commitment to the Islamic banking model that impose the hard work for the reconstruction of the societies and serve the communities in which it operates,” he added.
“The financial and operational results achieved in first quarter of 2011 reflects the keenness of the Group to grow steadily and efficiently, despite growing regional and global challenges around us, and growing regulatory, technical and human requirements,” Abdulla Ammar Al Saudi, Deputy Chairman of ABG, said.
“The good results that we achieved during the first quarter of 2011 highlight once more our determination to continue to invest our substantial financial resources and expertise and the wide geographic network of the subsidiary units of the Group in maximising the returns to our shareholders and the investors,” Adnan Ahmed Yousif, Board member, President and Chief Executive of ABG, said.
“This was a result of implementation business strategies based on improving the quality of our products and services, offering more innovative products, expanding the branch network of the Group subsidiary units, which is around 376 branches in thirteen countries, strengthening the relationship with our partners, investors and customers and entering new markets, as well as modernizing and developing the human, operational, regulatory and technical infrastructures at the Group and subsidiary banking units levels,” he added.
“The subsidiary units of the Group in Turkey, Jordan and Algeria had resumed expansion by opening new branches in the first quarter of the year and this had direct positive impact on growing their deposit base and financing portfolios. We expect the number of branches of ABG banking units to exceed 500 over the next three years,” he said.
“In accordance with our new strategy, we have many plans and initiatives that we intend to implement during 2011. These will include launching new innovative products and services in the markets as well as enhancing the standing of ABG in the international markets. All of these plans will be implemented, God willing, successfully considering that we are the only Islamic banking group that has such diversity of geographical presence and excellent knowledge of the markets,” he added.