MANAMA: The shareholders of the Bahrain Commercial Facilities Company (BCFC) have approved the payment of BD7.25million cash dividends, 45% of paid-up capital, for the year 2014 during the Company’s annual general assembly (AGM) held at the Diplomat Radisson Blu on Tuesday.
The AGM and EGM were presided over by the Chairman of the board of directors Abdulrahman Yusuf Fakhro and attended by the directors, executive management and over 80% of the total shareholding of the Company.
The year 2014 was the most successful year for Bahrain Commercial Facilities Company BSC in its history. The Group has delivered its highest ever net profit of BD 14.5 million (2013: BD 13.1 million) which translates into a return on equity of 14%.
2014 was also the second year of the Company’s current 3-year strategic plan for the period 2013 to 2015. Over the last two years, the Group has implemented a wide range of initiatives ahead of schedule. Several of these are qualitative in nature and they have contributed significantly to the outstanding performance. One important project the Group has recently commenced is the construction of its new corporate headquarters building which is designed to meet all present and future needs. The Group with a solid capital base and a low leverage of 1.59 times is well placed to take advantage of any new opportunities as and when presented.
Bahrain Credit has reported a record net profit of BD9.8 million (2013: BD 9 million). In the backdrop of the positive economic environment in Bahrain, the company has provided new loans of BD 115 million – the first time in its history that it has crossed three digits in new lending in a single year. As of 31 December 2014, the total loan portfolio, net of impairment provisions stands at BD 198.5 million, 14% higher than last year.
Despite price based competition, the company strengthened its dominant position in the consumer finance market by successfully implementing its strategic initiatives. Additional investments in improving operating procedures, and efficient servicing of customers’ requirements through conveniently positioned branches has resulted in increased market share. The company has reinforced its leadership position in its core product – vehicle loans, thanks to its strong relationship with key auto dealers and sub-dealers.
The quality of the portfolio remains a key priority – it is dependent on uncompromising underwriting standards and an efficient collection and recovery function. The non-performing loans stood at a very satisfactory 3.1% of the total loans portfolio; it is worth mentioning that most of the company’s new lending is made on a partially or fully secured basis and all past due loan accounts are well covered by impairment provisions.
The company has made further inroads in the unsecured lending and credit cards market. With seventeen thousand active customers, Imtiaz is now an established player and a force to reckon with in the credit card market.
Building on this strong market penetration, Bahrain Credit introduced the Platinum Card to selected clients. The strong relationship with Mastercard that has been forged since 2010 resulted in it conferring Bahrain Credit with a Principal Membership in 2014. This will provide the company more flexibility in structuring new product offerings and benefits to customers.
The confidence level in the real estate market over the past twelve months has significantly improved. The Company continued its cautious lending approach for mortgage loans, mostly funding those customers who can service their loan installments with regular cash flows independent of the underlying assets financed and limiting the lending to 70% of the property value.
The company with a low leverage remains comfortable in its liquidity position. In continuation of the efforts of the management to diversify its funding base and spread the maturities of its obligations, the company has successfully issued a new $53 million floating rate bonds that will mature in 2019.