Bank ABC, a leading player in the region's banking industry, reported that the consolidated net profit attributable to shareholders of the parent company for the first quarter of 2019 was $55 million, 4 per cent higher compared to $53 million reported for the same period last year.
Profit before taxation was $76 million, 5 per cent lower compared to $80 million reported for the first quarter of 2018 and was impacted by FX depreciation, mainly a 14 per cent devaluation year on year of Brazilian Real (BRL) against USD, said a statement from the bank.
On a headline basis, total operating income was $215 million against $211 million reported for the same period last year.
Underlying growth of 8 per cent in local currency terms was reduced to 2 per cent by FX depreciation of the Brazilian Real (BRL) against USD in particular.
The earnings per share remained steady at $0.02, similar to the first quarter of the previous year.
Operating expenses were at $128 million, $9 million or 8 per cent higher than the same period of last year, due to inflation and continuing investment into strategic initiatives to transform and reshape the bank.
Impairment charges were at $11 million compared with the $12 million reported for the same period last year and are largely in line with our expectations for cost of credit, also reflecting proactive and conservative credit management.
Ratio of impaired loans to gross loans remained at 2018 year-end levels of 4.0 per cent, but normalises to 3.1 per cent, when long-standing legacy fully provided loans are adjusted for. Provisions coverage against the aggregate impaired exposures remained comfortable at 97 per cent.
Tax charge is $10 million, compared to the charge of $14 million for the previous year’s first quarter, driven by lower pre-tax profit and FX impact.
Total comprehensive income attributable to the shareholders of the parent was $89 million compared to $50 million reported for the first quarter of 2018, primarily due to fair value movement in FVOCI debt instruments.
Total assets stood at $29.9 billion at the end of the first quarter of 2019, compared to $29.5 billion at the 2018 year-end, whilst loans and advances remained constant at $14.9 billion, reflecting our continuing emphasis on prudent use of balance sheet.
Deposits at the end of the period were at $21.2 billion, $0.5billion higher than the $20.7 billion at 2018 year-end, with main growth being in customer deposits $17.2 billion up from $16.4 billion.
Liquidity ratios were strong, with LCR and NSFR on a Basel III basis exceeding 100 per cent with comfortable buffer and liquid assets to deposits ratio healthy at 58 per cent.
Capital Ratios strong: Tier 1 16.6 per cent and total capital adequacy ratio (CAR) 17.3 per cent.
Bank ABC's group chairman Saddek Omar El Kaber said: “The Q1 results show a positive start to the year. We remain cautious, particularly given the mixed outlook we face in our markets as well as signs of changing Global market trends.”
“As has been our position, we continue to place emphasis on bank’s organisational health through maintaining a strong balance sheet and conservative credit risk management. We take comfort that this course was also recognised by S&P in upgrading ABC’s rating outlook to BBB- stable in its recent review,” he added.
Bank ABC is a leading player in the region’s banking industry and provides innovative wholesale financial products and services that include corporate banking, trade finance, project and structured finance, syndications, treasury products and Islamic banking. It also provides retail banking services through its network of retail banks in Jordan, Egypt, Tunisia and Algeria. – TradeArabia News Service
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