MANAMA: Ithmaar Bank, a Bahrain-based Islamic retail bank, said that its retail banking subsidiary in Pakistan, Faysal Bank Limited (FBL), recorded $17.8m profits in Q1 of 2017.
The statement added that the financials showed remarkably improved profitability for the first quarter of 2017 compared to the corresponding period last year.
The announcement, by the Bank’s Chief Executive Officer and FBL Vice Chairman, Ahmed Abdul Rahim, follows the review and approval by the FBL Board of Directors of the financial results for the quarter ended 31 March 2017.
FBL, has upgraded its core banking system, and strengthened processes and increased its reach to preferred business sectors and customers through an improved product menu and increased branch network. FBL added 75 branches in 2016 and plans to add 50 more branches during 2017. These measures are expected to translate into better returns for shareholders of the Bank. FBL is listed on the Pakistan Stock Exchange and is mainly engaged in corporate, commercial, retail and consumer banking activities. Ithmaar Bank owns 66.6 percent of FBL.
“I am pleased to announce that FBL registered a healthy profit, after tax, of US$ 17.8 million (PKR 1.9 billion) during the first quarter of 2017, compared to US$ 12.9 million (PKR 1.4 billion) during corresponding period of 2016,” said Abdul Rahim. “During the last two years, the banking industry in Pakistan experienced lower interest rates. These economic realities have restricted the profit earning capacity of banks. As a result, FBL repositioned its strategy by introducing low cost deposit mobilization initiatives to protect spreads,” he said.
“FBL has also made sizable recoveries from delinquent clients and administrative cost has been kept under strict control,” said Abdul Rahim. “FBL successfully executed large corporate deals and was lead arranger for a number of entities in the transport and energy sectors pertaining to China Pakistan Economic Corridor (CPEC) projects. These measures helped increasing Earnings per Share (EPS) of the Bank for the first quarter, from PKR 1.13 to PKR 1.56,” he said.
“FBL’s Balance Sheet stands at US$ 4.2 billion (PKR 444 billion) and deposits have reached US$ 3.2 billion (PKR 338 billion) as at 31 March 2017, with a focus on maintaining spreads,” said Abdul Rahim. “FBL’s financial performance has earned the Bank “AA” and “A1+” ratings for the long and short terms respectively, with stable outlook from JCR-VIS Credit Rating Company Limited and Pakistan Credit Rating Agency Limited,” he said.
In May 2017, the Chairman of the FBL Board of Directors announced the appointment of Yousaf Hussain as acting Chief Executive of the Bank replacing the former Chief Executive who resigned in mid-May 2017. Abdul Rahim said, “Earlier during the year, the board has also inducted three independent directors, namely Fuad Azim Hashmi, Mian Mohammad Younis, and Ali Munir.” He also said the newly constituted board now comprises one-third independent directors with a rich blend of diverse local and international management and financial expertise. “We are confident that Faysal Bank will embark on the next phase of its ambitious journey under the guidance of the esteemed Board of Directors,” he added.
Abdul Rahim said that Hussain is an experienced professional banker with over 22 years of multifaceted local and international experience with leading institutions including ABN AMRO in the last eight years at FBL.
